16th Sep 2014 06:46
LONDON (Alliance News) - Online fashion retailer ASOS PLC Tuesday said its sales growth slowed in the final quarter of its financial year, as the fire that broke out at its warehouse in Barnsley in June wiped GBP25 million to GBP30 million off sales in the quarter, but it said it expects pretax profit for the recent year to be in line with market expectations.
In the UK, retail sales growth slowed to 33% in the three months to August 31, while international sales rose only 6%. International retail sales accounted for 59% of total sales, down from 64% last year.
"However, due to the fire at our Barnsley distribution centre, we lost sales during the quarter of between GBP25 million and GBP30 million with a retail gross margin impact of around 200 basis points. After adjusting for insurance proceeds, we expect profit before tax for the year to be in line with market expectations," said Chief Executive Nick Robertson in a statement.
ASOS said its retail gross margin is down around 640 basis points on the prior year.
A criminal investigation was launched into a fire at the company's main distribution centre in Barnsley at the end of June, which ASOS initially said had destroyed around 20% of its stock at the site.
The fire broke out just weeks after the online retailer saw more than GBP1 billion wiped off its market value when it said it was lowering its profit guidance for the current financial year and next year, due to heavy discounting and sterling strength, which it said took a big chunk out of its international business.
Going forward, ASOS said that due to significant investments in expansion, pricing and infrastructure, its profit for the current financial year will be flat.
"In the new financial year we'll make significant investments in our international pricing and proposition, as well as in our logistical infrastructure and technology platform. As a result, we expect profit before tax for the year to 31 August 2015 to be at a similar level to 2013/14," said Robertson.
By Rowena Harris-Doughty; [email protected]; @rharrisdoughty
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