ASOS
(ASC)
on
Wednesday
reported
a
markedly
weaker
half-year
financial
outcome,
though
the
online
retailer
said
its
turnaround
plan
is
progressing.
The
shares
were
down
12%
at
561.03p
each
in
London
on
Wednesday
morning,
the
worst
FTSE
250
performer.
For
the
six
months
to
February
28,
revenue
declined
by
8.2%
to
£1.84
billion
from
£2
billion
a
year
earlier.
Its
pretax
loss
widened
to
£290.9
million
from
£15.8
million
a
year
ago.
ASOS
said
it
is
committed
to
ending
the
financial
year
with
a
better
inventory
position.
“In
addition
to
widespread
cost
of
living
concerns
and
their
impact
on
discretionary
spend,
consumers
have
returned
to
stores
post-pandemic
causing
online
penetration
to
step
back
in
the
short-term,”
ASOS
added.
ASOS
said
its
gross
margin
fell
to
36.1%,
from
43.1%
a
year
earlier.
Its
adjusted
gross
margin
was
largely
flat
year-on-year
at
42.9%.
Back
in
October,
ASOS
announced
a
turnaround
plan.
It
said
it
would
look
to
improve
inventory
management,
reduce
its
costs
and
“reinforce”
its
leadership
team
and
culture.
The
plan
was
one
of
Jose
Calamonte’s
first
acts
as
chief
executive.
“Our
focus
is
on
improving
our
core
profitability
…
against
some
very
challenging
trading
conditions,”
CEO
Calamonte
said
on
Wednesday.
Calamonte
added:
“I
am
very
confident
of
our
return
to
sustainable
profit
and
cash
generation
in
the
second
half
of
the
year
and
beyond.”
ASOS
cautioned
its
free
cash
outflow
for
the
year
will
be
£100
million,
the
bottom
of
guidance
range
which
starts
at
breakeven.
ASOS
shares
are
considered
to
be
significantly
undervalued,
according
to
Morningstar
analysts.
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