Online fashion retailer ASOS (ASC) reported another year of high double-digit earnings growth after customer numbers swelled 42 per cent in the period to 7.1m. Moreover, the group gross margin improved by 60 basis points to 51.8 per cent.
Helped by global expansion, group retail sales rose 40 per cent to £754m - driven by 34 per cent growth in the UK to £276m, and a 44 per cent rise in overseas sales to £478m. ASOS demonstrated its ability to compete on price, too, and a 6 per cent fall in average selling prices resulted in mere 1 per cent decline in average basket value - but average units per basket rose 5 per cent.
Management continued to invest across the business as well with improvements in product, pricing, delivery, staff, marketing and infrastructure. This pushed operating costs up 45 per cent, but group adjusted profit still grew 19 per cent to £54.5m. Over the next two years, ASOS will spend £110m on beefing up its logistics operations, which could include a new fulfilment centre in northern Europe and will see the existing facility at Barnsley expanded. Management also revealed that ASOS's Chinese website is to launch any day now.
Broker Numis Securities expects pre-tax profit of £68.5m for 2014, giving EPS of 62.8p (2013: 49.2p).
| ASOS (ASC) | ||||
|---|---|---|---|---|
| ORD PRICE: | 5,230p | MARKET VALUE: | £ 4.32bn | |
| TOUCH: | 5,216-5,234p | 12-MONTH HIGH: | 5,774p | LOW: 2,104p |
| DIVIDEND YIELD: | NIL | PE RATIO: | 104 | |
| NET ASSET VALUE: | 193p* | NET CASH: | £71.1m | |
| Year to 31 Mar | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2009 | 165 | 14.1 | 13.6 | nil |
| 2010 | 223 | 20.3 | 20.0 | nil |
| 2011 | 340 | 15.7 | 14.6 | nil |
| Year to 31 Aug | (£m) | (£m) | (p) | (p) |
| 2012† | 553 | 40.0 | 38.1 | nil |
| 2013 | 769 | 54.7 | 50.1 | nil |
| % change | +39 | +37 | +31 | - |
Ex-div:- Payment:- *Includes intangible assets of £39.7m or 48p a share † pro forma figures | ||||
