Asos UK sales soar 24 per cent after biggest ever trading week over cyber weekend
Online retailer Asos said UK sales rocketed after customers rushed to cash in on "cyber weekend" deals, but gains were offset by disappointing international sales.
The results
Total retail sales increased by 8 per cent to £246m in the three months to November 30. However, this has slowed from the previous quarter, where they grew by 15 per cent.
The figure received a boost from an impressive UK performance, whereby retail sales rose 24 per cent to £105m. Yet this was dragged down by international retail sales, which grew by just two per cent to £142m during this period.
"International trading conditions remain challenging," chief executive Nick Robertson said in the trading statement. It has been hurt by a strong pound as well as heavy investing in efforts to boost international operations.
Asos shares were down around 6 per cent in mid-morning trade.
Why it's interesting
Asos was one of many online retailers which slashed the price of goods as part of Black Friday and Cyber Monday. Its website offered customers 20 per cent discounts on all orders up to £500 over this period.
It looks like its discounting endeavours paid off, with chief executive officer Nick Robertson saying Asos had its "biggest ever trading week over cyber weekend in November".
Earlier this year, a fire at its Barnsley warehouse in South Yorkshire had forced the company to suspend its website sparking fears of a lengthy time out of action.
Today the company said it had received £6.3 million of insurance proceeds related to the Barnsley incident, which it will put towards its strategy to drive international sales.
The company, which has issued three profit warnings this year, also assured investors full-year profits would be in line with expectations.
What Asos said
Nick Robertson, chief executive officer, said:
Total retail sales for the quarter grew by 8% (12% on a constant currency basis). September and October were challenging as we completed the automation programme in Barnsley in time for peak. Our sales have since gathered momentum and we had our biggest ever trading week over cyber weekend in November.
Our strong UK performance continued at +24%, however international retail sales declined by 2% (growth of 4% at constant currency). International trading conditions remain challenging.
We have commenced investment into our international pricing and have started to roll out our zonal pricing capability, which combined will help us to address our international performance. We continue to focus on our major investment programmes, upgrading our IT platform and investing in our logistics capability.
During the quarter, we received £6.3 million of insurance proceeds related to the fire at Barnsley in June, which we are deploying to accelerate our investment in international pricing. After taking this into account, we expect full year profits to be in line with expectations.
In short
Thanks to Cyber Monday and Black Friday the online-only fashion retailer made record sales, but this wasn't enough to boost its overall performance.