10th Nov 2021 10:39
(Alliance News) - ASOS PLC on Wednesday said it is confident of hitting its medium-term targets due to its "significant further growth potential" in the UK, Europe, US and other core territories.
The London-based online clothing retailer is targeting GBP7.0 billion of sales in the next three to four years, equalling a compound annual growth rate of 15% to 20%.
Revenue for the financial year ended August 31 was GBP3.91 billion.
The group says it plans to add GBP1 billion of revenue from its own brands, and will expand the rollout of "partner fulfils" to represent 5% of its gross merchandise volume and continue to grow in the UK market as well as attempting to double its presence in the US and European market.
ASOS asserts confidence that strong sales growth can be sustained across all territories long-term. The online retailer states that this could also include a greater contribution from "partner fulfils" that could reach up to 25% of gross merchandise volume in the future.
It noted it currently has earnings before interest margins of 7% in the UK, 2% in Europe, losses of 6% in the US and 4% in the rest of the world.
With a compound annual growth rate of 15% to 20%, cost and scale efficiency and more contribution of "partner fulfils," ASOS expects long-term earnings before interest margins of at least 8%.
"Today we are setting out the detail behind our plan to significantly increase ASOS' sales and profitability across the medium and longer-term. ASOS has a clear focus on meeting the needs of our consumers, and we have created a winning offer underpinned by our best-in-class customer experience. Our plan will ensure that we fully leverage our strong, scalable global platform to deliver our ambitions," Chief Operating Officer Mat Dunn said.
Shares were up 0.4% and 2,651.6 pence on Wednesday morning in London.
By Abby Amoakuh; [email protected]
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