Britain'S Largest Fashion Business ASOS PLC Annual Profit To Achieve A 37% Rise

Britain's largest

ASOS PLC announces 2016 fiscal year in UK and international

After record strong growth, annual profits rose by 37%.

Even though the background of the continuous contraction of high street retail sales in the UK is very strong, Peel Hunt, the British brokerage firm, has lowered its bid price from 5000 pence to 4000 pence, down 20%, but maintained a "buy" rating after the annual performance of ASOS PLC.

ASOS PLC (ASC.L) shares fell sharply on the 18 th Tuesday to a maximum of 8.2% to 4897 pence.

In the fiscal year ended August 31st, retail sales in the UK and mainland markets rose by 27% and 25% to 603 million 800 thousand and 799 million 900 thousand respectively in the year of ASOS PLC.

The group's investment in the price mechanism has contributed greatly to international business, with sales in the United States rising 40% to 179 million 200 thousand pounds, Europe's 28% to 374 million 900 thousand pounds, and the world's other markets by 14% to 245 million 800 thousand pounds.

ASOS PLC CEO Nick Beighton pointed out that ASOS PLC has become an "export business" at the post earnings conference. He expects that the growth of international business can make up for the increased input and expenditure, and the group will also benefit from the depreciation of the pound.

However, the price investment has not been offset by a higher total sales price. The gross margin of retail sales has shrunk by 30 basis points, and the gross profit margin has dropped by 10 basis points to 50%, 48.5%.

The total retail sales of the group were 1 billion 403 million 700 thousand, an increase of 26% over the previous year of 1 billion 112 million 200 thousand, and total income of 1 billion 444 million 900 thousand pounds, an increase of 26% over the previous year's 1 billion 143 million pounds.

Excluding the special items and the business that has been terminated, the pre tax profit for the whole year was 63 million 700 thousand pounds, slightly better than the market expectation of 62 million pounds, a 37% increase compared with 46 million 400 thousand pounds in the 2015 fiscal year.

Reconciliation and Swiss cycling

The manufacturer's Assos of Switzerland GmbH and the German menswear retailer Anson "s Herrenhaus AG AG" trademark infringement case required 20 million 200 thousand pounds of cash has been recorded in fiscal year 2016, and will be paid in fiscal year 2017, plus 3 million 600 thousand of the pre tax loss resulting from the termination of the Chinese business and 6 million 500 thousand pounds of the closing expenses, and the actual pre tax profit fell 31% to 32 million 700 thousand pounds over the same period.

The booming sales of ASOS PLC in the UK indicate that the fashion business is clearly immune to the worst clothing market depression since the 2009 financial crisis.

Kantar Worldpanel recently released data that in the first 12 months ended September 25th, the sales of the British clothing market, which was 36 billion pounds, fell by 700 million pounds, and sales of clothing, footwear and accessories continued to shrink in the past 4 months. Abnormal weather and low consumer sentiment had affected the demand for clothing.

Nick Beighton expressed satisfaction with the progress of ASOS PLC in its earnings report, and at the performance conference, he attributed the group's outstanding performance to the rapidly changing product supply, the expansion of the international customer base and the role of social media marketing, and that these factors helped the group maintain sales growth and resist the difficult conditions of the local clothing market.

"I expect the main growth momentum comes from the international market, but I do not think the UK business will go down sharply."

As of August 31st, the number of active users of ASOS.com was 12 million 400 thousand, an increase of 25%, and the number of subscribers and orders increased by 3% and 30% respectively, up to 70.84 and 38 million 300 thousand respectively.

Social media fans increased by 54%, of which Facebook and Instagram fans reached 6 million 500 thousand and 7 million 500 thousand respectively.

Nick Beighton also revealed that the group will accelerate investment in logistics and technology to maintain the expected revenue growth of 20%-25%, and the profit margin is expected to remain stable.

For the exposure and criticism of British media and trade unions to their main warehouse work environment, ASOS PLC again stressed the fact that it was false and misleading.