ASOS issues profit warning after promotions and slowing international growth hit margins
ASOS has issued an unexpected profit warning after a slowdown in its international sales growth and increased promotional activity led it to reduce its margins.
The online retailer, which was due to release its Q3 Trading Statement next Tuesday, said that the strength of the British Pound led to international sales growth slowing to 17 per cent in the three months to the end of May.
Despite the warning, retail sales were up 25 per cent year-on-year.
Nick Robertson, CEO, ASOS commented: “Whilst our profit performance for this financial year is not what we had hoped for due to an unusual combination of factors, our accelerated investment in technology and infrastructure to support our £2.5bn sales ambition is progressing and capex remains within guided levels.
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“All customer metrics - active customers, new customers, order frequency and units per basket - are positive and we are totally focussed on rolling out the ASOS business model globally as the world's leading online fashion destination for 20-somethings.”
The retailor forecast its operating margin for the year would fall from 6.5 per cent to around 4.5 per cent.