On October 2, 2026, Lovehoney Group UK Limited (Companies House no. 04637868), the Bristol-based retail and own-brand operating company inside the Lovehoney Group, filed full accounts for the year ended December 31, 2025. Home of Direct Commerce wrote them up on October 7. Turnover slipped 1.6% to £93.2M (2024: £94.7M), and the company swung to a £16.4M pre-tax loss from a £14.3M profit the year before. Underneath, the business was close to flat. Gross margin improved from 38.6% to 40.6% (gross profit £37.8M) and EBITDA eased only slightly, to £19.1M from £19.5M.

Why It Matters

This is one of the few audited windows into the group formed by the 2021 Lovehoney–WOW Tech merger. The group owns Womanizer, We-Vibe and Arcwave, which keep appearing in our device coverage. The picture is a mature UK retail franchise with improving margins and steady EBITDA, a European bolt-on strategy that hasn't worked, and a parent extracting cash at a high rate. For investors, a £26.5M impairment on Covid-era acquisitions is a direct admission that pandemic-peak multiples for sexual-wellness retail assets didn't last, and it is a useful marker for anyone pricing current M&A such as Nalpac–Holiday Products or the torso-doll rollups. For competitors, the numbers suggest UK sexual-wellness e-commerce is now a margin and cost-control business rather than a growth one. Turnover is flat, and gross margin gains are carrying the profit line. Two things to watch: whether the group restructures or exits its French and Swiss operations after the write-down, and whether the large intra-group cash transfers point to refinancing or ownership changes further up the structure.

The loss comes from a write-down, not from trading. The strategic report shows £28.7M of "unusual and non-recurring items" (2024: £16k). Of that, £26.5M is an investment impairment on the businesses acquired around the Covid period in France (Lovehoney Group France SAS) and Switzerland (Lovehoney Group Switzerland AG), which the directors say "reflect our current view of the book value of these businesses." Home of Direct Commerce gives the impairment as £28.2M. We've used the filed accounts' £26.5M impairment within £28.7M of one-off items. Corporation tax of £2.4M, inflated by the non-deductible impairment, brought the loss after tax to £18.8M (2024: £11.4M profit).

The geographic split shows where the problem is. According to the revenue note, the UK brought in £76.0M, Rest of the World £14.0M and Rest of Europe only £3.15M. Home of Direct Commerce reports UK revenue up 0.9%, Rest of the World up 11.6%, and Rest of Europe down from £6.8M to £3.2M. In other words, the UK entity's European sales roughly halved in a year, and the year-end valuation of the French and Swiss businesses moved the same way. Non-exceptional admin costs rose £3.3M to £25.2M. The company attributes £1.0M of that to FX on a euro-denominated loan, £1.1M to staff costs and bonuses, £0.6M to technology and website spend, and £0.6M to amortisation.

The cash moves stand out. Year-end cash rose to £23.2M from £12.9M, with operating cash flow "being loaned to other group companies." During the year the company also paid a £58.9M dividend to its parent, Lovehoney Group Limited. That is roughly three years of current EBITDA. The directors recommend no further dividend. The filing names the main risks as variability in consumer demand and dependence on its own e-commerce and website infrastructure, including cybersecurity.

Sources

Update — 2026-10-08

Initial entry — story first created.