Asos FY losses widen to £379m despite turnaround progress
Despite increased losses, the group remained optimistic over its Back to Fashion turnaround plan, with ‘green shoots’ in new stock performance in recent months
Asos has seen full-year losses plunge to £379.3m, widening from its previous loss of £296.7m, as it focused on “setting strong foundations” for future growth through its turnaround plan. In the year ended 1 September 2024, group revenues fell by 18% to £2.9bn, down from £3.5bn the prior year, as the group said there was a “continued optimisation of profit contribution over revenue”.
Despite increased losses, the group remained optimistic over its ‘Back to Fashion’ turnaround plan, with “green shoots” in new stock performance in recent months, giving it “confidence that our new commercial model is delivering customers the right product at the right time”.
The group’s turnaround plan has included clearing through old stock, changing its product model to bring customers more relevant products, and exiting unprofitable activities to “invest into areas that matter most to our core customers”.
In its full-year update, the group said the “foundations of a more agile and profitable business are in place”, with stock clearance now complete and a new commercial model embedded.
Its inventory is down by around 50% since FY22 to £520m through disciplined stock management.
Asos said it has also seen evidence of progress in its new commercial model over the last quarter, with sales of newness up 24% year-on-year with only 6% more stock, “demonstrating strong demand” for full-price products.
Looking ahead, the group expects adjusted EBITDA to grow by at least 60% to between £130m and £150m in FY25. It added that its mid-term focus remains on sustainable, profitable growth, with revenue growth expected.
CEO José Antonio Ramos Calamonte said: “We achieved our key priorities for the year, significantly reducing our inventory position, while generating positive adjusted EBITDA and free cash flow. Following the year end, we further strengthened our balance sheet with our Topshop Topman joint venture and our refinancing.
“Our product is now in the strongest position it has been in years, with the right level of newness to excite customers, and we have fundamentally improved our profitability through a relentless focus on operational efficiency.”
He added: “With these solid foundations in place, we can focus on delivering experiences that delight our 20 million customers. There is much work to do, but we have already seen our efforts rewarded with new product sales increasing 24% YoY over the last three months. I am energised by the progress we have made so far and excited for the next phase of our journey.”
