1H16 ended February 29, 2016; 1H15 ended February 28, 2015.
Source: Company reports
1H16 RESULTS
UK-based global online fashion retailer ASOS reported 1H16 revenue growth of 21.2%, to £667.3 million, which was in line with the consensus estimate.
The company reported that EBIT was up 16.6%, to £21.0 million, beating expectations of £19.9 million. Diluted adjusted EPS was up 15.3%, to 20.3 pence, versus consensus of 19.0 pence.
EBT was up 17.8%, to £21.2 million, above the consensus of £20.3 million. Profit for the period was £15.2 million, an increase of 6.3% versus 1H15.
Strong sales and continued leverage in warehouse costing offset investments in price, fulfillment and marketing, which resulted in profit growth.
PERFORMANCE BY GEOGRAPHY
UK retail sales increased by 25.0%, to £289.5 million, following a strong Christmas trading period and continual improvement in the company’s market proposition in the country.
Retail sales in the US were up 41.0% in reporting currency, to £76.8 million, following further expansion of the brand offering, price investments and increased participation in the company’s premier membership program.
EU retail sales grew by 23.0% in reporting currency, to £167.9 million, as a result of continued price investments and proposition expansion.
Retail sales in the Rest of World segment increased by 10.0% in constant currency, to £114.4 million. The company commented that sales growth of this geographic segment continued to be affected by adverse currency movements.
ASOS will discontinue its in-country operations in China over the coming months, but will continue to serve the market via ASOS.com. The company incurred a loss of £2.7 million in its China operations during 1H16.
GUIDANCE
ASOS expects to deliver results that are in line with market expectations for FY16, with sales growing by 20% and operating margin at about 4.0% for the full year.
Analysts estimate that ASOS will generate £1.4 billion in revenue in FY16, along with £58.0 million in EBIT and £50.1 million in net income.
