Boohoo Group PLC on Friday said its chief executive was stepping down as the firm launched a strategic review amid a downturn in sales.

The Manchester-based online fashion retailer said there is ‘potential to unlock shareholder value’ and that it is ‘exploring options to deliver on this.’

Executive Chair Mahmud Kamani said the board is ‘focused’ on ensuring it takes the right steps in the interest of all its stakeholders.

‘The business has evolved over last few years and has an offer that is much wider than our original focus on young fashion. The time is now right to consider options with regard to corporate structure, with the aim of maximising shareholder value.’

In a wide-ranging statement, boohoo said it believes that the group remains ‘fundamentally undervalued’.

The firm noted it had already executed on a series of ‘decisive and robust’ strategic initiatives to drive operational efficiencies and optimise the cost base over the last 18 months.

In addition, ‘substantial’ strategic progress has been made including the reinvigoration of the Debenhams and Karen Millen brands.

Boohoo said Chief Executive John Lyttle would be stepping down but would stay with the business whilst a successor is found and to ensure a smooth transition.

Boohoo also updated on trading in the first half of the financial year.

Revenue fell 15% to £620 million in the six months to August 31 from £729 million a year prior.

Gross merchandise value pre returns fell 7% to £1.18 billion from £1.27 billion. In the UK, GMV fell 2%, but it declined more sharply in the US, by 18%, and the Rest of the World by 21%.

Adjusted earnings before interest, tax, depreciation and amortisation declined to £21 million from £31 million.

In the second half, boohoo expects a higher GMV and a stronger adjusted Ebitda performance, when compared to the first half, despite further investment into the brands to unlock shareholder value.

In addition, boohoo said it has agreed a new £222 million debt facility with a consortium of its existing relationship banking group.

The facility compromises of a £125 million revolving credit facility that runs to October 2026 and a £97 million term loan that is repayable by August 2025.

Shares in boohoo rose 0.5% to 32.04 pence each in London on Friday morning.

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