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(Sharecast News) - UK-based online fashion retailer ASOS said first-half sales fell 18% but held guidance for a decline over the full year as a turnaround plan started to take shape.
Asos, which has seen its share price halve over then last year, said it still expected annual sales to be 5-15% lower. Chief executive José Antonio Ramos Calamonte has focused on shifting excess stock and launching new collections and still expects to post positive core earnings.
"I'm excited by the performance of our new collections, while we have also made great progress in monetising inventory that built up over the pandemic and in improving the core profitability of our operations," Calamonte said in a trading statement for the half year to March 3.
He said ASOS was making "good progress" on implementing its 'Back to Fashion' strategy, including action to clear aged stock and transition to a new operating model by 2025.
The company was also ahead of schedule to improve stock efficiency and reduce inventory to £600m by the end of the financial year.
Calamonte added that the plans to accelerate goods from design to site in two-to-three weeks were tracking at 5% of own-brand sales, "increasing our agility in responding to rapidly evolving customer demand".
Free cash flow improved by £240m year on year due to improvements in underlying profitability and the clearance of aged stock. ASOS had a cash balance of more than £330m, an improvement of more than £20m from the first half of 2023.
Reporting by Frank Prenesti for Sharecast.com
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