Yahoo Finance Asos sales up but bosses warn of Covid uncertainty
Online fashion giant Asos voiced caution over how the rest of the global Covid pandemic will play out as said it expects volatility in the months ahead.
The retailer also highlighted that profits are being squeezed in part due to increased freight costs and global supply chain disruption.
But bosses remain optimistic for the future, highlighting the ever-growing demand for online clothes and a boom in sales during the four months to June 30 – despite high streets reopening as lockdown restrictions eased.
Customers have also taken advantage of the recent lockdown easing, with more dresses and “occasion wear” rising in popularity.
The company said in an update to the stock market: “Trading in the last three weeks of the period was more muted, as continued Covid uncertainty and inclement weather, particularly in the UK, impacted market demand.
“We anticipate a measure of volatility to continue in the near term, given the rapidly evolving Covid situation worldwide.”
It added that there was a “strong performance in the UK, with increased promotional activity to capture the available demand for our compelling product offer, despite the reopening of physical stores early in the period.
“The final weeks of June saw a softening, due to the impact on consumer demand of continuing Covid uncertainty and unseasonal weather.”
Sales in the four months to June 30 jumped 31% to £1.29 billion, including a 60% rise in UK sales to £526.4 million – the strongest growth of any of its markets.
The US saw growth of 31% to £144.8 million – although this was helped by currency fluctuations in Asos’s favour – and the EU was slower at 20% to £388.3 million.
Chief executive Nick Beighton said: “Asos has delivered another strong performance against a backdrop of continued social restrictions and global supply chain pressures.
“Although mindful of the continued impacts of the pandemic on our customers in the short term, we believe that the structure of the global e-commerce fashion market has changed forever, which will drive an increase in online fashion sales over the long term.”
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