Asos has revealed its recent financial performance, showing significant financial challenges.
- The group’s revenue decreased by 18%, reaching £2.9bn for the year ending 1 September 2024.
- Operating losses increased by 34%, escalating to £331.9m during the same period.
- Despite losses, Asos improved its free cash flow by £250.7m year on year, ending at £37.7m.
- Chief executive Ramos Calamonte remains optimistic, citing improvements in stock performance.
Asos has reported a notable decline in its financial metrics, highlighted by an 18% drop in group revenue to £2.9bn for the year ending 1 September 2024. This reduction in revenue was accompanied by a rise in operating losses, which increased by 34% to reach £331.9m, reflecting a challenging fiscal environment.
The company’s financial difficulties are further evidenced by a pre-tax loss of £379.3m, compared to the previous year’s £296.7m loss. Despite these setbacks, Asos managed to improve its free cash flow by £250.7m compared to the previous year, culminating in a free cash flow of £37.7m.
Through disciplined stock management and a £100m write-down, Asos successfully reduced its stock levels by approximately 50% since the full year of 2022. This strategic move is aimed at transitioning to a new commercial model by the end of the fiscal year 2024.
Chief executive José Antonio Ramos Calamonte remains optimistic about Asos’ future, pointing to strengthened balance sheets through ventures like the Topshop Topman joint initiative and refinancing efforts. He commented, “Our product is now in the strongest position it has been in years, with the right level of newness to excite customers, and we have fundamentally improved our profitability through a relentless focus on operational efficiency.”
Calamonte is encouraged by the early signs of success, noting that new product sales have increased by 24% year on year over the past three months. He expressed enthusiasm for the company’s progress, stating, “There is much work to do, but we have already seen our efforts rewarded with new product sales increasing 24% year on year over the last three months. I am energised by the progress we have made so far and excited for the next phase of our journey.”
Asos faces significant financial challenges, but its strategic initiatives and leadership optimism indicate potential for recovery.
