Wet weather hurts Asos’ profit forecast as devastating summer hits sales and profits
- Asos said its profits will be at the lower end of the £40m to £60m target.
Asos warned that the summer failure has hit sales and profits.
The online fashion firm said wet weather in July and August dragged down sales by up to 15 percent in the final quarter of its financial year.
As a result, it said it now expects profits for the 12 months to September 3 to have been at the lower end of the £40m to £60m target.
Asos also revealed it lost around 2.3 million customers last year (down 9% to 23.3 million) but insisted this was a result of its renewed focus on increasing profits rather than sales. .
The company suggested that many of the shoppers who left represented “our least profitable orders and customers,” noting that profits per order are up 35 percent and the number of costly returns has decreased.
Asos has warned that the summer failure has hit sales and profits (file image)
Asos is immersed in a turnaround plan under chief executive José Antonio Ramos Calamonte, who took over last year and soon admitted that the business model was “inefficient” and that the brand could “achieve much more.”
While Asos has struggled since the end of Covid lockdowns, sending its shares tumbling, its High Street rivals including Marks & Spencer and Next have bounced back strongly.
Calamonte said Asos was a “more agile and resilient business” a year after launching its revival plan.
Joshua Warner, an analyst at City Index, said Asos “has followed the right path”.