Shares in online retailer Asos have leaped almost 20 per cent this morning, after the beleaguered online retailer reported a 27 per cent rise in sales.
Although results posted today showed pre-tax profits fell 14 per cent to £46.9m in the year to the end of August, from £54.7m during the same period last year, investors were buoyed by the fact the fall is not quite as bad as analysts expected - particularly after a string of profit warnings, the latest of which came in September.
Investors were presumably also encouraged by the news Nick Beighton, Asos' embattled finance director, will move across to become its chief operating officer.
Summarising the challenges for the retailer, chief executive Nick Robertson said:
We are in a period of major investment that comes at a short term cost, but the medium-term benefits will be significant. As a result, we've had to manage a number of factors including disruption from significant investment in our warehousing, the launch of our new business in China, the strengthening of the pound and the fire at our Barnsley warehouse in June, all of which combined to reduce profits by 14% to £46.9m.
Despite its woes, Robertson said the retailer's target of reaching £2.5bn in sales remained in place. Asos neared the billion pound mark with sales of £955.3m for the year, over half of which came from international sales, up 22 per cent, while UK sales grew 35 per cent.
Profits for next year are expected to come in at a similar figure “representing a continuation of our medium-term build phase” the firm said, with the intention for “significant investments in international pricing and proposition, as well as continuing to invest in our logistics infrastructure and technology platforms,” in the year ahead.