Hut Group shares crash as two directors quit 

Shares in The Hut Group crashed to record lows as the alarm sounded over the sale and saw the shock drain from two top directors.

The controversial online retailer said Zillah Byng-Thorne and Andreas Hansson had resigned “with immediate effect”.

And THG said sales and profits this year would be lower than expected as costs go up and consumers cut back on spending.

Shares fell 18.4 percent, or 9p, to 40p.

It is the latest in a series of blows for the company that has now lost more than 90 percent of its value since it entered the stock market two years ago.

At the time, The Hut Group – now known as THG – was seen as the stock market darling, with its shares going for 500 pence each. They briefly hit 800 pence, making the company worth nearly £10 billion.

But it has been hit by a slew of corporate governance concerns and questions about its high valuation, leaving it valued at around £500 million.

That has resulted in THG founder and CEO Matt Molding losing a whopping £1.26 billion on his own 22 percent stake, which is now worth around £115 million.

Byng-Thorne was one of two directors to leave the boardroom yesterday alongside Hansson, who joined last October.

Her departure after nine years is a blow to the already struggling company, as the 47-year-old is one of the UK’s most successful CEOs.

Byng-Thorne is credited with turning publishing giant Future over and helping its stock rise about 1,000 percent over the past eight years.

After her departure, Dean Moore will join the board, the former financial director of Cineworld, who filed for bankruptcy in the US this month. Former Microsoft senior manager Gillian Kent will also join.

The commotion in the boardroom coincided with the THG results for the first half of the year, in which sales hit a record £1.1bn.

But the company behind brands like Lookfantastic and Myprotein has been plagued by rising costs of whey and other materials. It lost £89.2 million in the first half of the year, five times more than in the same period a year ago.

THG said revenue growth would stall in the second half of the year as rising cost of living prompts customers to rein in spending. It said revenue growth will now be as high as 15 percent, down from a previous forecast of up to 24 percent.

Meanwhile, the profit forecast for the year was also reduced from in line with last year’s £161 million to between £100 million and £130 million.

Despite the most recent crash, Molding said he is still confident the company can deliver “long-term value” for shareholders.

The dismal update comes just months after Molding rejected a series of takeover bids that would have valued THG as much as £2bn.

Russ Mold, investment director of AJ Bell, said: “THG stated it had made “significant progress”, but investors who have suffered a 92 percent share price loss since the company entered the stock market may think otherwise.”