To the best of my knowledge no, they no longer use them like that. I would be very surprised (and more than a little disappointed) if they chose to exercise the T&Cs in that way without making it much clearer that that’s a potential use/destination of user’s photos at the moment of upload.
I think that quote from the Image Notice is to also make people aware that your images can be downloaded and shared, which I think is more likely than Lovehoney repurposing your photo posts for advertising, etc.