Fashion Retailer ASOS Hopes Cost Savings Will Help Profits In FY23

Author: Shivani Kumaresan | January 12, 2023 07:59am

• Online fashion retailer ASOS Plc (OTC:ASOMF) said cost-saving measures amounting to more than £300 million would help drive profits in FY23.
• The cost mitigation measures are already in the delivery phase, whose benefits are expected to be strongly H2-weighted. 
• The company said that these are expected to more than offset headwinds from inflation and return rates annualization throughout the year to generate a modest improvement in full-year profitability from an expected H1 FY23 loss.
• The cost-saving measures include winding down three ancillary storage facilities in H2 FY23, office space rationalization, removal of unprofitable brands, reducing staff costs and implementing low-single-digit price increases.
• For the four months to Dec. 31, 2022, sales declined 3%, CCY change ex Russia, reflecting challenging trading conditions. On a reported basis, total group revenue for four months fell 4% to £1.336 billion.
• “We are undertaking necessary strategic and operational changes, with our focus shifting from prioritising top-line growth to building a more relevant and competitive fashion business with a disciplined approach to capital allocation and ROI,” said CEO Jose Antonio Ramos Calamonte.
• Price Action: ASOMF shares closed at $6.42 on Wednesday.
• Photo Via Company

Posted In: ASOMF