Just like many other retailers who solely operate online, Asos has benefited greatly in recent months from the coronavirus crisis. Especially the profit of the British fashion webshop rose spectacularly, which opens doors to further expansion.
Covid boom
In the past six months, Asos recorded a total turnover of 1.98 billion pounds (2.3 billion euros), almost a quarter higher in comparison to the same period last year. Growth was particularly striking in the United Kingdom (+39 per cent), but Asos also achieved strong growth figures in the rest of Europe (+18 per cent) and the United States (+16 per cent). The number of active customers increased by 1.5 million to 24.9 million. Adjusted operating profit (excluding one-off acquisition and integration costs of Topshop, Topman, Miss Selfridge and HIIT) rose by a massive 236 per cent to 116.2 million pounds (135 million euros). Asos estimates the benefit of the Covid crisis at 48.5 million pounds (56 million euros).
The British webshop, mainly known for party attire and “occasion wear”, succeeded in tailoring its offer further to customers who work from home. The shift to leisurewear, which manifested itself earlier during the pandemic, also continued over the past six months.
Faith in the future
The company does assume that this advantage is largely temporary and that profitability will normalise as social restrictions are lifted in more countries. “We believe that the shift to online retail as a result of the pandemic and the accelerated consolidation of offline retail has increased consumer confidence in online shopping. We expect some consumer demand to return to stores in the coming months as restrictions in our markets are eased, but at the same time, we expect online penetration to remain structurally higher than pre-pandemic times,” Asos said in a statement.
CEO Nick Beighton, therefore, says the result opens doors to more acquisitions. “We’re building our business to be a substantially greater business with a 10-year view…It’s highly likely to achieve those goals we would pick up some other brands or acquisitions along the way,” he told Business of Fashion. He will be selective with candidates: “It’s got to be fashion, it’s got to be something our 20-somethings care about, it’s got to be a strong return for our (share) holders.”
