ASOS reports trend reversal in profitability in the first half of the year

The British fashion dealer ASOS PLC has announced a clear trend reversal in profitability in the first half of the 2024/25 financial year. The company explained the first success of the new business model, which has been implemented in the past two years, on Thursday.

For the first half of the year, the clothing provider reported an increase in the adjusted result before interest, taxes and depreciation (EBITDA) by around 60 million British pounds (70 million euros) per year. This is attributed to the revised business strategy and consistent cost management.

ASOS reports improved results for the first half of the year

In Great Britain, the largest market of ASOS, ASOS Design recorded an increase in sales of nine percent, which contributed to enlargement of the market share. In the first half of the year, the revenues of the own brands with products sold at the full price also increased again in the first half of the year.

The overall turnover of the group decreased by 13 percent in the first half of the year to £ 1.3 billion (1.5 billion euros), which corresponded to the previous forecasts and the trends from the previous financial year. According to the company, this was primarily due to the reduction of older inventory and the optimized performance marketing.

Chief Executive Officer (CEO) José Antonio Ramos Calamonte was confident with regard to the progress of the company and explained: “The first half of the 2024/25 financial year is the strongest sign that our new business model is working so far. has increased. ” It is important that “this successes were achieved together with a continued strong cost control and an improvement in our inventory”.

The company emphasized the positive response of the customers: the inside of the products and faster market launches. This was reflected in an increase in gross margin by around 500 basis points, which was achieved by reduced depreciation and a higher proportion of sales with products sold at full price.

Asos also expanded its brand portfolio and recorded over 25 new brand partners in the first six months, including Bimba y Lola, Jimmy Fairly and Oh Polly. Another 40 brands and more exclusive collections are to come onto the market in the second half of the year.

ASOS confirms the result forecasts for the current financial year

With regard to the future, the company’s initiatives include the introduction of Topshop.com, the loyalty program “Asos.world”, live shopping functions, improved search and personalization functions and the increased use of AI throughout the company.

ASOS confirmed its result forecasts for the current financial year and continues to expect a gross margin of at least 46 percent and an increase in adjusted EBITDA by at least 60 percent to 130 to £ 150 million. This should be achieved by significantly increasing the share of sales of non -price -reduced products.

For the 2024/25 financial year, a decline in sales at the lower end of the average market expectations is expected, which will provide loss by two to nine percent. The GMV should develop by one or two percentage points better than sales.