Profits at Asos have soared 28 per cent as the online fashion retailer delivered another strong set of results, in stark contrast to many of its high street competitors.

While the outlook for traditional stores has become increasingly bleak in 2018 as shoppers switch online, sales at Asos jumped by £500m to £2.4bn for the year to 31 August.

Asos shares jumped 15 per cent after the announcement on Wednesday morning, taking its valuation to £4.8bn.

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London-based Asos reiterated its plans to invest in continued expansion and chief executive Nick Beighton said the company's potential was “huge”.

Asos, which specialises in fast fashion for young people, grew sales by more than a fifth in the UK and internationally, and has delivered 20 per cent increases for three years in a row.

Profits came in at £102m, just beating expectations, despite the heavy cost of upgrading its warehouses to keep up with demand.

“The potential for our business is huge and we remain focused on building Asos into the world's number one destination for fashion-loving twentysomethings,” Mr Beighton said.

Some analysts had questioned whether the company's rapid expansion may be slowing after it reported lower than expected sales in July.

And despite today’s gains, the company’s share price, which is largely based on expected future growth, is still down around 12 per cent this year at £57.49.

But Asos remains the UK’s leading online-only clothes retailer and predicted sales would jump by another 20 to 25 per cent this financial year.

Sofie Willmott, senior retail analyst at GlobalData, said Asos was far outpacing the online market as a whole and continuing to keep ahead of younger rivals such as Boohoo and PrettyLittleThing.

“Unlike some of its competitors that have been blaming the prolonged warm weather for a disappointing performance over the summer, Asos’s sales accelerated in the last two months of FY2017/18 demonstrating the appeal of its proposition and the loyalty that Asos Premier drives,” Ms Willmott said.

The strong results again highlight the diverging fortunes of successful online fashion retailers and their brick-and-mortar rivals.

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Debenhams, Marks & Spencer and House of Fraser have all shut stores and shed staff this year as they try to cut the cost of maintaining a presence on the high street.

“Asos are cutting a dash in a fashion sector that has been looking a little tired recently,” said Ed Monk, associate director at Fidelity Personal Investing.

“Asos is expanding internationally, growing its market share in overseas territories and should maintain an advantage in its online proposition against rivals that will have to invest heavily to catch up.”

George Salmon, equity analyst at Hargreaves Lansdown said the results should put “niggling worries” to bed. “Asos has delivered strong growth despite a weak UK consumer environment,” he said.

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