ASOS battles slump as first-half sales plunge 18%

There’s still no sign of a turnaround at ASOS as firm grapples with challenging times, reporting an 18% drop in sales for the first half...

ASOS battles slump as first-half sales plunge 18%

Struggling British online fashion retailer ASOS (LSE: ASC), saw a steep 18% decline in sales during its first half, the company announced on Tuesday. Despite this setback, the embattled firm maintained its full-year guidance, projecting sales to decline within the 5-15% range as its turnaround plan unfolds.

The pandemic-stricken company, which has grappled with stagnant growth, has designated 2024 as a transitional year. ASOS is focused on accelerating processes, introducing new collections, and offloading excess inventory accumulated during the health crisis.

For the 26 weeks ending March 3, ASOS's sales fell by 18%, broadly aligning with its expectations. The company reiterated its guidance for an improving sales decline over the 12-month period.

ASOS also reaffirmed its forecast for positive adjusted core earnings (EBITDA), positive cash generation, and a return to pre-COVID inventory levels.

CEO José Antonio Ramos Calamonte expressed optimism, citing the promising performance of ASOS's new collections and progress in selling off excess pandemic inventory as well as improving core profitability.

ASOS shares have plummeted over 50% in the past year, reflecting the company's ongoing struggles. After a brief resurgence in summer 2023, the stock has once again dipped below 400p, continuing its relentless downtrend since early 2021.

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