Asos warns on profit after warehouse problems
Asos has warned on profit after sales in the EU and US were held back by its warehouse transformation programmes.
The online fashion company’s total retail sales climbed by 11% to £894 million in the four months to 30 June. Retail sales in the UK increased by 16%.
Sales in the EU rose by 5% but growth was hampered by weaker stock availability due to the retailer embedding new automation software in its Euro Hub.
Meanwhile, US sales growth of 12% was held back by the slower than planned build up of branded stock in the retailer’s Atlanta warehouse.
Sales in the rest of the world were up 14% in the period.
Nick Beighton, Asos chief executive, said: “Whilst we are making good progress in improving customer engagement, our recent performance in the EU and US was held back by operational issues associated with our transformational warehouse programmes. Where we have been unencumbered by these issues we have seen robust growth and overall our customer momentum is improving with the business hitting 20 million active customers globally for the first time.”
Asos now expects pre-tax profit for its full year to be in the range of £30 million to £35 million. This compares to £102 million in the previous year.
Beighton added: “We are clear on the root causes of the operational challenges we have had , are mak ing progress on resolving them, and now expect to complete these projects by the end of September . Despite the se short term challenges, the move to a multi-site logistics infrastructure will enable us to offer customers across the world our market leading proposition, facilitate our future growth, as well as leading to longer term efficiency benefits.”
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