ASOS: double digit turnover growth, big profit fall

For the year ending August 31, 2019, online fashion giant ASOS reported a 68% fall in pre-tax profits despite a 13% growth in turnover.

Chief executive Nick Beighton said: “This financial year was a pivotal period for ASOS, where we have invested significantly and enhanced our global platform capability to drive our future growth. Regrettably this was more disruptive than we originally anticipated.”

The heavy investment includes a net debt of £90.5 million as it attempts to drive sales globally.

Beighton said: ”Having identified the root causes of our operational issues, we have made substantial progress over the last few months in resolving them.” This includes rectifying automation and mechanism issues in its Euro Hub in Germany.

Transformation operations at warehouses in Berlin and Atlanta are two areas that impacted profitability, as warned by ASOS in a trading statement in July.

Beighton said: ”Our focus now shifts to ensuring that we enhance our capability to drive an improved customer experience and leverage the benefits from the investments we have made.

“With over 60 per cent of our revenue coming from international customers and a strong global logistics platform with capacity to grow, we are well positioned to take advantage of the global growth opportunity ahead of us.”

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