Lovisa Accelerates Global Growth with 14% Sales Rise and Strong Margin Gains
Lovisa Holdings delivered a robust FY25 with 14.2% sales growth, margin expansion, and over 160 new stores globally, setting a confident tone for FY26.
- Total sales up 14.2% driven by 162 new stores
- Gross margin improved by 100 basis points to 82.0%
- EBIT increased 8.2% to $138.7 million, NPAT up 4.8%
- Global store network expanded to 1,031 locations across 50+ markets
- Positive start to FY26 with 5.6% comparable sales growth
Strong Sales and Store Expansion
Lovisa Holdings Limited has reported a solid FY25 performance, with total sales climbing 14.2% to nearly $800 million. This growth was largely fueled by an aggressive store rollout program, adding 162 new stores worldwide, offset by 31 closures or relocations, bringing the total store count to 1,031 across more than 50 markets. The company’s global footprint continues to expand, notably with significant store openings in Europe and the Americas, while Asia remains a challenging region with subdued sales and slower rollout.
Margin Expansion and Earnings Growth
Lovisa’s gross margin rose by 100 basis points to an impressive 82.0%, marking the second consecutive year of margin improvement. This was achieved through disciplined pricing strategies and effective management of supplier costs and promotions. Earnings before interest and tax (EBIT) grew 8.2% to $138.7 million, while net profit after tax (NPAT) increased 4.8% to $86.3 million. The company absorbed higher costs related to store network growth and investments in marketing and technology, yet maintained profitability growth.
Cash Flow Strength and Dividend Policy
Operating cash flow remained robust at $243.3 million, supporting continued investment in new stores and infrastructure. Capital expenditure reached $55 million, reflecting the ongoing store expansion. Despite increased lease liabilities and interest expenses from the growing store base, Lovisa declared a final unfranked dividend of 27 cents per share, bringing the full-year dividend to 77 cents. The company emphasized its strong balance sheet and available facilities of $120 million to underpin future growth.
Leadership and Strategic Outlook
FY25 saw a leadership transition with John Cheston stepping in as global CEO in June 2025, alongside the appointment of Mark McInnes as Executive Deputy Chairman, strengthening the board and executive team. Lovisa remains committed to its fast-fashion jewellery model, focusing on high-margin products and a small store footprint. The company is investing in digital platforms and omni-channel capabilities to enhance customer engagement and drive future growth. Early FY26 trading is encouraging, with comparable store sales up 5.6% and total sales growth of 28% in the first eight weeks, signaling momentum heading into the new financial year.
Challenges and Opportunities Ahead
While Lovisa’s global expansion and margin gains are commendable, the subdued performance in Asia highlights regional challenges that may require strategic adjustments. The company’s ability to sustain growth amid rising costs and competitive pressures will be closely watched. Nonetheless, the strong cash flow, disciplined cost management, and expanding store network position Lovisa well to capitalize on future opportunities in the fast-fashion jewellery sector.
Bottom Line?
Lovisa’s FY25 results underscore a confident growth trajectory, but sustaining momentum across diverse markets will be key to unlocking its full potential.
Questions in the middle?
- How will Lovisa address the subdued sales and slower rollout in the Asian market?
- What impact will the new CEO and executive appointments have on strategic execution?
- Can the company maintain margin expansion amid rising costs and global expansion?
