Fashion etailer Asos has reported rising sales but weaker margins in its fourth quarter after a fire at one of its warehouses impacted trade.
The etailer also warned on profits for the current year. Asos boss Nick Robertson said that due to plans to make “significant investments” in international pricing, logistics and technology, the etailer expects pretax profit for the year ending Audust 31, 2015 to be “at a similar level to 2013/14”.
In the fourth quarter, retail sales were up 15% to £240m, with the UK up 33% to £98.2m and overseas up 6% to £141.7m. However, retail gross margins were down by about 640 basis points in the three months to August 31.
Asos still expects pre-tax profit to be in line with expectations.
Asos chief executive Nick Robertson said: “Our UK performance remained strong over the final quarter. However, due to the fire at our Barnsley distribution centre, we lost sales during the quarter of between £25m and £30m with a retail gross margin impact of c.200 basis points. After adjusting for insurance proceeds, we expect profit before tax for the year to be in line with market expectations.”
In the quarter, US retail sales were flat, while sales across the EU were up 21%. Sales in the rest of the world fell 5%.
In the year to August 31, retail sales increased 27% to £955.3m. Within that UK sales were up 35%, and overseas sales jumped 22%. International sales now account for 61% of total sales, down from 63% last year. Retail gross margin was down about 230 basis points.
Robertson added: “Engagement with our customers remains positive with a 25% growth in active customers and increases in order frequency, conversion rate and average basket value. Sales for the year as a whole increased by 27%.
“We remain focused on the long-term opportunity for Asos, with £2.5bn of sales as our next staging post.”