The latest trading statement from fashion etailer Asos shows a sales drop of 18%, but its chief executive has stressed its turn around strategy is working.
Asos has reiterated its full year guidance in its statement for the 26 weeks to 03 March 2024, with free cash flow improved by c.£240mn compared to H1 FY23. Asos credited its “Back to Fashion” strategy for this, and its clearance of aged stock.
In fact, the retailer said it was ahead on its plan to improve stock efficiency and reduce inventory to around £600mn by the year-end.
José Antonio Ramos Calamonte, chief executive officer of Asos, said: “I’m excited by the performance of our new collections, while we have also made great progress in monetising inventory that built up over the pandemic and in improving the core profitability of our operations. We have reconfirmed our guidance for FY24 as we lay the foundations for a more profitable, cash generative business from FY25 and beyond.”
Looking ahead, the retailer estimates a 5-15% sales decline, but a positive adjusted EBITDA. It will continue to work on ensuring inventory is back to pre-covid levels, with positive cash generation and to reduce net debt.
Calamonte added: “Asos is becoming a faster and more agile business, aided by the incredible work of our teams to speed up all of our processes to deliver the fashion, quality and prices that our customers want, when they want it.”
Last month, the fashion etailer reintroduced its Asos Insider influencer programme, which features 36 “style enthusiasts” to showcase beauty and fashion products across social channels.
Hear from Asos’ director – media group, Elton Ollerhead, at the brand new retail media networks event, MediaX, on 11 June 2024 at the Cavendish Conference Centre, London.
Ollerhead will join speakers from Asda, Co-op, Deliveroo, ITV, Kingfisher Group, Superdrug, and many more. See the full line up here.
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