Asos warns of weak sales as inflation hits clothes shopping

Bloomberg

British fast-fashion company Asos Plc warned that sales in August were weaker than expected as inflation crimped shoppers’ purchasing power.
Full-year profit will come in at the lower end of guidance, with sales growth of only about 2%, according to a statement. The online retailer also cited a
slow start to its autumn/winter ranges.
“Asos remains cautious about the outlook for consumer spending,” the company said.
The earnings season looks likely to continue to be tough
for retailers. Associated British Foods Plc, owner of budget chain Primark, warned that profit will decline next year under pressure from rising energy costs and the strengthening of the dollar.
Asos is having a difficult year and issued a profit warning in June as the cost-of-living crisis sapped consumers’ spending power.
The company had already warned in April that its earnings goal was at risk from inflation and disruption from the war in Ukraine. The lower end of its guidance is $23 million.

Management Changes
The company’s top management team is also changing again with Mat Dunn, who oversaw the business after Nick Beighton left last year, leaving and handing over to chief commercial officer Jose Antonio Ramos Calamonte as CEO.
Shoppers are navigating the highest inflation in four decades in the UK and there are signs
that they’re cutting back on
purchases of clothing and other non-essential items.