Lovisa Holdings has reported full year net profit growth of 10.7% to $95.6 million, with the company rewarding shareholders through a dividend increase of 11.7% to 86 cents per share on a 100% earnings distribution policy. The result reflects robust operational performance across the retailer’s global store network, which expanded by 160 locations during the financial year to reach 1,136 stores across more than 50 markets.
Revenue grew 17.6% to $938.8 million, driven by continued expansion in the Americas, up 29.6%, and Europe, up 29.5%. While comparable store sales growth of 2.0% was more modest, this performance occurred against a strong prior year comparison and came alongside a remarkable 60 basis point improvement in gross margin to 82.6%. This margin expansion, representing a 270 basis point improvement since FY23, demonstrates Lovisa’s ability to enhance profitability through sourcing discipline and promotional efficiency even as it scales its store footprint globally.
The financial quality of the result is underscored by cash generation strength. Operating cash flow increased 21% to $294.5 million, providing the company with sufficient capacity to fund its capital programs entirely from operational cash while maintaining its enhanced dividend. EBIT grew 14.1% to $158.2 million, though this includes investment in Jewells, a seven store trial brand in the UK that is in its start-up phase and weighing on reported earnings.
Store expansion in FY26 reflected strategic capital allocation, with Europe providing the largest increment at 76 new stores, including 34 in the UK and 20 in Germany. The Americas contributed 44 new locations, while the company also closed 43 underperforming stores and executed 12 relocations. This disciplined approach to store portfolio management, combined with the scale of expansion, positions Lovisa to sustain its growth trajectory as market penetration deepens across developed markets.
Momentum appears robust entering FY27. The company reported total sales growth of 16.4% on a constant currency basis for the first eight weeks, with comparable store sales accelerating to 3.0% and August showing further improvement. Investors should monitor the progression of comp store sales and the profitability trajectory of the Jewells brand trial, which could signal capacity for margin expansion if it reaches sustained performance. The strength of gross margins and cash flow generation will remain critical indicators of operational leverage as the company continues its global expansion.
This announcement is price sensitive and has been flagged as material by the ASX.
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About Lovisa Holdings Limited (ASX: LOV)
Lovisa is an Australian fashion jewelry and accessories retailer that operates stores across Australia, New Zealand, and international markets. The company specializes in trend-driven jewelry, fashion accessories, and related products sold primarily through its own retail stores. Lovisa is known for its fashion-forward, affordable jewelry offerings targeting young women.
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