boohoo reports very strong P1 trading which we expect to lead to significant upgrades of c.10%-15% P1 trading, 3 months to 31st May FY21 P1 Group sales were £367.8m, +45% YoY (consensus: £291.4m, +14.6%), implying a very strong end to the quarter given subdued growth in mid-March and mid-April. Brand performance has not been broken out, but there have been strong performances across all geographies, especially in ROE and US up +66% and 79% respectively (FY20 P4: ROE: 61%, US: +53%). Gross margins were also up +60bps to 55.6% (consensus: 53.6%). Areas such as loungewear and athleisure have performed well “as customer buying habits adapted to a stay at home lifestyle”. Balance sheet, M&A, outlook and valuation Today, boohoo has also acquired the brand Oasis for £5.25m which reported full-year direct online sales of £46.8m in the year to February FY20. The Group now has excess funds of £350m following the £197.7m placing and pre-reported acquisition of the remaining stake in PLT earlier in the quarter. Outlook: As such, management now expects profits for the year to be ahead of expectations with full-year sales growth of +25% (FY20 consensus: +18%) and EBITDA margins between 9.5% and 10% (consensus: 9%). This implies that sales growth needs to be just +20% for the remainder of the year and that management expect FY21 EBITDA of c. £150m (consensus: £132m). Some conservatism has been built into management expectations given that it anticipates higher levels of markdown and carrier cost inflation. There will no doubt have been some benefit in this period given reduced levels of competition, however, this is a strong performance and the read-across for ASOS is also positive (see our recent note). Valuation, pre forecast changes, is 57x NTM PE with EPS growth of 16% p.a. for FY20-23E.