THG Shares Jump After Profit Upgrade Despite Modest Q3 Sales Growth
THG PLC shares jumped 9.3% to 30.08p following the company's upgrade of its full-year Adjusted EBITDA expectation to £103 million, exceeding market consensus of £101.7 million. The online beauty and nutrition group, which operates Myprotein and Lookfantastic, published its third-quarter trading statement on 15 October, citing stronger performance in its Nutrition division.
Founded in 2004 by Matthew Moulding and John Gallemore as an online CD and DVD retailer, THG transformed into a beauty and wellness powerhouse through strategic acquisitions. The company purchased Lookfantastic in 2010 and Myprotein in 2011 for approximately £60 million. Following its demerger of THG Ingenuity earlier in 2026, the business now operates as a focused beauty, health and wellness consumer brands group through two main divisions.
The upgraded profit guidance reflects trailing twelve-month Adjusted EBITDA of £100.6 million at 30 September, up 50% on a like-for-like basis. Chief executive Matthew Moulding, who has led the company since its founding and previously served as Chief Financial Officer of 20:20 Mobile before leading its sale to private equity for £365 million, stated:
Following a particularly strong first half of 2026, I'm pleased to report that our momentum has continued through Q3, with profitability exceeding our expectations.
Revenue performance proved more modest. Group sales for the quarter to 30 September reached £408.8 million, up 1.5% at constant currency on continuing operations. The Beauty division, which operates platforms including Lookfantastic, Cult Beauty and Dermstore serving over 1,000 third-party brands, saw sales decline 0.6%. The Nutrition division, led by Myprotein—the UK and Europe's number one sports nutrition brand—grew 5.3%.
THG noted that approximately £3 million of beauty advent calendar sales made in September were not dispatched until October due to kitting problems at a new third-party supplier. Excluding this timing issue, the company said Group growth was 2.1%.
Nutrition Division Drives Performance
The Nutrition business delivered particularly strong unit volume growth, with Myprotein branded unit volumes rising 36.2%. A significant tailwind came from falling input costs: the price of WPC80, a key whey protein ingredient, has fallen about 20% since the 10 September interim results. Earlier in 2026, WPC80 prices had experienced significant volatility, reaching approximately €26,450 per metric tonne in European markets during April-May before declining from their peaks.
THG secured fourth-quarter ingredient needs at better pricing than the third quarter and is securing first-quarter 2027 cover below prevailing market rates, which should support margin improvement in the Nutrition business.
Financial Outlook and VAT Claims
The company guided to free cash flow of £25 million to £35 million for 2026, in line with consensus and representing its first positive year since its September 2020 initial public offering on the London Stock Exchange. That flotation, the largest IPO on the LSE since 2013, saw share prices rise 25% on the first day of trading and generated £920 million for the company.
THG expects an update on outstanding VAT claims from HMRC by the end of October. The company has submitted retrospective VAT claims for powdered protein and collagen products, following a First Tier Tribunal decision that found Sunwarrior protein powders qualify for 0% UK VAT. A successful claim could result in a cash repayment of approximately £78 million.
Management expressed confidence that the fourth quarter, its busiest trading period, should bring faster revenue growth. The company reported revenue of £1,717.9 million for the full year 2025, with 2,912 employees as of year-end 2025, down from 7,127 the year before.
Shares opened at 30.1p on 15 October and traded in a range from 29.3p to about 31.45p during the session. Before the announcement, the highest close since mid-July was 35.06p on 26 August, with the lowest at 25.96p on 17 September.
