ASOS upbeat on outlook as profits rise
LONDON (Reuters) - British online fashion retailer ASOS (ASOS.L) posted an 11 percent rise in first half profit and remained positive on its outlook for the year, saying trading momentum was strong.
While the UK's traditional high street stores have suffered as consumers worry about job security and squeezed household incomes, online retailers are faring far better, with ASOS in particular bucking the gloom.
Its shares have more than doubled over the last year, closing Monday at 2,988 pence, valuing the business at 2.46 billion pounds.
ASOS, whose celebrity fans include United States First Lady Michelle Obama, said on Tuesday it made an underlying pretax profit of 25.7 million pounds in the six months to February 28.
That was in line with analysts' consensus forecasts and up from 23.1 million pounds in the same period of the 2011-12 year.
The firm, which targets young women looking to emulate the designer looks of celebrities like Nicole Scherzinger and Cara Delevingne, said group revenue increased 33 percent to 359.7 million pounds.
However, retail gross margin was 60 basis points lower, partly reflecting lower prices and a higher proportion of UK sales, which attract VAT sales tax.
The firm said UK retail sales rose 26 percent to 137.6 million pounds, while overseas sales increased 39 percent to 214.7 million pounds - accounting for 61 percent of the total.
"Our international roll out continues and our 1 billion pounds sales ambition for the group is firmly in our sights," said Chief Executive Nick Robertson, noting that progress on establishing dedicated websites for both Russia and China remained on track.
(Reporting by James Davey, Editing by Brenda Goh and Sarah Young)
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