ASOS Slowing U.S. And European Business Slowdown In International Sales Growth In The Three Quarter

ASOS the UK market remained stable, and retail sales rose 22.8% to 288 million, up from 35.9%.

The three quarter earnings report released by ASOS PLC (ASC.L) today showed a significant slowdown in international sales growth during the period, the largest local online in the UK.

Retailers therefore lowered their annual growth forecasts, leading to a sharp fall in share prices in early trading, up to 11.6%, the biggest decline since April.

Compared with the same period last year, the number of active users, the unit price and the average order frequency of the three quarter increased by 20%, 1% and 8% respectively, and the conversion rate increased by 10 basis points.

Competitors such as ASOS PLC and Zalando SE (ZALG.DE), Boohoo.com PLC (BOO.L) are increasing heavy investments in technology and logistics to maintain strong growth.

Nick Beighton pointed out at the conference call after the earnings report that behind the growth of ASOS PLC PLC is to continuously meet the needs of the product while carrying out key infrastructure projects.

A few weeks later, a 1 million square foot logistics center in Atlanta will be put into use. In the early September, second "Eurohub (European hub)" automated distribution centers in Berlin, Germany, will also begin operation.

Analysts at Peel Hunt, a brokerage firm, said that before the two new warehouses were operated, ASOS PLC slowed down the business in the US and Europe, which caused the two big ones.

Reasons for slowing down.

Nick Beighton explains that the upgrading pition of Berlin's logistics system has restricted the sales in the last quarter of the European continent. However, the new distribution center can increase its processing capacity to 20 million products, which will help the group increase its supply of products in Europe after leaving Europe.

Chart: quarterly sales growth of ASOS PLC over the past ten years

After the gross profit margin of ASOS PLC PLC was expected to improve by 130 basis points in the three quarter, the group believed that the gross profit margin could be raised by 100 basis points throughout the year, and the pre tax profit would also increase by 26.3% than the 80 million in the 2017 fiscal year, reaching the market expectation of 101 million pounds.

Nick Beighton revealed that sales have been good since June 30th, and that the selling rate of positive price sales is even better.

Earlier this month, the group appointed Adam Crozier, the CEO and director of several listed companies, as chairman of the board. He will take the Brian McBride after the annual general meeting of shareholders in November.

Towards midday, ASOS PLC (ASC.L) fell narrowed to 10.5%, reporting 5820 pence, expanding the cumulative decline to 15.2% in 2018. The market value is now about 5 billion 480 million pounds, which is 400 million pounds higher than the largest British clothing retailer Marks and Spencer Group PLC (MKS.L) Marsha general merchandise, but P/E reaches 67x.