Asos sales surge during lockdown as international markets drive growth

The online fashion giant recorded a 10% increase in group revenue to £1bn during the four months to June 30. 

Sales growth was driven by its international markets, where retail sales climbed 17% to £654m across the quarter.

Its operations in the EU performed particularly strongly, as revenues spiked 22% to £328m. That compared to a 1% dip in sales to £329m in the UK and 3% growth in the US, where sales totalled £125m.

Asos hailed 16% growth in its active customer base to 23 million during the quarter, driven by new international shoppers using its platform during global lockdowns.

Gross margins slipped 70bps during the period.

Asos said it would repay all money previously claimed via the furlough scheme to the UK government as its employees return to work. 

The group’s full-year profits are expected to come in at the top end of market expectations, but Asos said it remained “cautious on the short- to medium-term outlook on demand” as restrictions around events remain in place across the world. 

Asos chief executive Nick Beighton said: “This has been a tough time for all businesses, but we have remained focused on doing the right thing for our people and our customers and making sure that we emerge from the current crisis as a stronger and better organisation. 

“Our performance in Q3 shows that we are delivering against this aim despite the tough economic and social backdrop. We have learnt a lot and adapted quickly, and Asos finishes the period with improved underlying profitability. 

“While we remain cautious about the consumer impact of Covid-19 looking forward, we are on track to deliver strong year-on-year profit growth and to return to positive free cash flow for the full year.”