REG - ASOS PLC - ASOS Trading Statement

ASOSAnnouncement

13/01/2022 07:05

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20220113:nRSM2798Ya&default-theme=true

RNS Number : 2798Y  ASOS PLC  13 January 2022

 

13 January 2022

ASOS plc ("the Company")

Trading Statement for the four months ended 31 December 2021

 

ASOS delivers robust results in challenging market conditions

ASOS announces intended move to London Stock Exchange's Main Market

 * Revenue growth of 5% CCY in P1, in line with guidance despite continued
industry-wide supply chain constraints and increased uncertainty following
discovery of Omicron variant

 * Continued progress against strategic priorities with successful pilot of
Partner Fulfils, soft launch of ASOS brands edit in Nordstrom stores and
online, and launch of more compelling Premier offer in key international
territories

 * Guidance for the year unchanged with revenue growth expected in the range of
10%-15% and adjusted PBT of £110m-£140m

 * ASOS announces its intention to move to the London Stock Exchange's Main
Market, expected by end of February 2022

 * Separately, ASOS today announces the appointment of Patrick Kennedy, Chairman
of Bank of Ireland Group plc and former Chief Executive of Paddy Power, as
Senior Independent Non-Executive Director and Audit Committee Chair with
immediate effect

 

                         Four months to 31 December
 £m(1)                   2021     2020     CCY(2) Increase  Reported Increase
 UK total sales          645.2    571.3    13%              13%
 EU total sales          390.2    400.6    2%               (3%)
 US total sales          172.6    161.7    11%              7%
 ROW total sales         185.1    230.5    (15%)            (20%)
 Total group revenue(3)  1,393.1  1,364.1  5%               2%

( )

(1)All numbers subject to rounding throughout this document, (2)Constant
currency is calculated to take account of hedged rate movements on hedged
sales and spot rate movements on unhedged sales, (3)Includes retail sales,
wholesale and income from other services. All references to segmental sales
throughout the document are total sales unless otherwise stated. Any reference
to total or retail sales growth throughout the document is on a constant
currency basis.

 

P1 Results Summary

 * Total sales growth of 5%, in line with our guidance. Supply chain constraints
played out as anticipated, whilst market demand remained volatile due to
significantly increased COVID caseloads across large parts of the UK, Europe,
and the US

 * Active customer base increased by 0.3m customers to 26.7m, reflecting slower
customer growth as we cycled a period of exceptional customer acquisition in
P1 FY21

 * As expected, gross margin decreased by 400 bps to 43.0% driven by heightened
clearance activity to shift slow-moving '21 spring / summer stock, elevated
freight costs, and use of air freight to circumvent supply chain constraints
and maximise peak trading. Trends expected to improve across the remainder of
the year as peak-related supply chain bottlenecks ease and stock profile
normalises

 * Low to mid-single digit price increases have been taken to mitigate cost
inflation going forward across both ASOS and partner brands

 * Returns rate has normalised in line with expectations

 

Territory Performance

 * UK delivered growth ahead of expectations at +13%, supported by strong peak
performance and demand for going out wear

 * EU grew by +2% in the period and was significantly impacted by the fourth
COVID wave, with resulting restrictions limiting events and going out
occasions

 * US delivered growth of +11% despite significant port congestion and supply
chain disruption inhibiting our ability to fully service demand

 * ROW performance of -15%, reflecting the continued impact of extended delivery
propositions

 

Business Update

 * Following a successful pilot of the Partner Fulfils programme, in partnership
with adidas and Reebok in the UK in November, the Company will expand the
model in FY22 including roll out to Europe

 * The Topshop brands continue to perform well on the ASOS platform, posting
strong growth of more than 200% year-on-year. The brands have performed well
across all regions, with the UK, Germany, and US continuing to post the
highest growth

 * ASOS successfully debuted the first edit of ASOS Design, ASOS Edition, and
ASOS Luxe in two Nordstrom stores and online, with ASOS Curve exclusively
available on Nordstrom.com

 * As outlined at the Capital Markets Day in November, ASOS remains focused on
efforts to improve the flexibility and speed of the retail model and
accelerating the pace of delivery of its international growth strategy. Next
phase includes further organisational alignment against key priorities
including the establishment of more dedicated teams in support of ASOS and
partner brands, further rollout of geographical teams and the establishment of
key operating units to drive Face + Body and Sportswear growth plans

 * Non-recurring costs incurred in relation to accelerating the ASOS strategy,
along with all costs incurred to shift ASOS' listing from AIM to the Main
Market, will be treated as adjusting items in Adjusted Profit Before Tax in
FY22. These are expected to be in the range of between £10m to £13m for the
first half

 * The Company is currently in the process of preparing a Prospectus in
connection to its application for Admission, which will be subject to approval
by the FCA. Admission is currently envisaged by the end of February 2022

 

Outlook

 * Whilst both demand and returns rate uncertainty related to the Omicron variant
are expected to remain in the short term, the guidance for the year remains
unchanged with revenue growth expected in the range of 10%-15% and adjusted
PBT of £110m-£140m

 

Mat Dunn, COO, commented:

 

"ASOS has delivered a robust start to the year, in line with the guidance we
set out at full-year results, despite challenging market conditions. This
performance reflects the strength of our offer, excellent customer experience
and the dedication and hard work of all ASOSers. We continued to make progress
against our objectives to improve the flexibility and speed of our retail
model and accelerate the pace of delivery of our international growth
strategy. Looking ahead, while mindful of the near-term uncertainty relating
to the pandemic, our guidance for the full year remains unchanged.

"We are also pleased to announce today that we plan to move to the Main Market
of the London Stock Exchange. Our listing on AIM for the past 20 years has
been an important part of ASOS' development, but the time is now right to move
to the Main Market as we focus on delivering our medium-term guidance and
longer-term growth ambitions."

 

 

 

 

 

Intended application for admission to the Main Market and cancellation of
trading on AIM

 

ASOS further announces today its intention to apply for ASOS' ordinary shares
to be admitted to the premium listing segment of the Official List and to
trading on the main market for listed securities (the "Main Market") of the
London Stock Exchange plc ("The London Stock Exchange") ("Admission"). The
Company is currently in the process of preparing a Prospectus in connection
with its application for Admission. The Company's listing on AIM will be
cancelled with effect from Admission, envisaged by the end of February
2022.

ASOS' directors believe that given ASOS' size and scale, now is the
appropriate time to move from AIM to a premium Main Market listing. Over the
past 20 years, the Company has demonstrated a proven track record, built a
broad shareholder base, and has adopted, applied and reported against the UK
Corporate Governance Code for several years. The directors consider that
Admission would further enhance the Company's corporate profile and
recognition, as well as extending the opportunity to own the Company's
ordinary shares to a broader group of global institutional shareholders.

 

Admission is subject to (i) the approval by the FCA of a Prospectus and
admission to the premium listing segment of the Official List; and (ii)
admission by the London Stock Exchange to trading of the ordinary shares on
the Main Market. Subject to satisfaction of these conditions, Admission is
expected to occur, and the Company's listing on AIM to be cancelled
simultaneously on a date not earlier than 21 February 2022 (being at least 20
business days after the date of this announcement). Accordingly, the Company
hereby gives notice of the intended cancellation of trading of its ordinary
shares on AIM in accordance with Rule 41 of the AIM Rules for Companies. ASOS
will make a further announcement on the status of the proposed applications
for Admission (and the timeline for Admission) in due course. Admission would
be effected through an introduction of the existing ordinary shares and ASOS
would not raise any funds or offer any new securities in connection with
Admission or the publication of the related prospectus.

 

Admission is not expected to be conditional upon any shareholder
approval. ASOS shareholders should consult their advisors regarding the
consequences of Admission on their personal tax position.

 

J.P. Morgan Securities plc, which carries on its UK investment banking
activities as J.P. Morgan Cazenove ("J.P. Morgan Cazenove"), is acting as
sponsor to ASOS in connection with Admission.

 

This announcement includes inside information.

 

The person responsible for arranging the release of this announcement on
behalf of ASOS is Anna Suchopar, General Counsel and Company Secretary.

 

 

 

Investor and Analyst conference call:

ASOS will be hosting a conference call for analysts and investors at 8.30am
(UK time) on 13(th) January 2022. To access live please dial 0800 640 6441 /
+44 20 3936 2999, and use passcode: 004202 A recording of this webcast will
be available on the ASOS Plc website later today:
https://www.asosplc.com/investor-relations/

 

For further information:

   ASOS                                                                                                                                                    Tel: 020 7756 1000
 plc
   Mathew Dunn, Chief Operating Officer & Chief Financial Officer

   Taryn Rosekilly, Director of Investor Relations

   Website: www.asosplc.com/investors

   Headland Consultancy                                                                                                                                    Tel: 020 3805 4822
   Susanna Voyle / Stephen Malthouse

   JPMorgan Cazenove                                                                                                                                       Tel: 020 7742 4000
   Bill Hutchings / Will Vanderspar

   Numis Securities                                                                                                                                        Tel: 020 7260 1000
   Alex Ham / Jonathan Wilcox / Tom Jacob

   Berenberg                                                                                                                                               Tel: 020 3207 7800

   Michelle Wilson / Jen Clarke

 

 

Background note

ASOS is a destination for fashion-loving 20-somethings around the world, with
a purpose to give its customers the confidence to be whoever they want to be.
Through its app and mobile/desktop web experience, available in ten languages
and in over 200 markets, ASOS customers can shop a curated edit of over 90,000
products, sourced from nearly 900 global and local third-party brands
alongside a mix of fashion-led own-brand labels - ASOS Design, ASOS Edition,
ASOS 4505, Collusion, Reclaimed Vintage, Topshop, Topman, Miss Selfridge and
HIIT. ASOS aims to give all of its customers a truly frictionless experience,
with an ever-greater number of different payment methods and hundreds of local
delivery and return options, including Next-Day Delivery and Same-Day
Delivery, dispatched from state-of-the-art fulfilment centres in the UK, US
and Germany.

 

Important information

This announcement may include statements that are, or may be deemed to be,
"forward-looking statements" (including words such as "believe", "expect",
"estimate", "intend", "anticipate" and words of similar meaning). By their
nature, forward-looking statements involve risk and uncertainty since they
relate to future events and circumstances, and actual results may, and often
do, differ materially from any forward-looking statements. Any forward-looking
statements in this announcement reflect management's view with respect to
future events as at the date of this announcement. Save as required by
applicable law, the Company undertakes no obligation to publicly revise any
forward-looking statements in this announcement, whether following any change
in its expectations or to reflect events or circumstances after the date of
this announcement.

This announcement does not constitute an offer to sell, or the solicitation of
an offer to acquire or subscribe for, shares in the Company in any
jurisdiction. The distribution of this announcement outside the UK may be
restricted by law. No action has been taken by the Company that would permit
possession of this announcement in any jurisdiction outside the UK where
action for that purpose is required. Persons outside the UK who come into
possession of this announcement should inform themselves about the
distribution of this announcement in their particular jurisdiction.

The Company's ordinary shares have not been, and will not be, registered under
the US Securities Act of 1933, as amended (the "US Securities Act"), or under
the securities laws of any state or other jurisdiction of the United States.
The ordinary shares may not be offered, sold, resold, transferred or
delivered, directly or indirectly, within the United States, except pursuant
to an exemption from, or in a transaction not subject to, the registration
requirements of the US Securities Act and in compliance with any applicable
securities laws of any state or other jurisdiction in the United States.

J.P. Morgan Securities plc (which conducts its UK investment banking
activities as J.P. Morgan Cazenove) ("J.P. Morgan"), which is authorised by
the Prudential Regulatory Authority (the "PRA") and regulated in the United
Kingdom by the PRA and the FCA, is acting exclusively for the Company and no
one else in connection with Admission and it will not regard any other person
as a client in relation to Admission and will not be responsible to anyone
other than the Company for providing the protections afforded to its clients
or for providing advice in relation to Admission or any other transaction,
matter, or arrangement referred to in this announcement.

 

 

 

 

 

Appendix 1 - Total sales growth by period in sterling

Year ending 31 August 2022

 £m                   P1(1)    YOY%   P2(1)  YOY%  P3(1)  YOY%  P4(1)  YOY%   2021/22 YTD     YOY%
     UK total sales   645.2    13%                                           645.2            13%
     EU total sales   390.2    (3%)                                          390.2            (3%)
     US total sales   172.6    7%                                            172.6            7%
     ROW total sales  185.1    (20%)                                         185.1            (20%)
     Total sales      1,393.1  2%                                            1,393.1          2%

 

Year ended 31 August 2021 (Underlying(2))

                  P1(1)    YOY%  P2(1)  YOY%  P3(1)    YOY%   P4(1)  YOY%   2020/21     YOY%

 £m
 UK total sales   571.3    35%   254.5  46%   546.1    37%    280.1  29%   1,652.0      36%
 EU total sales   400.6    18%   193.7  22%   398.3    14%    192.6  6%    1,185.3      15%
 US total sales   161.7    12%   71.2   8%    154.2    10%    79.2   21%   466.2        12%
 ROW total sales  230.5    16%   92.4   1%    187.8    (10%)  96.3   (7%)  607.0        1%
 Total sales      1,364.1  23%   611.8  25%   1,286.4  17%    648.2  14%   3,910.5      20%

 

Year ended 31 August 2020 (Underlying(2))

                  P1(1)    YOY%  P2(1)  YOY%  P3(1)    YOY%  P4(1)  YOY%   2019/20     YOY%

 £m
 UK total sales   422.4    18%   174.5  26%   399.4    16%   217.8  17%   1,214.1      18%
 EU total sales   340.5    21%   158.9  24%   349.5    27%   181.3  14%   1,030.2      22%
 US total sales   144.2    23%   65.6   32%   139.9    11%   65.6   8%    415.3        18%
 ROW total sales  198.9    24%   91.7   15%   209.3    21%   104.0  11%   603.9        19%
 Total sales      1,106.0  20%   490.7  24%   1,098.1  19%   568.6  14%   3,263.5      19%

 

( )

( )

( )

(1)Periods are as follows:

P1: four months to 31 December

P2: two months to 28/29 February

P3: four months to 30 June

P4: two months to 31 August

(2)Adjusted comparatives to reflect the underlying sales performance for prior
year returns provision phasing. Please see Trading Statement for the four
months ended 30 June 2021 on the ASOS Plc website for more information.

 

 

Appendix 2 - Total sales growth by period at constant currency

Year ending 31 August 2022

 £m                   P1(1)  P2 (1)  P3 (1)  P4 (1)  2021/22

                      YOY%   YOY%    YOY%    YOY%    YOY%
     UK total sales   13%                            13%
     EU total sales   2%                             2%
     US total sales   11%                            11%
     ROW total sales  (15%)                          (15%)
     Total sales      5%                             5%

 

Year ended 31 August 2021 (Underlying(2))

                  P1(1)  P2 (1)  P3 (1)  P4 (1)  2021/22

 £m               YOY%   YOY%    YOY%    YOY%    YOY%
 UK total sales   35%    46%     37%     29%     36%
 EU total sales   17%    20%     15%     4%      15%
 US total sales   16%    13%     24%     32%     21%
 ROW total sales  20%    9%      (3%)    (4%)    6%
 Total sales      24%    26%     21%     15%     22%

 

Year ended 31 August 2020 (Underlying(2))

                  P1(1)  P2 (1)  P3 (1)  P4 (1)  2021/22

 £m               YOY%   YOY%    YOY%    YOY%    YOY%
 UK total sales   18%    26%     16%     17%     18%
 EU total sales   23%    25%     25%     14%     22%
 US total sales   20%    34%     6%      9%      15%
 ROW total sales  24%    15%     20%     13%     19%
 Total sales      21%    24%     18%     14%     19%

 

 

 

(1)Periods are as follows:

P1: four months to 31 December

P2: two months to 28/29 February

P3: four months to 30 June

P4: two months to 31 August

(2)Adjusted comparatives to reflect the underlying sales performance for prior
year returns provision phasing. Please see Trading Statement for the four
months ended 30 June 2021 on the ASOS Plc website for more information.

 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  TSTBTMLTMTABBMT