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Boohoo sales dip on higher returns, tough comparative

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FILE PHOTO: A smartphone with the Boohoo logo displayed is seen on a keyboard in this illustration
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LONDON (Reuters) -British online fashion retailer Boohoo reported an expected fall in revenue in its latest quarter, reflecting higher product returns and a tough comparison with the same period last year when sales got a pandemic boost.

But the group, which sells clothing, shoes, accessories and beauty products aimed at 16 to 40-year olds, maintained its guidance for the full year.

Boohoo said on Thursday its revenue fell 8% to 445.7 million pounds ($540.8 million) over the three months to May 31.

It said UK sales fell 1%, but returned to growth in May.

The group said its international performance continued to be impacted by increased delivery times, with sales down 28% in the United States, down 9% in the rest of Europe division and down 15% in the rest of world division.

Gross margin for the quarter was 52.8%, down 220 basis points.

Boohoo warned last month that sales would fall in its first quarter. It forecast a return to growth in the second quarter and an improved performance in the second half.

Revenue growth for the full 2022-23 year is expected be "low-single digits", with adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) margins of between 4% and 7%.

Prior to Thursday's update, analysts' average forecast for 2022-23 adjusted EBITDA was 102 million pounds, down from the 125 million pounds made in 2021-22.

Shares in Boohoo have fallen 80% over the last year.

($1 = 0.8242 pounds)

(Reporting by James DaveyEditing by Jason Neely and Mark Potter)

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