All’s well that ends well it seems. Having taken a tumble in July, when bosses admitted annual revenues would grow at a rate towards the lower end of expectations, shares in online fashion group Asos (ASC) rebounded 15 per cent on the back of these full-year numbers. The market reaction suggests investors were more than satisfied with the eventual increase in the top-line and statutory profits, the latter of which trumped the consensus and the adjusted pre-tax forecast of Peel Hunt. Analysts at the broker still expect to see an 18 per cent hike in adjusted profits for FY2019, equating to EPS of 114p (from £102m and 98p in FY2018).
The £43m net cash position marks a significant decrease year-on-year, but reflects a serious 12-months’ worth of investment, particularly across warehousing and technology capabilities, not mention a one-third build in inventory. Asos isn’t treating many of these “above the line” costs as exceptional items, either. For example, £25m in warehouse transition costs and a £2.7m charge for writing off its loyalty programme were all worked into general expenses. Even so, operating profits still rose by an impressive 28 per cent to £102m.
ASOS (ASC) | ||||
ORD PRICE: | 5,644p | MARKET VALUE: | £4.72bn | |
TOUCH: | 5,640-5,646p | 12-MONTH HIGH: | 7,770p | LOW: 4,500p |
DIVIDEND YIELD: | nil | PE RATIO: | 57 | |
NET ASSET VALUE: | 525p* | NET CASH: | £43m |
Year to 31 Aug | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
2014 | 0.98 | 46.9 | 44.6 | nil |
2015 | 1.14 | 52.7 | 49.4 | nil |
2016 | 1.44 | 42.8 | 41.8 | nil |
2017 | 1.92 | 80.0 | 77.2 | nil |
2018 | 2.42 | 102 | 98.9 | nil |
% change | +26 | +28 | +28 | - |
Ex-div: | na | |||
Payment: | na | |||
*Includes intangible assets of £258m or 309p a share |