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Sales at Asos climbed by almost a fifth in the last quarter but the online fast-fashion retailer has warned that there is still significant short-term uncertainty ahead due to the Covid-19 pandemic.
The company reported revenues of almost £1.3bn for the four months to 30 June, up from £1.1bn in the same period last year. However, sales softened in the last weeks of June amid uncertainty over Covid-19 and unseasonal weather.
The fashion company, popular with twentysomethings, said it expected trading volatility to continue in the near term as the impact of Covid-19 on its supply chains and freight costs continues to dampen profits. Shares fell 14% on Thursday morning after the trading update was published.
The company, which more than tripled first-half profits in the six months to the end of February to a record £106m, has enjoyed the benefit of a shift from bricks and mortar shopping to online retail shopping during the coronavirus pandemic.
Nick Beighton, the chief executive, said the company would need to be “mindful of the continued impacts of the pandemic on our customers in the short term”, but added that the pandemic would still benefit online retailers over the long term.
“We believe that the structure of the global e-commerce fashion market has changed forever, which will drive an increase in online fashion sales over the long term,” he said. “We’re excited about the size of the prize ahead of us and the opportunity of delivering on our ambition of being the No 1 destination for fashion-loving twentysomethings.”
The UK remained the retailer’s biggest market, generating underlying sales of more than £526m over the last quarter, up 36% on the same period last year. In the EU, sales topped £388m, up 15% from last year.
Asos said sales were “particularly pleasing” in Germany, despite Covid-19 restrictions remaining in place for much of the period, but in southern Europe the market was more challenging due to a slowdown in the region’s tourism industry which had affected the prospects of twentysomethings. US sales grew a fifth to £144.8m.
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