ASOS shares fell by 11 per cent on Wednesday morning despite seeing a healthy boost to half-year profits.

The online fashion retailer saw sales grow by 27 per cent in the six months ending February, with international sales growing by 31 per cent and UK sales up by 22 per cent.

The UK based company, notable for its appeal to young online shoppers, made a total of £1.15bn in the six month period, with UK retail sales accounting for £414m and sales from the rest of the world raking in £716.8m.

Download the new Independent Premium app

Sharing the full story, not just the headlines

Analyst Nicholas Hyett said the unusual sight of company shares falling after delivering strong growth was down to the firm’s inability to keep costs down.

“That the rapid growth isn’t delivering any meaningful margin benefits only adds to the frustration,” he said.

Mr Hyett added: “The ramp up of activity in Europe and creation of US infrastructure were always going to be capital intensive and, once complete, investment demands should fall back. Once that’s out of the way increased sales volumes should see margins heading in the right direction – we hope.”

ASOS chief executive Nick Beighton has committed to investing more than £250m in distribution and infrastructure to meet growing demand.

“These results show strong trading at the same time as we are making substantial investment in our future,” he said.

“Our customer engagement is going from strength to strength and we’ve achieved more than a billion site visits for the first time”.

Comments

Share your thoughts and debate the big issues

Learn more
Please be respectful when making a comment and adhere to our Community Guidelines.
  • You may not agree with our views, or other users’, but please respond to them respectfully
  • Swearing, personal abuse, racism, sexism, homophobia and other discriminatory or inciteful language is not acceptable
  • Do not impersonate other users or reveal private information about third parties
  • We reserve the right to delete inappropriate posts and ban offending users without notification

You can find our Community Guidelines in full here.

Create a commenting name to join the debate

Please try again, the name must be unique Only letters and numbers accepted
Loading comments...
Loading comments...
Please be respectful when making a comment and adhere to our Community Guidelines.
  • You may not agree with our views, or other users’, but please respond to them respectfully
  • Swearing, personal abuse, racism, sexism, homophobia and other discriminatory or inciteful language is not acceptable
  • Do not impersonate other users or reveal private information about third parties
  • We reserve the right to delete inappropriate posts and ban offending users without notification

You can find our Community Guidelines in full here.

Loading comments...
Loading comments...