ASOS profits to be at lower end of guidance
ASOS has warned that its earnings before interest and tax are likely to come in at the bottom end of expectations in its full year.
In a fourth quarter trading statement covering the three months to 3 September, the online fashion retailer said adjusted like-for-like sales were down 15% following a stronger start to the period and a weaker performance later in the summer.
While sales in the UK declined by 16%, sales in Europe, the US and the rest of the world fell by 7%, 19% and 28% respectively.
The retailer said sales in the UK were hit by wet weather in July and August.
ASOS is currently following a new commercial model that has been designed to improve profitability while reducing its investment in discounting.
Commenting on the quarter’s results, José Antonio Ramos Calamonte, chief executive of ASOS, said: “ASOS has delivered on the Driving Change agenda and as a consequence is a leaner and more resilient business twelve months after its launch.
“We have reduced our stock balance by c.30%, significantly improved the core profitability of the business and generated cash against a very challenging market backdrop.”
Looking ahead, ASOS said its full-year EBIT is now expected to be at the bottom end of its guided £40 million to £60 million range.
Calamonte added: “We continue to focus on bringing the best fashion and the most engaging proposition to our customers as we make progress on our journey to sustainably profitable and cash generative growth.”
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