ASOS sales up 10% as it pays back furlough cash to the Government

ASOS achieved a 10% increase in group sales to £1.014bn in the four months to 30 June as the online fashion giant said it continued to focus on “trading dynamically and managing business performance rigorously” during the COVID-19 pandemic.

In the UK sales were down slightly, by -1%, to £329.2m but the EU was up 22% to £328m, the US up 3% at £124.9m and the rest of world up 19% to £201.2m.

ASOS also reported a strong increase in the acquisition of new international customers as its overall customer base grew by 16% year on year to 23m.

The company said it had shown good “agility” in product mix as consumer demand shifted from occasionwear to leisurewear during lockdown, with growth in “lockdown” categories held back due to health and safety measures implemented across its product supply chain.

It reported a strong recovery in the EU and rest of world markets as lockdowns eased but said the UK and US reflected “more pronounced impact from product mix shift and consumer dynamics related to ‘lockdown’ measures.”

In light of the strong performance ASOS said that it would be returning previously claimed furlough cash to the UK Government.

CEO Nick Beighton said: “This has been a tough time for all businesses, but we have remained focused on doing the right thing for our people and our customers and making sure that we emerge from the current crisis as a stronger and better organisation. I am particularly proud of the resilience, flexibility and creativity the ASOS team and our business partners have shown.

“Our performance in P3 shows that we are delivering against this aim despite the tough economic and social backdrop. We have learnt a lot and adapted quickly, and ASOS finishes the period with improved underlying profitability. While we remain cautious about the consumer impact of Covid-19 looking forward, we are on track to deliver strong year-on-year profit growth and to return to positive free cash flow for the full-year.”

Looking forward the company the backdrop of continued social distancing, ongoing restrictions of events and an uncertain economic outlook for its 20-something customers, led it to remain cautious on the short to medium term outlook on demand. However it said it expected FY20 profit before tax to be towards the top end of market expectations.

Shares were up 3% in early trading to 3,476p.

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