Asos profits quadruple amid online shopping surge during coronavirus lockdown

Fashion group has added three million customers in the past year

Asos has reported a quadrupling in its full-year profits following a surge in online shopping during the coronavirus pandemic.

On Wednesday, the British online fashion retailer announced that it made a pre-tax profit of £142.1m in the year to 31 August, which is up from £33.1m in the same period last year.

Asos added that sales rose by 19 per cent to £3.3bn as it served more than 23 million customers, an increase of 3.1 million.

The retailer also said the buying habits of its customers had changed during the pandemic, with people buying less occasion-wear and more leisurewear, which was also less likely to be returned.

Nick Beighton, chief executive at Asos, said the group had made a “solid” start to the new financial year and that it was well set up for the peak Christmas trading period.

However, he added that the retailer remained cautious regarding consumer demand due to the ongoing disruption to the economic prospects and lifestyles of its customers.

“After a record first half which saw us make progress in addressing the performance issues of the previous financial year, the second half will always be defined by our response to Covid-19,” Mr Beighton said.

“I am proud of the way Asos met this challenge head on, putting our duty to act as a responsible business at the heart of our approach and working to balance our performance in that context. As well as protecting staff, suppliers and customers, we’ve driven efficiency and have emerged a stronger, more resilient and agile business whilst delivering strong profit and cash generation.”

He added: “Whilst life for our 20-something customers is unlikely to return to normal for quite some time, Asos will continue to engage, respond and adapt as one of the few truly global leaders in online fashion retail.”

Shares in Asos have doubled over the past year, leaving it with a market capitalisation of £5.4bn at the end of trading yesterday – more than double that of Marks & Spencer, the UK’s largest clothing retailer by sales.  

Asos is one of the few retailers that have benefitted from lockdown.

In July, H&M announced plans to close 170 of its stores as a result of declining sales amid the Covid-19 crisis.

The Swedish fashion retailer said in its second-quarter report to investors that it increased its previous closure plans by around 40 stores after feeling the impact of the virus.

Several other retail businesses have been forced to call in administrators in recent months, including Debenhams, Cath Kidston, Victoria’s Secret and Zara.