ASOS on track to meet year targets as first-half profit rises

LONDON / Reuters

British online fashion retailer ASOS met forecasts with an 18 percent rise in first-half profit and said it was on track to achieve its sales and margin guidance for the full year.
Established in 2000 for fashion-conscious twenty somethings, ASOS was an early ecommerce success story, but is seeing growing competition from the likes of Germany’s Zalando and British rival Boohoo, as well as from traditional store-based chains improving their online offerings.
ASOS said on Tuesday it made a pretax profit of £21.2 million ($30.2 million) in the six months to Feb. 29, in line with analysts’ average forecast and up from 18 million pounds in the same period last year.
Retail sales rose 24 percent on a constant currency basis to £648.6 million, as the firm grew its active customer base 17 percent to 10.9 million. UK sales rose 25 percent, while international sales were up 24 percent.
ASOS said investment in technology and logistics was bearing fruit, delivering 21 percent growth in visits to its sites and growth in average order frequency, basket value and conversion. “I’m pleased to confirm that we are on track to achieve our previously stated sales and margin guidance for the full year,” said Chief Executive Nick Beighton, who took over last September from founder Nick Robertson.
Primarily aimed at young adults, ASOS sells over 850 brands as well as its own range of clothing and accessories. Revenue for the financial year ending August 31, 2015 was £1,119.9 million. As of August 2015, ASOS PLC has net assets of £237.3 million. ASOS.com is a global online fashion and beauty retailer, offering women-wear, men-wear, footwear, accessories, jewellery and beauty products. ASOS has websites targeting the UK, Australia, US, France, Germany, Spain, Russia, Italy and China. It also ships to over 140 countries from fulfillment centres in the UK, US, Europe and China.
In October ASOS forecast sales growth for the 2015-16 year of about 20 percent and a maintained operating margin of 4 percent.
Beighton wants ASOS to concentrate its efforts and investment on its main markets of Britain, France, Germany and the United States.
Last week the firm said it will discontinue local operations in China, with the ASOS.com website now servicing customers in the territory rather than a local website. Shares in ASOS which listed at 20 pence in 2001, have fallen 18 percent over the last year and closed at 34.03 pounds on Monday, valuing the business at 2.82 billion pounds.
ASOS’s headquarters are in Camden Town, at Greater London House. As of 2013, their main fulfillment centre is in Barnsley, South Yorkshire, where they employ 3,000 workers. The Customer Care department is based in Hertfordshire. In 2016 the company launched its first drama-game show series called #DIGIDATING, starring AJ Odudu. It was billed as an Internet dating show with backstage drama.