ref="http://www.cityam.com/company/asos">ASOS, the UK’s largest online-only fashion retailer, outlined plans yesterday to spend around £12m in the next two years on its expansion into China as it reported a leap in first half profits.
Shares edged higher after it posted an 11 per cent rise in profits to £25.7m in the six months to 28 February and revealed it will launch a Chinese language website in October.
Its Chinese arm will have its own local distribution centre and payment methods, unlike its other overseas operations which sell products shipped from a warehouse in Barnsley.
Setting up the business will cost around £4m-£6m during each of the years to 31 August 2014 and 31 August 2015, Asos said.
The launch of its Russian language website has also been brought forward from October to this month, Asos said.
Group sales increased by 33 per cent to £359.7m compared with the same period last year.
UK retail sales were up 26 per cent to £137.5m while overseas sales, which now account for 61 per cent of turnover, rose 39 per cent.
Asos also announced a new long term incentive plan for executives and senior management including founder Nick Robertson, who owns a 9.4 per cent stake.
Under the three-year plan, executives can collect a payout in shares if they hit the target of £1bn of sales for the 2014-15 year.
There is also a so-called stretch target of £1.3bn – which if achieved could see executives pocket around £39m in shares at today’s prices.