Asos has warned that its profits will fall at the lower end of its expectations amid its ongoing turnaround programme as sales drop for the fourth consecutive quarter. The online fashion retailer said its expects earnings before interest and tax to be ‘around the bottom of the guided £40m to £60m range’ for the six months to September 3, 2023.
Sales dropped 15% in the three months to September 3, due to a “weaker than expected” July and August as a result of the wet weather. Despite the fall, Asos said it posted “another profitable quarter” thanks to £300m of ”material improvements to core profitability and strong inventory management” under its Driving Change turnaround programme.
Chief executive José Antonio Ramos Calamonte commented:
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 about 30%, significantly improved the core profitability of the business and generated cash against a very challenging market backdrop.
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.”
