LONDON (Alliance News) - ASOS PLC escaped unharmed from the warmer-than-normal winter weather, the online retailer said on Thursday, as it posted strong sales growth for the Christmas period, bucking the trend reported by some its peers which saw sales fall in what was the warmest December in the UK on record.
On Thursday, ASOS said total group revenue in the four months ended December 31 grew 23% to GBP459.7 million from GBP374.7 million in the same period the year before, as total retail sales rose 22% to GBP446.9 million from GBP365.2 million.
ASOS said it made record sales over the so-called cyber weekend in late November, while average order frequency, basket value, number of orders, and active customers grew over the period.
UK retail sales expanded 25% and international retail sales increased 20% at actual currencies, boosted by price investments, a strong full-price sales mix, and ASOS's 'zonal pricing'.
ASOS's zonal pricing strategy offers more competitive local pricing in overseas territories including Australia, France, Germany, Spain, Italy and the US, which has appeared to boost international sales after they were getting hit by the strength of the pound. However, this has also harmed retail gross margin, which declined by 40 basis points in the period.
The strong sales growth seems to defy the trends other clothing retailers have recently warned about in their post-Christmas trading updates.
Last week, Next PLC and Marks & Spencer Group PLC released worse-than-expected Christmas trading results, saying that revenue was hit by unusually warm weather, leading to poor sales and a lack of stock availability. Sports Direct International PLC also issued a statement warning that its full-year earnings would be hit for the same reason.
Debenhams PLC, however, on Tuesday released better-than-expected sales over the Christmas period, and like ASOS, seemed unharmed by the warmer winter weather. JD Sports Fashion PLC, the sports and outdoor goods retailer, also escaped in good shape, upgrading its profit expectations on Thursday after a good Christmas.
With ASOS's specific segment of the market, online fashion retailer Boohoo.com, which skews to a younger audience than ASOS, also managed to successfully navigate through any weather concerns. Boohoo said the good start to its financial year, with sales up 45% in the four months to the end of December, points to its revenue growth for the full year outpacing previous guidance.
"We have traded well through peak and are continuing to invest in the future growth of the business. We are on track with our plans for the year as a whole," Chief Executive Nick Beighton said. Beighton was promoted to the CEO role in September, having previously been chief operating officer, taking over from founder Nick Robertson.
Shares in ASOS were trading down 2.4% at 3,105.00 pence on Thursday afternoon.
By Karolina Kaminska; karolinakaminska@alliancenews.com @KarolinaAllNews
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