Adore Beauty Group Limited

FY26 revenue was $207.3 million, up 4.3% year over year. Gross margin was 34.8%, down 52 basis points from the prior year, and underlying EBITDA was $3.8 million, down 39.3% year over year, at a 1.8% margin. In-store revenue was $18.6 million, new customers increased 14.4% to 418,600, active customers rose 2.6% to 858,800, and customer acquisition costs declined to $35.20 per customer in one discussion and $37.30 in the online business discussion. For FY27, management targets revenue growth of at least 10% and EBITDA of $9 million to $13 million, with 4 new Adore Beauty stores and 1 new iKOU store expected to open in the first half, bringing the group to 25 stores.

Sacha Laing framed FY26 as the company’s biggest investment and transformation year, saying Adore Beauty completed major store, distribution and ERP investments on time and on budget. He emphasized that the business is pivoting to omnichannel retail, with stores, loyalty and owned brands creating a higher-value customer base even though earnings lagged during the buildout. His tone was confident that the foundation is now in place for a material lift in revenue and profitability over the next 18 to 24 months.

Kylie Archer highlighted a major improvement in marketing efficiency, with marketing and advertising costs down 22.8% year over year to 8.8% of sales, or 316 basis points lower than the prior year. She said the group ended FY26 with $0.7 million of cash and $9.3 million of net debt, alongside $14.4 million of undrawn facilities after refinancing with CBA on a new 3-year agreement. She also noted inventory of $23.2 million and said the business is nearing the end of its major investment cycle, with efficiencies from the new NDC, ERP, AI and head office restructure expected to flow through in FY27.

Analysts focused on the mix between store and online growth, customer acquisition efficiency, store-level performance, and whether the low EBITDA margin still leaves room for operating leverage. Management said Adore stores contributed around $15 million of the $18.6 million in store revenue, that ROAS of 14x was online-only, and that they do not split LFL online versus retail because they view the business as integrated omnichannel. They also addressed concern about liquidity and going concern, saying there was no going concern issue and that net debt should peak in H1 FY27 before easing later in the year.