UK online fashion giant, Asos, has reported a modest rise in sales figures for the three months ended August 31 2014, as its results were impacted by a fire earlier this year at its UK warehouse.
Retail sales increased 15 per cent to £240 million in the three months to August 31. Sales in the UK, Asos’ largest market, recorded a 33 per cent rise in sales, while its international business grew six per cent, however, the results were impacted by a fire that was deliberately lit at the e-tailer’s main warehouse in Barnsley, northern England, earlier this year in June.
The fire forced the company to halt trade on its website and suspend orders for more than 48 hours. Around 70 per cent of Asos stock is held at Barnsley, with around 20 per cent reported to have been wiped out in the fire.
For the year ended August 31, retail sales gained by 27 per cent to £955 million, just missing its target of £1 billion. Sales in the UK increased by 35 per cent, and international sales were up by 22 per cent.
“Our UK performance remained strong over the final quarter, with sales increasing 33 per cent. Our international business grew six per cent or 14 per cent in constant currency. However, due to the fire at our Barnsley distribution centre, we lost sales during the quarter of between £25m and £30m with a retail gross margin impact of c.200 basis points. After adjusting for insurance proceeds, we expect profit before tax for the year to be in line with market expectations,” Nick Robertson, CEO, Asos, said.
“Engagement with our customers remains positive with a 25 per cent growth in active customers and increases in order frequency, conversion rate and average basket value. Sales for the year as a whole increased by 27 per cent.
“In the new financial year we’ll make significant investments in our international pricing and proposition, as well as in our logistical infrastructure and technology platform. As a result, we expect profit before tax for the year to 31 August 2015 to be at a similar level to 2013/14,” Robertson said.
“We remain focused on the long term opportunity for Asos, with £2.5billion of sales as our next staging post”.