ASOS says it expects 'significant improvement' in sales amid takeover rumours
ASOS has today announced that it "expects a significant improvement" in profitability for the first half of 2025 ahead of publishing its results on 24 April. Meanwhile, the billionaire owner of Danish fashion empire Bestseller has upped his stake in the online retailer.
ASOS said its improved financial sheet was thanks to its strong gross margin development driven by lower markdown activity, increased full-price mix and continued cost discipline.
Its own brand full-price sales returned to growth in the first half. This was enabled by its market-leading Test & React model, now more than 15% of own-brand sales and growing.
In the same week, the company's shares skyrocketed by nearly 11% as Danish billionaire Anders Holch Povlsen increased his stake from 27% to 28%. Should he reach 30%, he would be required to make a formal takeover offer under UK rules.
Dan Coatsworth, an AJ Bell analyst, told This is Money: "Povlsen might feel Asos is better taken off the market and nursed back to health out of the spotlight."
Holch Povlsen is Britain’s biggest landowner, with an estimated fortune of £6.3 billion. However, he owes his wealth to Bestseller, the fashion empire, which recently acquired Topshop and Topman from ASOS.
In October 2024 ASOS sold Topshop and Topman to a joint venture led by Heartland, which represented ASOS shareholder Anders Holch Povlsen and Bestseller.
The joint venture was established following a competitive sale process for the brands and saw Heartland indirectly hold a 75% stake in the joint venture for a £135 million cash consideration.
The remaining 25% stake is held by ASOS Holdings Limited, granting the online fashion retailer certain design and distribution rights for Topshop and Topman in return for a royalty fee, allowing it to continue marketing and selling the two brands online.
Thanks to Bestseller, it's suspected that Topshop is headed back to the British high street. Read 'Topshop teases return to the high street' to find out more.
