Online fashion retailer Asos meets forecasts

ONLINE fashion retailer ASOS met forecasts with a one per cent rise in profit for 2014-15, helped by demand for cut-price fashions abroad and strong trading in its home market.

The ASOS distribution centre near BarnsleyPhoto: Rui Vieira/PA Wire
The ASOS distribution centre near BarnsleyPhoto: Rui Vieira/PA Wire

The firm, whose founder, Nick Robertson, quit as chief executive last month, also said that trading in its new financial year had started well.

ASOS, whose fast fashion is popular with Internet savvy twentysomethings, forecast sales growth for the 2015-16 year of about 20 per cent.

“We remain focused on achieving our next staging post of £2.5bn s (of) sales,” said Nick Beighton, who stepped up to CEO from chief operating officer on Robertson’s exit.

ASOS made a pretax profit of £47.5m in the year to August 31. That compared to analysts’ average forecast of £47.2m and the £46.9m it made in the 2013-14 year.

Its total retail sales rose 17 per cent to £1.12bn, with UK sales up 27 per cent, international sales up 11 per cent and gross margin rising 20 basis points.

The firm had a tough 2014 when it issued three profit warnings but its trading recovered in 2015, helped by price cuts and a zonal pricing system that allows the firm to charge prices country by country to reflect fluctuating exchange rates.

In a statement to accompany the results, Asos said: “Our Barnsley warehouse efficiency improved as the year progressed following the successful launch of our mechanised picking solution at the start of the year.

“We also exited our off-site storage facility at Lister Hills in February following completion of our two high bay mini-loads.

“These now store all our bulk stock at Barnsley and, with our new warehouse control system, automatically retrieve and maintain stock levels in the main pick-face area of the warehouse, increasing our stock management capabilities. We also increased capacity at our returns processing centre in Selby during the year.”