In the first half ended Feb. 28, the British online retailer Asos more than tripled pre-tax profits to a record £106.4 million (€122.8m-$145.8m) and raised full-year expectations as it continues to benefit from the Covid-19 pandemic.
While the switch to online shopping during lockdowns boosted trading, Asos was cautious over the uncertain economic outlook for its core 20-something customers and warned that shopping habits would change once clothing stores reopen in England and Wales on April 12.
“In the coming months we expect a portion of consumer demand will move back to stores as restrictions are eased throughout our markets, but we expect online penetration to remain structurally higher than pre-Covid-19 levels,” Asos said.
Pre-tax profits for the six months to Feb. 28 surged by 253 percent as group revenues rose by 24 percent to £1.97 billion (€2.3bn-$2.7bn). Full-year expectations were lifted in line with the first half performance, while second half guidance remained unchanged.
Asos said £48.5 million (€56.2m-$66.7m) of profits were a Covid “tailwind”, and warned that this benefit was likely to end with the lifting of curbs on hospitality and tourism, giving consumers more spending options. Strong growth was reported in “lockdown” clothing categories, including a 68 percent rise in activewear sales. Active customer numbers rose by 1.5 million to 24.9 million despite a fall in “event-led” sales for formalwear.
The company hailed an “exceptional” performance in the U.K., where sales rose by 39 percent. The EU saw sales grow by 18 percent, while the U.S. and rest of world each saw growth of 16 percent.
The Topshop and Miss Selfridge brands as well as the activewear label HIIT, acquired from Arcadia for £330 million (€382.5m-$454m) in February, had been “seamlessly” integrated into its online platform and had achieved “great early customer momentum”.