Asos boss Nick Robertson reinforced he is building a global giant as he predicts overseas will account for 90% of sales in four years time.
Asos’ share price tumbled last month after it warned that margins would be hit by it upping investment. But Robertson remained defiant on Asos’ strategy and said: “We’re not about driving short term profit”.
He said: “Come on guys, in H1 we added £120m to the top line. H&M and Zara have proven how big fashion can be on a global scale. If we are setting our sights on a business two and half the size of the one we have today we have to invest and the cheques you have to sign are bigger.”
Asos first-half pre-tax profits fell 22% to £20.1m in the six months to February 28.
Asos, which is on track to hit £1bn sales this year, is targeting “£2.5bn as the next staging post on our journey”. Analysts believe the retailer will reach this target in the next four years.
When asked what the sales mix will look like, Robertson said: “I’ll be amazed if the UK is more than 10% of sales.”
Robertson said by ramping up investment, overseas sales -which grew 35% in the first half - would propel.
He said its European returns hub, which will open in Berlin this month, will enable same day delivery in Germany. It will also allow next day and later delivery cut-offs in France which he said would boost sales.
He also said that further international launches were on the cards and identified Korea and Japan as potential expansion targets.
The Chinese business, where it launched a country specific website in October, will also ramp up in the next two to three years. Robertson said it will also launch on Chinese etailer Tmall with a limited collection to build awareness.
Robertson said UK sales, which jumped 32% to £182m in the first half, were being driven by the improvements it had made to delivery as well as new brands such as New Look and Jack Wills joining its website.
Membership to Asos Premier, its free next day delivery service, had doubled in the past year according to Robertson. He said customers signed up to Premier tend to spend more.
Asos is trying to cultivate loyalty by piloting a rewards scheme with 300,000 customers, which it launched last month.
Robertson added that the economic conditions remained flat in the UK. He said: “Our customers are not feeling any better. There’s a few more in employment maybe. Are the banks getting any more easier on giving credit? Probably not. There has been no seismic change for our customers.”