On Wednesday, London-listed shares in Boohoo Group PLC (LON:BOOH) declined sharply after the company reported a steep decline in half-year core profit and cut its annual guidance. The British online fashion retailer cited the effect of rising inflation on sales.

Reportedly, adjusted earnings before interest, taxes, depreciation, and amortisation declined to £35.5 million in the six months to August 31, down by 58% compared to the same period last year, while its income margin plunged to 4% from 8.7%.

During the period, demand remained weaker than anticipated, as shoppers, especially in the US, reined in spending in response to surging consumer prices. Also, its revenue declined by 10% to £882.4 million.

Further, freight and logistics costs were also elevated, although this incline was partially offset by a decision to move supply chain sources away from the Far East, where COVID-19 lockdowns in China have weighed on the crucial flow of goods out of the country.

Under consensus forecasts, core income came in at 11%. Sales, on the other hand, were missed by 8%. Meanwhile, Boohoo lowered its outlook for adjusted profit margins for its current financial year to between 3% to 5%.