11th Oct 2021 09:01
(Alliance News) - ASOS PLC on Monday revealed Chief Executive Nick Beighton will leave the online clothing retailer as part of a board shake-up, with the firm's annual results also showing a profit hike.
However, the fast fashion firm warned on profit in the year ahead due to cost pressures, the falling away of Covid-19-related tailwinds and supply chain issues.
Shares in ASOS were down 14% at 2,401.00 pence in London early Monday. The stock has fallen 50% so far in 2021.
Revenue for the financial year to August 31 jumped 20% to GBP3.91 billion from GBP3.26 billion the previous year. Retail sales grew 19% to GBP3.78 billion, while pretax profit rose 25% to GBP177.1 million from GBP142.1 million the year before.
However, sales growth in the year ahead is expected to be in the range of 10% to 15%, with interim revenue growth in "mid-single digits", reflecting tougher comparables and industry-wide supply chain pressures.
ASOS expects sales to accelerate in the second half of the year and has laid out plans to generate GBP7 billion of annual revenue over the medium-term. A normalised returns rate is expected for financial year 2022.
Adjusted pretax profit for the 2022 financial year is expected between around GBP110 million to GBP140 million. This would be well below the GBP193.6 million registered for the financial year just ended.
ASOS flagged "notable cost headwinds", including inbound freight costs, Brexit duty annualisation, outbound delivery costs and labour cost inflation as factors limiting growth. It also said financial 2021 adjusted profit included a Covid-19-related tailwind of GBP67.3 million, driven by lower returns rates.
"Looking ahead, while our performance in the next 12 months is likely to be constrained by demand volatility and global supply chain and cost pressures, we are confident in our ability to capture the sizeable opportunities ahead," said Chief Financial Officer & Chief Operating Officer Mat Dunn.
ASOS shook up its board to "underpin delivery of the next phase of its global growth strategy". CEO Beighton is stepping down after 12 years with ASOS, including six as CEO, a search is underway for his replacement.
CFO Dunn has added the COO role and will run day-to-day operations, effective immediately. Katy Mecklenburgh, currently director of group finance, has become interim CFO.
Chair Adam Crozier, whose decision to step down was previously announced, will be succeeded by Senior Independent Non-Executive Director Ian Dyson. Dyson will depart from his non-executive role at SSP Group PLC.
"Over the last three years we have made significant progress...At the same time, however, we recognise that there is more to do to accelerate the pace and intensity of commercial execution," said Crozier.
By Will Paige; [email protected]
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