- ASOS revealed its adjusted half-year pre-tax losses amounted to £120m
- The London-based company reduced its inventory levels to £593 million.
ASOS has reported wider losses as cost-of-living pressures and stock-cutting measures continued to weigh on sales.
The online fashion retailer revealed that adjusted pre-tax losses rose to £120m in the six months ending March 3, from £87.4m during the same period last year.
Its margins were significantly affected by heavy discounting aimed at clearing old stock built up during the peak of Covid-related restrictions.
Struggling retailer: ASOS revealed that adjusted pre-tax losses rose to £120m in the six months ending March 3, from £87.4m during the same period last year.
ASOS has reduced its inventory levels to £593m, having set a target of holding around £600m in stock by the end of this financial year.
But the move also contributed to its half-year turnover falling 18 per cent to £1.51bn, with sales further hit by poor trading in major territories and disruptions to shipping in the Red Sea.
In the UK, the group’s revenue fell 16 percent as the tough economic climate discouraged its younger customer base from buying clothes.
Meanwhile, its revenue fell by a quarter in the United States, which the group attributed to stiff competition and a “narrower focus” on advertising.
ASOS faces growing rivalry with Chinese fast fashion brands Temu and Shein, whose sales have soared in recent years.
And like other online retailers, ASOS has struggled to boost sales since the end of lockdown restrictions prompted shoppers to return to buying more clothes in stores.
As a result, ASOS Shares They have fallen around 94 per cent since reaching a high in April 2021 of around £59.95. They rose 5 per cent to £3.50 on Wednesday morning despite the company reporting a wider loss.
Julie Palmer, partner at Begbies Traynor, said if ASOS “can successfully adjust its inventory, which it has already made progress on, and align itself more closely with the changing tastes and purchasing power of its customers, it will be able to find its footing when the El backdrop improves.’
ASOS further announced on Wednesday that it has appointed a new chief financial officer, Dave Murray, who will replace current interim chief financial officer Sean Glithero from 29 April.
Murray was most recently CFO of e-commerce platform Matches Fashion, which went into administration in March, just three months after being acquired by Frasers Group.
Mike Ashley’s retail empire said it was unwilling to fund a turnaround of Matches because it was still making losses and failing to meet business plan targets.
Prior to Matches, Murray was vice president at beauty retailer Farfetch and also held senior finance roles at Amazon and Sainsbury’s.
José Antonio Ramos Calamonte, chief executive of ASOS, said Murray’s “extensive experience in the retail sector… will make him a valuable partner in the next phase of ASOS’s journey to become a faster, more agile and more profitable”. ‘