ASOS can face US tariffs fallout due to improved agility, flexibility
British online fashion retailer ASOS posted higher half-year earnings for the 26 weeks to March 2, saying it can cope with the fallout from US tariffs due to 'improved agility and flexibility' of its sourcing and distribution model despite facing new upheavals from tariffs and trade turmoil.
Its half-year adjusted earnings (EBITDA) for the period was £42.5 million (~$56.57 million). The company said it is on track for annual earnings to hit £130-£150 million (~$173.04-199.7 million).
ASOS posted higher half-year earnings for the 26 weeks to March 2, saying it can cope with the fallout from US tariffs due to 'improved agility and flexibility' of its sourcing and distribution model despite facing new upheavals from tariffs and trade turmoil. Its half-year adjusted earnings for the period was $56.57 million. It said it is on track for annual earnings to hit $173.04-199.7 million.
The United Kingdom is ASOS's biggest market, but the United States accounts for about 10 per cent of its total sales.
Customers are responding well to increased newness and speed to market as gross margin was up year on year (YoY) in the first half (H1) of fiscal 2024-25 of the company, driven by lower markdown activity and higher full-price mix, demonstrating strength of new commercial model offering, the company said in its summary of financial results.
In the United Kingdom, total ASOS Design sales rose by 9 per cent YoY in H1. Globally, own brand full-price sales returned to YoY growth in the first half.
"H1 FY25 is the strongest sign yet that our new commercial model is working. We are driving a significant transformation in profitability, with positive adjusted EBITDA up by c.£60 million YoY. Customers are responding positively to our focus on full-price sales, speed to market, and quality,' Jose Antonio Ramos Calamonte, chief executive officer said.
'These successes have been achieved whilst maintaining strong cost control and improving our inventory health. We look forward to a fantastic pipeline of new products, brands and customer experiences, and remain confident in our ability to deliver sustainable, profitable growth," he added.
Initiatives in the second half include launching Topshop.com, ASOS.WORLD loyalty programme, live shopping features, enhanced search and personalisation, as well as further leveraging artificial intelligence across the business.
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