Asos reports 4Q retail sales up 15%, missing estimates

International sales rose 6 percent in the three months ended August 31, Asos said today, the slowest growth in recent memory. At constant currency rates, the gain was 14 percent.

In less than a decade, Asos has built a near £600 million international business spanning countries including Australia, China, Russia and the US International revenue has grown to represent almost two-thirds of the total, though the proportion declined to 59 percent in the year through August from 64 percent in the previous 12 months.

Asos plans to make “significant investments” in its international pricing and proposition, it said in the statement. The result is that pretax profit for the year ended August 2015 will be at “a similar level” to the previous year. Before today, analysts had forecast a 37 percent increase to £63.4 million, according to estimates compiled by Bloomberg.

The shares were down 11 percent at 2,158 pence as of 9.30 am in London, reducing the company’s market value to about £1.8 billion. A year ago, Asos was valued at more than £4 billion.

Earnings for the year just ended were in line with analysts’ reduced estimates, adjusted for insurance proceeds, Asos said. The warehouse fire reduced sales by £25 million to £30 million in the fourth quarter, according to the company, which is due to report full-year results on October 21.

Total retail sales advanced 15 percent in the three months through August, Asos said, led by a 33 percent gain in the UK.

more