Asos profits plunge 87% after difficult year

Little Mix Asos campaign Image copyright ASOS
Image caption Pop group Little Mix had a cover shoot with Asos magazine in November

Online fashion retailer Asos has seen its profits plunge, after a difficult year caused by heavy discounting and website traffic issues.

Asos’ pre-tax profits fell 87% to £4m for the six months to 28 February against the same period in 2018.

The firm said it had managed to stabilise sales, which rose 14% to £1.3bn for the period.

Asos said marketing changes meant a fall in visits to its websites and a drop in its search engine rankings.

Chief executive Nick Beighton said that Asos had identified a number of things it “can do better”, and that heavy investment in its platforms gave the retailer “increased confidence” that its performance would improve in the second half of the year.

He added that the global fashion industry was growing and now worth more than £220bn.

“We now have the tech platform, the infrastructure, a constant conversation with our growing customer base who love our own great product and the constantly evolving edit of brands we present to them,” said Mr Beighton.

“We believe that ultimately there will only be a handful of companies with truly global scale in this market. We are determined that Asos will be one of them.”

Asos said its financial guidance for the year remained the same.

In December, Asos warned on profits, saying that cutting prices to match rivals had not led to a significant increases in sales. Asos shares fell by almost 40%.

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