SHARE OF THE WEEK: Investors are hoping for signs of improvement at Asos after a year of woes
Investors are hoping for signs of improvement at Asos after a year of woes.
The online fast fashion company has struggled under the weight of higher input costs as customers cut back on spending.
Chief executive Jose Antonio Ramos Calamonte, who took the top job in June 2022, has insisted Asos can “achieve much more”.
It flipped to an annual loss of £32m last year after margins were hammered by supply chain inefficiencies amid ‘macroeconomic challenges’.
As post-Covid shoppers returned to High Street stores, Asos was hit with customers returning more packs or opting not to order online.
The retailer, favored by Gen Z shoppers, will publish its first-half results on Wednesday.
Hargreaves Lansdown analyst Susannah Streeter said shareholders will be watching how measures such as reducing excess inventories, phasing out storage facilities and job cuts play out.
She said: “Bad weather had a dent in High Street sales in March, but online sales were more resilient, which could bode well for performance, with shoppers generally looking to spend a little more than expected in the autumn.’
Analysts expect a year-on-year loss of around £16 million.
But investors will hope it will provide signs that Asos is turning a corner and can return to profit in full year results.
Analysts from AJ Bell have forecast an annual profit of £60m compared to a loss of £32m last year.