Retail gross margins recover at ASOS

8th Nov 2010 10:15

Strong growth in sales from overseas drove a 50% growth in online fashion store ASOS's sales at the halfway stage.Retail sales in the six months to 30 September rose to £131.4m from £87.7m the year before. UK retail sales grew 26% to $82.4m from $65.4m but international sales are fast catching up, rising 120% to $49.0m from $22.3m. However, the 120% growth rate for the half year is slightly down from the 128% rise achieved in the first quarter.International sales now account for 37% of total retail sales, up from 25% last year.Profit before tax of £7.0m was up 59% from last year's interim figure of £4.4m, and marginally ahead of the £6.9m predicted by broker Panmure Gordon.Gross margin dipped by 60 basis points (bps) to 41.4% from 42.% the year before; Panmure Gordon had predicted a slide of 65 bps/Retail gross margin improved by 280 bps to 47.4% from 44.6%, completely blowing Panmure's prediction of a 50 bps improvement out of the water."In anticipation of continued strong growth, we have maintained our programme of investment, specifically around resource, logistics and our technical capabilities," said Nick Robertson, chief executive officer of ASOS."As we head into the important Q3 trading period, we remain positive about the outlook for the second half and expect our full year results to be in line with market expectations," Robertson said.