TIDMASC
RNS Number : 9200Y
ASOS PLC
10 May 2023
10 May 2023
ASOS plc ("the Company")
Global Online Fashion Destination
Interim Results for the six months to 28 February 2023
Executing on Driving Change agenda, creating strong foundations
for a return to profitability and cash generation in H2 FY23 and
beyond
Summary financial results
Six Six CCY(2) CCY change
GBPm(1) months months Change change excluding
to 28 to 28 Russia(2,3,4)
February February
2023 2022
-------------------------- -------------------- -------------------- -------------------- ------------------ -------------------------
Headline
measures
Group
revenue(5) 1,840.6 2,004.1 (8%) (10%) (7%)
Adjusted gross
margin
(6) 42.9% 43.1% (20bps)
Adjusted
EBIT(6) (69.4) 26.2
Adjusted EBIT
margin
(6) (3.8%) 1.3% (510bps)
Adjusted
(loss)/profit
before tax(6) (87.4) 14.8
Net debt(6) (431.7) (62.6)
Free cash
outflow(6) (262.7) (256.5)
Statutory
measures
Gross margin 36.1% 43.1% (700bps)
Operating loss (272.5) (4.4)
Reported loss
before
tax (290.9) (15.8)
-------------------------- -------------------- -------------------- -------------------- ------------------ -------------------------
Strategic U pdate
-- Despite the ongoing challenges in the operating environment,
ASOS is on track to deliver full year targets of:
o Over GBP300m of Driving Change agenda benefits, with over
GBP100m delivered in H1. Actions already taken will drive more than
95% of c.GBP200m profitability benefits expected in H2 FY23;
o Inventory reduction of c.20% year-on-year ('YoY'), with 9%
reduction vs FY22 achieved in H1, slightly ahead of plan;
o Adjusted gross margin improvement of c.100bps, with recent
run-rate up more than 300bps YoY;
o Profitability and cash generation in H2 FY23 and beyond, with
GBP40-60m adjusted earnings before interest and tax ('EBIT') and
over GBP150m free cash inflow(7) in H2 FY23;
-- Robust and flexible balance sheet with an amendment and
extension of existing GBP350m revolving credit facility ('RCF')
through to November 2024. The facility steps down over the term,
reducing to GBP220m by August 2024. The Company had cash and
undrawn facilities over GBP400m at 28 February 2023.
-- Refreshed management team, with newly formed Management Committee now largely complete.
-- ASOS remains focused on executing the final stages of its
Driving Change agenda, creating strong foundations for its next
phase of growth.
H1 Results Summary
-- Revenue(8) declined by 7% ( down 8% on a reported basis) in
H1 FY23 and 15% in P2 FY23, reflecting both deliberate actions on
capital allocation to improve profitability and a challenging
trading backdrop. The actions taken account for broadly 50% of the
revenue decline since December but are driving improving order
economics.
-- Sales momentum in January and February reflected: (1) planned
profitability actions including reduced markdown, discipline on
marketing spend and country-specific proposition changes; (2)
reduced width in the assortment as the Company took decisive action
to right-size stock; and (3) a challenging online retail
environment as online penetration declined YoY - although remaining
notably higher than pre-pandemic.
-- UK sales were down 10% YoY, Europe flat, US down 7% and Rest
of World down 12%. Variation in performance reflects regional
differences in the economic backdrop as well as country-specific
profit actions taken by the Company in-line with its focus on
profitability over top-line growth. The regional trends in sales
growth were reflected in active customer numbers in the period.
However, ASOS has continued to grow its share of its core UK online
retail market among its main 16-35 demographic and has increased
its share of its customers' wallets(9) .
-- Adjusted gross margin(10) was broadly flat, both YoY and from
P1 FY23, at 42.9%. It showed encouraging progress over the period,
with February adjusted gross margin up more than 300bps YoY and
sustained through March and April, supported by lower freight and
duty rates.
-- Stock has been reduced by 9% from the level reported at FY22,
slightly ahead of the 5% H1 FY23 reduction planned at the time of
the P1 FY23 update.
-- H1 FY23 adjusted EBIT loss was GBP69.4m and adjusted loss
before tax was GBP87.4m. Actions taken under the Driving Change
agenda had a positive profit impact of more than GBP100m, partially
offsetting anticipated headwinds of c.GBP180m (predominantly from
inflation and normalisation of return rates).
-- The reported loss before tax of GBP290.9m includes GBP203.5m
of adjusting items, primarily relating to the execution of the
Driving Change agenda. These include GBP128.2m relating to the
previously announced stock write-off and GBP49.4m of non-cash
property impairments and closure costs relating to the reduction of
the Company's head office and logistics footprint. The cash outflow
relating to adjusting items in the period was GBP23.0m. Further
detail on the adjusting items is included in note 3 on pages
23-26.
-- Free cash outflow(11) for the half was GBP262.7m mainly
driven by the reported loss in the period, H1-weighted historical
committed capex investment of GBP115.0m and the phasing of stock
receipts and payments, with the cash benefit associated with the
lower H1 intake expected in H2 FY23.
-- ASOS ended H1 FY23 with cash and undrawn facilities totalling
GBP408.6m at what is typically the seasonal trough in its net
working capital cycle.
Current Trading & Outlook
-- Sales momentum in P2 FY23 (-15% CCY ex-Russia) has broadly
continued into March and April with approximately half of the sales
decline driven by planned Driving Change initiatives. However, with
adjusted gross margin run rate up more than 300bps YoY, adjusted
gross profit was broadly flat YoY over the same period, reflective
of the prioritisation of profitability over growth.
-- ASOS will retain its focus on profitable sales in H2 FY23 and
its commitment to exit the year with a cleaner inventory position.
If there is no improvement to the external trading environment,
expectations for H2 FY23 are:
o Sales (CCY ex-Russia) decline of low double-digit YoY;
o Adjusted gross margin up c.200bps YoY;
o Inventory reduction of c.20% YoY;
o Adjusted EBIT of GBP40-60m, adjusted EBIT margin c.3%;
o Free cash inflow of over GBP150m, excluding all incremental
refinancing costs (interest, arrangement and advisor fees). This
equates to over GBP125m free cash inflow including refinancing
costs;
o Capex of GBP60-85m (in-line with FY23 guidance of
GBP175-200m);
o Interest expense of c.GBP30m, including amortisation of
arrangement fees and related costs;
o EBIT impact of adjusting items in the range of GBP25m-GBP30m
in H2 FY23, of which GBP15m is non-cash (mostly relating to the
Driving Change agenda).
-- For FY23, free cash outflow (prior to incremental refinancing
costs) will be around GBP100m (i.e. around the bottom end of the
GBP0 to GBP100m outflow guidance provided at FY22).
Jos é Antonio Ramos Calamonte, Chief Executive Officer said:
"Our focus is on improving our core profitability, prioritising
order economics over top-line growth and I am pleased with the
strategic and rapid operational progress the business has made in
the first half of the financial year, against some very challenging
trading conditions. Thanks to the hard work and commitment of our
teams, we have accelerated the roll-out of our new commercial
model, delivered more than GBP100m of profit optimisation and cost
saving initiatives, extended our financing facility and continued
to build out our top team while remaining committed to our Fashion
with Integrity agenda. Taken together, these measures will create a
more sustainably profitable and cash generative business as we
reinforce our position as a leading destination for our
fashion-loving customers.
"While some of these changes have impacted short-term sales
growth, there are many causes for optimism as we progress through
the second half of the year. We are improving our gross margin run
rate in the face of significant headwinds, are starting to see the
benefits of a repositioned stock profile, and are taking action to
reduce the proportion of our sales which are not profitable.
Initiatives are in place to drive a further c.GBP200m of benefit in
the second half and I am very confident of our return to
sustainable profit and cash generation in the second half of the
year and beyond."
The amendment and extension to Revolving Credit Facility agreed
with the Company's banking syndicate constitutes inside
information. This announcement therefore includes inside
information.
The person responsible for arranging the release of this
announcement on behalf of ASOS is Emma Whyte, General Counsel and
Company Secretary.
Notes
(1) All numbers subject to rounding throughout this
document.
(2) Constant currency is calculated to take account of hedged
rate movements on hedged sales and spot rate movements on unhedged
sales.
(3) Calculation of metrics, or movements in metrics, on an
ex-Russia basis involves the removal of Russia from H1 FY22
performance. This adjustment allows YoY comparisons to be made on a
like-for-like basis following the decision to suspend trade in
Russia on 2 March 2022.
(4) Excludes one-off jobber income in relation to the stock
write-off program of GBP2.1m in H1 FY23. Further detail on the
adjusting items can be found in n ote 3 on pages 23-26.
(5) Includes retail sales, wholesale and income from other
services.
(6) Definitions of the adjusted performance measures used above
and throughout this document can be found on pages 45-46.
(7) Free cashflow guidance is excluding all incremental
refinancing costs (interest, arrangement and advisor fees).
(8) All sales numbers quoted in this document are at constant
currency and exclude Russia from the H1 FY22 comparative base
period unless otherwise stated.
(9) Share of UK online retail market based on Kantar | Total
Market | Total Clothing, Footwear and Accessories | 16-35 year olds
| Market Shares | 24 w/e 5th March 2023 vs LY, share of customers'
wallets based on Kantar | ASOS Shoppers | Online | Spend % I 24 w/e
5th March 2023 vs LY.
(10) Excluding the gross profit impact of the stock write-off of
GBP119.7m announced at FY22 and non-underlying sales tax of
GBP4.9m. Reported gross margin of 36.1% (down 700bps YoY). Further
detail on adjusting items can be found in note 3 on pages
23-26.
1 (1) Definition of free cash outflow can be found on pages
45-46.
Investor and analyst meeting:
The Company will be hosting an in-person presentation for
analysts and investors at 9.00am at ASOS HQ, Greater London House,
NW1 7FB. For those unable to attend in person a live webcast will
be available, and a recording of the presentation will be uploaded
to the ASOS investor relations website afterwards.
To access live please dial +44 203 901 7895 and use Meeting ID:
882 4156 1706 and passcode: 747285 . A live stream of the event
will be available here .
A recording of this webcast will be available on the ASOS Plc
investor centre website after the event:
https://www.asosplc.com/investor-relations/
For further information:
ASOS Plc Tel: 020 7756 1000
José Antonio Ramos Calamonte, Chief Executive
Officer
Katy Mecklenburgh / Sean Glithero, Interim
Chief Financial Officer
Michelle Wilson, Senior Director of Strategy
and Corporate Development
Holly Cassell, Head of Investor Relations
Website: www.asosplc.com/investors
Headland Consultancy Tel: 020 3805 4822
Susanna Voyle / Stephen Malthouse / R ob Walker
JPMorgan Cazenove Tel: 020 7742 4000
Bill Hutchings / Will Vanderspar
Numis Securities Tel: 020 7260 1000
Alex Ham / Jonathan Wilcox / Tom Jacob
Berenberg Tel: 020 3207 7800
Matthew Armitt / Richard Bootle / Marie Moy
Background note
ASOS is a destination for fashion-loving 20-somethings around
the world, with a purpose to give its customers the confidence to
be whoever they want to be. Through its app and mobile/desktop web
experience, available in nine languages and in over 200 markets,
ASOS customers can shop a curated edit of over 60,000 products,
sourced from nearly 900 global and local third-party brands
alongside a mix of fashion-led own-brand labels - ASOS Design, ASOS
Edition, ASOS 4505, Collusion, Reclaimed Vintage, Topshop, Topman,
Miss Selfridge and HIIT. ASOS aims to give all of its customers a
truly frictionless experience, with an ever-greater number of
different payment methods and hundreds of local deliveries and
return options, including Next-Day Delivery and Same-Day Delivery,
dispatched from state-of-the-art fulfilment centres in the UK, US
and Germany.
Forward looking statements:
This announcement may include statements that are, or may be
deemed to be, "forward-looking statements" (including words such as
"believe", "expect", "estimate", "intend", "anticipate" and words
of similar meaning). By their nature, forward-looking statements
involve risk and uncertainty since they relate to future events and
circumstances, and actual results may, and often do, differ
materially from any forward-looking statements. Any forward-looking
statements in this announcement reflect management's view with
respect to future events as at the date of this announcement. Save
as required by applicable law, the Company undertakes no obligation
to publicly revise any forward-looking statements in this
announcement, whether following any change in its expectations or
to reflect events or circumstances after the date of this
announcement.
ASOS plc ("the Company")
Global Online Fashion Destination
Interim Results for the six months to 28 February 2023
CEO Review
In my inaugural ASOS results announcement last October, I set
out a frank assessment of the Company's many strengths, but also
some areas where our performance was lacking. This is an incredible
business with a compelling brand, customer offer and fashion
credibility. The opportunity is in improving the way we operate,
including delivering on our Fashion with Integrity programme on
which we have published our second annual progress report. This
diagnosis resulted in our Driving Change agenda, an action plan to
accelerate the changes needed to transform ASOS into a sustainably
profitable and cash generative business, built on four key
principles: simplicity, speed to market, operational excellence;
and flexibility and resilience. The economic environment we are
operating in is extremely challenging, but I am delighted with the
commitment and dedication of the ASOS team to deliver on our plan.
The Driving Change initiatives implemented to date have generated
more than GBP100m of benefit in H1 FY23 and created a strong
foundation for ASOS' return to profitability in H2 FY23 and beyond.
Indeed, more than 95% of the c.GBP200m of benefits expected in H2
FY23 are based on initiatives already in place.
Revenue declined 7%(1) YoY in H1 FY23 to GBP1,840.6m (down 8% on
a reported basis(2) ). This performance reflects both a challenging
trading environment and the impact of profitability actions taken
under the Driving Change agenda, largely since December. We remain
convinced these measures are the right ones to achieve our ambition
to become a sustainably profitable, cash generative business in the
longer term and we have already seen order economics improve as a
result. We are making these changes at the same time as our
customers are feeling the squeeze financially and in the short-term
are returning to physical stores post-pandemic. However, on a
three-year view online penetration has increased substantially, and
we remain confident in the structural drivers underpinning
continued growth in the online channel in the medium term. In the
meantime, we have grown our share of the 16 to 35 online retail
market in the UK, maintaining our market leading position as our
proposition continues to resonate with our core consumer. The
strength of our offer is perhaps best reflected by the performance
of the Topshop brand, which has delivered retail sales growth of
12% (3) YoY and a higher margin than the Company average.
A detailed update of our progress against our Driving Change
agenda is covered in the following pages.
i. Renewed commercial model
The new commercial model comprises a comprehensive change in
ASOS' approach to buying and merchandising, improved stock
management discipline and reduced complexity in our logistics
network to ensure that its fashion-loving 20-something core
customer base is exposed to cutting edge fashion curated in ASOS'
own unique way. The benefits of this are twofold: a more engaging
customer experience with exposure to more inspirational, relevant
product; and a higher proportion of more profitable full-price
sales.
Current product lead times mean there is a lag between
operational change and visible results. However, over the period
ASOS has taken decisive action aimed at simplifying the product
journey, including increasing flexibility in its buying processes,
re-setting its stock profile and closing ancillary warehouse space.
Encouragingly, there was positive progression in underlying gross
margin through the half. While the sales outlook for the year is
more challenging than initially anticipated, the current adjusted
gross margin run rate is up more than 300bps YoY and provides
headroom for ASOS to take action if necessary to ensure it exits
the year with a significantly improved stock profile, thus laying
the foundations for FY24.
(1) Total revenue CCY excluding Russia declined by 7% (down 10%
CCY including Russia).
(2) Total reported revenue including Russia declined by 8% (down
5% on a reported basis excluding Russia).
(3) Topshop brand sales on the ASOS.com platform growth of 12%
(excluding Russia) and 10% (including Russia).
Stock profile
To facilitate the introduction of the new model, ASOS is taking
action to right-size its stock profile in three phases:
1. Stock write-off: At the FY22 results announcement, a
non-underlying stock write-off of up to GBP130m was announced,
taking decisive action to clear excess stock and deliver more
efficient use of the Company's warehouse network. C.90% of the
stock identified for write-off has now been extracted from the ASOS
core network, enabling the implementation of supply chain
efficiency initiatives under the Company's programme of cost saving
measures described under pillar ii) below.
2. Spring / Summer intake: With the new commercial model
initiated part-way through the Spring/Summer '23 buying cycle, the
opportunity to reduce intake was predominantly via a reduction in
the number of options. This has had a negative impact on current
trading which is expected to continue through the remainder of the
Spring / Summer season (i.e. the remainder of FY23) but will drive
the planned c.20% reduction in stock by the end of the financial
year.
3. Autumn / Winter intake: Looking ahead to Autumn/Winter '23,
the principles underpinning the new model will be manifested in
full. The newly formed central merchandise planning team is driving
a more dynamic approach to stock management, facilitating a
reduction in intake volumes while restoring width to the
assortment. This approach is intended to increase stock turnover to
pre-pandemic levels by the end of FY24.
Flexibility in the assortment
In the longer term, improved relevance and hence full-price
sell-through are achieved by increasing flexibility in the ASOS
product assortment. On its own-brand offer, the Company is
currently running a 'Test and React' pilot using UK suppliers
across a small number of product lines. The purpose of this pilot
is to stress test ASOS' ability to reduce product lead times from
concept to site to c.2 weeks in certain circumstances. For partner
branded product, the Partner Fulfils model will play a strategic
role by increasing the range and depth of products for sale without
an associated stock risk for the Company. This will be particularly
valuable in product categories with longer lead times such as
sportswear. The Company has continued to build out the functional
capability of the Partner Fulfils platform to enable the addition
of more brands and services in H2 FY23 and beyond. Additional
technology capabilities have also increased automation in the
onboarding process, making for a more streamlined experience for
ASOS' partners. 24 Partner Fulfils brands are currently live in the
UK and Europe.
ii. Stronger order economics and a lighter cost profile
In parallel with changes to the commercial model, the Company
also set out plans to optimise its cost base, improving order
economics and maximising operating model efficiency to ensure a
sustainable level of profitability and cash generation is achieved
in all markets. At P1 FY23, a comprehensive package of profit
optimisation and cost mitigation initiatives was announced under
the Driving Change agenda with an expected full year benefit of
more than GBP300m. Implementation of these initiatives is in line
with plan and the Company delivered more than GBP100m in H1 FY23,
partially mitigating the H1-weighted headwinds resulting from
inflation, returns normalisation and cost deleverage to result in a
GBP69.4m adjusted EBIT loss. These headwinds drove notable
adversity in 'other costs' (+260bps YoY as a percentage of sales)
and warehouse costs (+210bps YoY as a percentage of sales, which
also reflects inefficiencies resulting from the high stock position
at the start of the year).
The Company remains on track to deliver Driving Change agenda
benefits in excess of GBP300m in FY23. Of the c.GBP200m of benefits
guided for H2 FY23, more than 95% result from initiatives already
implemented in the first half of the year. Against a backdrop of
abating headwinds, this underpins expectations of a return to
profitability and cash generation in H2 FY23.
As expected at the P1 FY23 trading update, c. 60% of the more
than GBP100m of benefits delivered in H1 FY23 related to profit
optimisation initiatives while c.40% reflected cost mitigation.
Profit optimisation
As with stock profile, ASOS has taken action in three phases to
improve customer profitability:
1. Brand level: The first phase of action, centred around
unprofitable brands, was undertaken in October 2022. ASOS
constantly reviews its brand portfolio to offer consumers the most
exciting and inspiring curated edit of product. From October, a
comprehensive review of brand profitability was undertaken. Brands
can become unprofitable for a number of reasons including
heightened promotional activity or returns, which is often
correlated with, but not entirely dependent on product relevance.
Where unprofitable partners are categorised as 'strategic' brands,
remedial action was taken including reduced discounting with a view
to improving their contribution. Those deemed not to be strategic
have been removed from the platform in some or all geographies
depending on local performance. As flagged at P1 FY23 results, ASOS
identified 35 unprofitable brands for removal, and has ceased
buying from these brands.
2. Country level: From November 2022, ASOS undertook a
comprehensive review of country profitability, segmenting countries
according to both their profit contribution and, in cases where
profitability was not being maximised, the reasons behind this. A
differentiated approach has been taken to remedy the issues facing
countries in each segment. For example, free standard delivery was
removed in five non-core European countries, delivery charges and
thresholds were introduced or increased in a number of RoW markets
and delivery prices were adjusted across the US. We have seen
significant improvements in the underlying profit contribution from
all our key territories during the period.
3. Customer level: The third, more targeted phase of action is
at the customer level. ASOS has built a base of c.25m highly
engaged, young, fashion-loving customers. However, there are a
small number of customers that have a disproportionately negative
impact on ASOS profitability (over GBP100m). This group, which in
FY22 accounted for 6% of active customers, generated a loss of
c.GBP6 per order due to a heavy reliance on discounted product and
high return rate, and ordered significantly more frequently than
average. This behaviour may be temporary, part of the lifetime
journey of a profitable customer or simply bad business for ASOS.
ASOS is now undertaking more refined action, using a more
personalised approach to incentivise positive behaviours.
The decisive action taken to improve profitability at speed
using brand and country level measures has, as expected, adversely
impacted sales and customer numbers in some cases. Active customers
declined by 0.6m YoY to 24.9m(1) as ASOS churned some of the
increase seen during the pandemic and a more disciplined approach
to marketing investment saw new customer acquisition fall in a
weaker consumer environment. The Company also saw a 7% YoY decline
in Premier customers as subscription prices increased and minimum
order values were introduced, or increased, in many territories.
However, the average customer value (2) of both active and Premier
customers has increased over the period, and ASOS' share of its UK
customers' wallet has also increased by 50bps YoY (3) .
Cost mitigation
ASOS' operational excellence initiatives have impacted cost
lines throughout the P&L. The most significant grouping of cost
savings relate to supply chain (c.GBP27m), including the cessation
of UK split orders being partially shipped from the Lichfield
facility which, (in contrast to Barnsley) is not fully automated.
Other significant categories include savings in overheads
(c.GBP12m) and marketing (c.GBP6m). The Company reduced its
investment in customer acquisition as it prioritised optimisation
of existing customer profitability at a time of low growth, with
marketing spend declining 8% YoY (flat YoY at 6% of sales). Within
this, spend was curtailed in periods and geographies where consumer
demand was weak and redeployed where it was more likely to generate
value. These decisions are reflected in customer numbers as well as
contributing to the variation in revenue by segment.
iii. Robust, flexible balance sheet
ASOS ended H1 FY23 with cash and undrawn facilities totalling
GBP408.6m at what is typically the seasonal trough in its net
working capital cycle. In May 2023 the Company agreed an amendment
and extension of its RCF to November 2024. The amended facility
replaces the current GBP350m existing RCF and steps down over the
term to GBP220m by August 2024. The RCF extension secures the
Company's funding beyond FY24, supporting the business as it
continues to execute on its Driving Change agenda and return to
profitability and cash generation. The financing is subject to
liquidity, leverage and interest cover covenants.
(1) Active customers declined by 0.6m YoY to 24.9m excluding
Russian active customers (down 1.8m YoY at 24.9m including Russian
active customers).
(2) Average customer value calculated as gross billed revenue
over last 12 months divided by active or Premier customers
respectively.
(3) Kantar | ASOS Shoppers | Online | Spend % I 24 w/e 5(th)
March 2023 vs LY.
The free cash outflow of GBP262.7m reflects the reported loss
incurred in the period , the phasing of stock receipts and
payments, with the cash benefit associated with the lower H1 intake
expected in H2 FY23 and capex. Due to historical commitments, FY23
capex is more heavily weighted to the first half of the year, with
GBP115.0m invested in support of technology investments into data
services, data science, merchandising, warehouse, web and payments
platforms, as well as contractual payments relating to the deferred
Lichfield and Atlanta automation projects. The Company maintains
its guidance for full-year capex of GBP175m to GBP200m. Net debt
closed the half at GBP431.7m (H1 FY22: GBP62.6m).
iv. Reinforced leadership team and refreshed culture
The final pillar of the Driving Change agenda relates to
simplification of ASOS' decision-making processes, developing a
culture of innovation across the business, and reinforcing the
senior leadership team with strategic key hires. This process is
approaching completion. The wider, flatter structure that this
represents acts to bring management closer to the organisation and
facilitate quicker decision-making, breaking down silos.
ASOS is pleased to announce the appointment of Dan Elton as
Senior Customer Director and Michelle Wilson as Senior Director of
Strategy and Corporate Development. Supplementing the internal
appointments to the management committee and previously announced
external appointments, Dan and Michelle bring a wealth of relevant
marketing, finance and capital markets experience to the ASOS
leadership. The appointment of Sean Glithero as Interim CFO,
replacing Katy Mecklenburgh who leaves the business following this
results announcement, was also separately announced following the
P1 FY23 trading update. Sean is an experienced CFO with a track
record of delivery across a range of digital and fashion
businesses, and will remain with ASOS until such time as a
permanent CFO is appointed, having joined the business in February
to ensure a thorough handover period. ASOS would like to thank Katy
for her significant contribution during her time at ASOS.
On 6 April 2023, ASOS announced that it had further strengthened
its Board with the appointment of Natasja Laheij and Jose Manuel
Martínez Gutiérrez as Independent Non-Executive Directors joining
the Board on 11 April 2023. Natasja and Jose Manuel have extensive
experience in international commercial and financial management,
e-commerce, and in the retail and fashion industry respectively.
The Company also announced on 6 April 2023, that Patrick Kennedy
stepped down from the Board with effect from 5 April 2023. The
Board would like to thank Patrick for the important contribution he
has made to ASOS. Mai Fyfield, who joined the Board in November
2019, has succeeded Patrick as Senior Independent Director of the
Company.
Against a challenging backdrop, ASOS has achieved a great deal
in this period of reset and is well positioned to return to
profitability in H2 FY23 and beyond. While there remains much to be
delivered in the next few months, I am confident that the ASOS will
exit the year a more resilient and sustainably profitable
business.
José Antonio Ramos Calamonte
Chief Executive Officer
Financial review
All revenue growth figures are stated at constant currency
throughout this document unless otherwise indicated.
Overview
Six months to 28 February 2023
UK EU US RoW(1) Total reported Adjusting Total
items(4) adjusted
GBPm GBPm GBPm GBPm GBPm GBPm GBPm
Retail sales(2) 775.1 572.7 244.3 172.7 1,764.8 (2.1) 1,762.7
Income from
other
services(3) 28.6 13.9 24.9 8.4 75.8 - 75.8
Total revenue 803.7 586.6 269.2 181.1 1,840.6 (2.1) 1,838.5
Cost of sales (1,175.9) 126.7 (1,049.2)
---------------- -------------- ----------------
Gross profit 664.7 124.6 789.3
Distribution
expenses (229.8) - (229.8)
Administrative
expenses (708.4) 78.5 (629.9)
Other income 1.0 - 1.0
---------------- -------------- ----------------
Operating loss (272.5) 203.1 (69.4)
Finance income 2.5 - 2.5
Finance expense (20.9) 0.4 (20.5)
---------------- -------------- ----------------
Loss before tax (290.9) 203.5 (87.4)
================ ============== ================
ASOS delivered an adjusted loss before tax of GBP87.4m for the half,
and a reported loss before tax of GBP290.9m. Adjusting items for the
half totalled GBP203.5m, including the stock-write off (GBP128.2m),
property impairments (GBP49.4m), and other costs associated with implementation
of the Driving Change agenda such as consultancy and restructuring
costs (GBP11.0m). There was also a non-underlying historic sales tax
charge (GBP9.8m) and amortisation relating to the Topshop brands (GBP5.1m).
The total cash outflow relating to adjusting items in the period was
GBP23.0m. Further detail on each of these items can be found in note
3 on pages 23-26.
KPIs excluding Russia(5) Six months Six months Change
to 28 February to 28 February
2023 2022
----------------------------- ---------------- ---------------- --------
Active customers(6) (m) 24.9 25.5 (2%)
Average basket value(7) GBP40.84 GBP37.97 8%
Average basket value CCY(8) GBP39.86 GBP37.97 5%
Average order frequency(9) 3.73 3.75 (1%)
Total shipped orders (m) 43.2 48.8 (11%)
Total visits (m) 1,384.6 1,463.7 (5%)
Conversion(10) 3.1% 3.3% (20bps)
----------------------------- ---------------- ---------------- --------
(1) Rest of World.
(2) Retail sales are internet sales recorded net of an appropriate
deduction for actual and expected returns, relevant vouchers, discounts
and sales taxes.
(3) Income from other services comprises of delivery receipt payments,
marketing services, commission on partner-fulfilled sales and revenue
from wholesale sales.
(4) The adjusting items and the adjusted performance measures used
by ASOS are explained and defined on pages 23-26 and 45-46 respectively.
(5) Calculation of metrics, or movements in metrics, on an ex-Russia
basis involves the removal of Russia from H1 FY22 performance. This
adjustment allows YoY comparisons to be made on a like-for-like basis
following the decision to suspend trade in Russia on 2 March 2022.
The exception to this is visits, where ASOS have also excluded any
visits from Russia in H1 FY23, in addition to H1 FY22.
(6) Defined as having shopped in the last 12 months as at 28 February.
(7) Average basket value is defined as net retail sales divided by
shipped orders.
(8) Average basket value CCY is calculated as constant currency net
retail sales / shipped orders.
(9) Calculated as last 12 months' total shipped orders divided by
active customers.
(10) Calculated as total shipped orders divided by total visits.
KPIs including Russia Six months to Six months Change
28 February 2023 to 28 February
2022
---------------------------------- --------------------- ------------------ ---------
Active customers(1) (m) 24.9 26.7 (7%)
Average basket value(2) GBP40.84 GBP38.47 6%
Average basket value CCY(3) GBP39.86 GBP38.47 4%
Average order frequency(4) 3.73 3.70 1%
Total shipped orders (m) 43.2 50.1 (14%)
Total visits (m) 1,389.5 1,587.2 (12%)
Conversion(5) 3.1% 3.2% (10bps)
---------------------------------- --------------------- ------------------ ---------
Total sales declined by 7%(6) (and (8%) on a reported basis),
with challenging trading conditions affecting sales performance in
P1 FY23 (September to December) continuing into P2 FY23 (January
and February). In addition to widespread cost of living concerns
and their impact on discretionary spend, consumers have returned to
stores post-pandemic causing online penetration to step back in the
short-term (albeit remaining notably higher on a three-year view).
Sales declined further in P2 FY23 in part due to deliberate actions
taken by the Company reflecting the prioritisation of structural
profitability improvements and cash generation over top line
growth. These actions included a reduction of Spring/Summer '23
intake (resulting in reduced assortment width), country-specific
changes to pricing and delivery proposition, reduced investment in
markdown and optimisation of marketing spend. Driving Change
initiatives accounted for broadly half of the sales decline since
December but have driven strengthening order economics and an
improving adjusted gross margin as demonstrated by a recent run
rate up more than 300bps YoY continuing beyond the period end into
March and April.
These deliberate profitability actions also contributed to a 2%
YoY decline in active customers(7) . Premier customers declined by
7% YoY, reflecting increases to subscription prices and the
introduction of, or the increase in, minimum order thresholds for
free delivery in some geographies. However, the average customer
value (8) of both active and Premier customers has increased over
the period. In the UK, ASOS has increased its share of its
customers' wallet by 50bps YoY (9) and taken share in online retail
among the target 16 to 35 demographic(10) . Average basket value
('ABV') increased by 5%(11) , a positive outcome from the planned
profitability initiatives supported by average selling price
increases ('ASP'). Order frequency remained firm, down 1% YoY
against a backdrop of steeper declines in visits, orders and
conversion.
(1) Defined as having shopped in the last 12 months as at 28
February.
(2) Average basket value is defined as net retail sales divided
by shipped orders.
(3) Average basket value CCY is calculated as constant currency
net retail sales / shipped orders.
(4) Calculated as last 12 months' total shipped orders divided
by active customers.
(5) Calculated as total shipped orders divided by total
visits.
(6) Total sales CCY excluding Russia declined by 7% (down 10%
CCY including Russia); total reported sales excluding Russia
declined by 5% (down 8% on a reported basis including Russia).
7 Active customers declined by 0.6m YoY to 24.9m excluding
Russian active customers (down 1.8m YoY at 24.9m including Russian
active customers).
8 Average customer value calculated as gross billed revenue over
last 12 months divided by active or Premier customers
respectively.
9 Kantar | ASOS Shoppers | Online | Spend % I 24 w/e 5th March
2023 vs LY.
(10) Kantar Total Market | Total Clothing, Footwear and
Accessories | Top Retailers | Total , Online | 24 w/e 5th March
2023 vs LY.
(11) Group ABV CCY increased by 5% excluding Russia and
increased by 4% CCY including Russia.
Performance by market
UK
UK KPIs Six months to 28 February
2023
Total Sales -10%
--------------------------
Visits -8%
--------------------------
Orders -14%
--------------------------
Conversion -30bps
--------------------------
ABV +4%
--------------------------
Active Customers 8.6m (-2%)
--------------------------
Sales in the UK declined by 10% against a backdrop of weak
consumer sentiment and a challenging online retail environment.
However UK sales remain c.35% above pre-pandemic levels (c.10% CAGR
since February 2020). Trading was volatile from month to month,
with notable weakness in September (negative news flow relating to
the cost of living) and December (postal strikes).
UK performance was also affected by planned profitability
actions, including more targeted marketing spend, a change in
markdown approach and changes to the Premier proposition. As ASOS
prioritised order profitability ahead of growth, marketing spend
was curtailed in periods of softer demand caused by both weak
consumer sentiment and by challenges in the delivery market around
Christmas and New Year. Markdown spend was deliberately weighted
towards the peak period to accelerate the sell through of aged
stock and facilitate the movement towards the renewed commercial
model. With an increased focus on full-price sales, markdown was
substantially reduced YoY in January and February, resulting in
markdown spend back on the year. Premier subscription prices were
increased from GBP9.95 to GBP11.95 in November 2022 and minimum
order threshold for free delivery were increased in January 2023
from GBP10 to GBP15. However, ASOS continued to grow its share of
the UK online retail market amongst its core 16 to 35 year-old
demographic and increased its share of UK customers' wallet in the
period (1,2) .
As a result of the factors outlined above, ABV increased 4%,
underpinned by a higher ASP (supported by pricing increases and
lower markdown). Visits (-8%), conversion (-30bps), orders (-14%)
and Active Customers (-2%) all fell, reflective of ASOS' focus on
sustainable, profitable growth.
EU
EU KPIs Six months to 28
February 2023
Total Sales +2% (flat CCY)
-----------------
Visits Flat
-----------------
Orders -5%
-----------------
Conversion -10bps
-----------------
ABV +7%
-----------------
ABV (CCY) (3) +6%
-----------------
Active Customers 10.6m (+1%)
-----------------
Constant currency sales in the EU were flat in the period, which
was encouraging in the context of the wider macroeconomic backdrop
and profitability measures taken in the region. EU sales remain 17%
above pre-pandemic levels (c.6% CAGR since February 2020). As in
the UK, markdown was reduced significantly in January and February
with an adverse impact on sales in these months. Country-specific
changes to delivery propositions and order thresholds were also
implemented across the region.
Active customers grew 1% YoY, despite new customer acquisition
being impacted by lower performance marketing spend and reduced
promotional activity in certain EU territories. Encouragingly,
Premier customers have grown strongly, up 13% YoY. Whilst visits
were flat, orders and conversion were down 5% and 10bps
respectively. However, the region saw strong growth in ASP and
consequently growth in ABV. The Netherlands, Ireland and Southern
Europe outperformed, offset by a weaker performance in Northern
Europe.
(1) Kantar Total Market | Total Clothing, Footwear and
Accessories | 16-35 year olds | Market Shares | 24 w/e 5th March
2023 vs LY.
(2) Kantar ASOS Shoppers | Online | Spend % I 24 w/e 5(th) March
2023 vs LY.
(3) ABV (CCY) is calculated as constant currency net retail
sales / shipped orders.
US
US KPIs Six months to 28 February
2023
Total Sales +7% (-7% CCY)
--------------------------
Visits -1%
--------------------------
Orders -12%
--------------------------
Conversion -20bps
--------------------------
ABV +22%
--------------------------
ABV (CCY) (1) +6%
--------------------------
Active Customers 3.2m (-9%)
--------------------------
US sales fell by 7% in the period at constant currency, against
a backdrop of weak consumer sentiment and planned profitability
initiatives. US sales remain 28% above pre-pandemic levels (c.9%
CAGR since February 2020).
As reported in October 2022, return on investment in the US
market in recent years has been particularly disappointing. During
the period, ASOS reallocated capital away from the market,
including reducing marketing spend and took action to improve the
profitability of US orders including the removal of unprofitable
brands and changes to the delivery proposition. While this resulted
in a fall in visits (-1%), conversion (-20bps), orders (-12%) and
active customers (-9%), with ABV +6% in constant currency
(supported by price increases and reduced markdown), the
profitability of the market was substantially improved.
As indicated at P1 FY23, ASOS' wholesale revenue in the US has
slowed due to Topshop and Topman re-stocking in the prior year and
reduced intake in reflection of the weaker consumer backdrop.
Nordstrom remains a critical strategic partner for ASOS in the US
and Topshop and Topman remain core brands in the Nordstrom
portfolio. Sales of Topshop brands through the ASOS platform in the
US were up over 50% in the period.
RoW
RoW KPIs Six months to Six months to 28
28 February 2023 February 2023 including
excluding Russia Russia
(2)
Total Sales -10% (-12% CCY) -35% (-36% CCY)
------------------ -------------------------
Visits -18% -48%
------------------ -------------------------
Orders -21% -45%
------------------ -------------------------
Conversion -10bps +10bps
------------------ -------------------------
ABV +13% +17%
------------------ -------------------------
ABV (CCY)(1) +11% +15%
------------------ -------------------------
Active Customers 2.5m (-7%) 2.5m (-36%)
------------------ -------------------------
Sales in the RoW segment fell by 12%(3) at constant currency and
excluding Russia, having seen some of the most substantial changes
under the country profitability review undertaken in P1 FY23
alongside a sharp reduction in marketing spend YoY. Delivery prices
were increased across the segment alongside widespread changes to
delivery thresholds. Visits, orders and conversion all stepped
back, but ABV increased by 11% supported by pricing .
Active customers declined by 7% YoY. This is largely due to new
customer acquisition remaining challenging, and a more competitive
e-commerce market, in key territories. Premier customers have
increased by 78% YoY, albeit from a low base.
On a territory basis, Saudi Arabia delivered double-digit sales
growth and grew active customers, performing well throughout the
half except during highly competitive key promotional events.
Performance in Australia was challenging in the face of reduced
investment in markdown.
(1) ABV (CCY) is calculated as constant currency net retail
sales / shipped orders.
(2) Calculation of metrics, or movements in metrics, on an
ex-Russia basis involves the removal of Russia from H1 FY22
performance. This adjustment allows YoY comparisons to be made on a
like-for-like basis following the decision to suspend trade in
Russia on 2 March 2022. The exception to this is visits, where ASOS
have also excluded any visits from Russia in H1 FY23, in addition
to H1 FY22.
(3) RoW revenue CCY excluding Russia declined by 12% (down 36%
CCY including Russia).
Gross margin
Adjusted gross margin(1) remained flat from P1 FY23 at 42.9%
(-20bps YoY), demonstrating resilience in the face of headwinds,
including input cost inflation. This was achieved primarily due to
pricing on ASOS own-brands and improving freight rates (both from
improved contract terms and reduced use of air freight).
Reported gross margin was back 700bps to 36.1%. This reflects
the gross profit impact of the stock write-off (of GBP119.7m(1) )
announced alongside ASOS' FY22 results, facilitating the Company's
transition to its new commercial model and the cost of sales
element of the non-underlying sales tax charge of GBP4.9m(2) .
Operating expenses
Six months Six months
to 28 February % of to 28 February % of
GBPm 2023 sales 2022 sales Change
------------------------------- ---------------- --------- ---------------- -------- -------
Distribution costs (229.8) 12.5%(3) (255.6) 12.8% 10%
12.4%
Warehousing (227.9) (3) (207.2) 10.3% (10%)
6.0%
Marketing (109.9) (3) (119.7) 6.0% 8%
11.9%
Other operating costs (218.1) (3) (186.1) 9.3% (17%)
4.0%
Depreciation and amortisation (74.0) (3) (68.4) 3.4% (8%)
------------------------------- ---------------- --------- ---------------- -------- -------
Total operating costs 46.8%
(excl. adjusting items) (859.7) (3) (837.0) 41.8% (3%)
------------------------------- ---------------- --------- ---------------- -------- -------
Adjusting items(4) (78.5) 4.2% (30.6) 1.5% (157%)
------------------------------- ---------------- --------- ---------------- -------- -------
Total operating costs (938.2) 51.0% (867.6) 43.3% (8%)
------------------------------- ---------------- --------- ---------------- -------- -------
Total operating costs excluding adjusting items increased by 3%
YoY and by 500bps as a percentage of sales, reflecting the impact
of inflationary pressures, increased return rates and deleverage on
fixed costs.
Distribution costs as a percentage of sales decreased by 30bps
YoY to 12.5%, with the impact of cost saving measures under the
Driving Change agenda more than offsetting increased fuel
surcharges. In November 2021, ASOS began fulfilling "split orders"
after the opening of the Lichfield fulfilment centre. Split orders
involved parcels being shipped from both Lichfield and Barnsley to
fulfil a single order, and whilst split orders benefitted the
customer proposition by ensuring maximum stock availability, they
also increased fulfilment costs. As part of the Driving Change
agenda, split orders were discontinued in January 2023, with
Barnsley now holding all SKUs available for sale at any point in
time, reducing distribution costs. Other measures taken include
bringing more of the sortation process in-house, reducing
costs.
Warehouse costs as a percentage of sales have increased by
210bps YoY to 12.4% due to increased labour inflation across all
fulfilment centres, in addition to inflation in consumables and
utilities and return rates normalisation. The high levels of stock
reported at FY22 results created inefficiencies in the first few
months of the year, that diminished as excess stock was cleared.
Driving Change agenda initiatives designed to mitigate warehouse
inflation include the winding down of ancillary storage,
facilitated by the exceptional stock write-off, alongside
simplification of UK returns infrastructure.
Marketing costs decreased by 8% YoY and remained flat at 6.0% of
sales, despite increase in cost per click, as ASOS showed greater
restraint on spending and focused on optimising investment to
generate greater returns, in some cases reallocating spend between
geographies based on underlying market conditions. Marketing
investments were made ahead of peak trading in P1 FY23, but spend
has since been scaled back, in-line with the Company's
prioritisation of profitability over top-line growth.
Other operating costs as a percentage of sales increased by
260bps YoY (excluding adjusting items) due to the annualisation
impact of headcount added in FY22 as well as wage inflation and
contractual increases in third party technology services and
overhead costs (including electricity, insurance, rates and waste
management costs).
(1) Excluding the gross profit impact of the stock write-off
GBP119.7m announced at FY22 and the non-underlying sales tax of
GBP4.9m (see more detail in note 3 on pages 23-26). Total P&L
impact of the stock write-off was GBP128.2m at H1 FY23 of which
GBP119.7m related to gross profit, GBP7.8m warehousing costs and
GBP0.7m depreciation costs. An additional c.GBP3.0m net P&L
impact is expected to be booked in H2 FY23.
(2) Further detail in note 3 on pages 23-26.
(3) As a percentage of adjusted revenue
(4) Further detail on adjusting items can be found on pages
23-26
Depreciation and amortisation costs as a percentage of sales
increased by 60bps YoY (excluding Topshop brands amortisation). The
increase in depreciation was driven by increased warehouse
capitalisation costs (including relating to Lichfield fulfilment
centre) and employee tech upgrades. The increase in amortisation
relates to growth in intangible assets including data services,
operations systems and web and payments platforms.
Interest
Net interest costs were GBP18.4m in the period, an increase of
GBP7.0m YoY primarily resulting from the drawdown of GBP250m on the
Revolving Credit Facility on 8(th) September 2022.
Taxation
The reported effective tax rate ('ETR') is 25.0% based on the
reported loss before tax of GBP290.9m. The H1 FY23 reported tax
rate is different from the full year forecast rate of 21.1% due to
a loss being incurred in H1 FY23, which is forecast to
significantly reduce in H2 FY23. This loss creates a deferred tax
asset, recognised at the higher rate of 25.0%, compared with the
current year rate of 21.5%. This asset reduces in H2 FY23, and so
the rate differential has a smaller impact on the overall ETR.
Going forward, ASOS expects the effective tax rate to be
slightly higher than the prevailing rate of UK corporation tax due
to permanently disallowable items and the higher tax rate paid in
some of the non-UK based entities.
Earnings per share
Both basic and diluted loss per share were 218.7p (H1 FY22:
basic and diluted loss per share of 13.5p). The decrease was driven
by the reported loss before tax of GBP290.9m, down from a reported
loss before tax of GBP15.8m last year. The potentially convertible
shares related to both the convertible bond and ASOS' employee
share schemes have been excluded from the calculation of diluted
loss per share as they are anti-dilutive for the six months ended
28 February 2023.
Free Cash flow
There was a free cash outflow(1) for the half of GBP262.7m
excluding the drawdown of GBP250.0m RCF on 8 September 2022, and
ASOS ended the period with a net debt position of GBP431.7m. This
was mainly driven by the reported EBITDA loss of GBP189.2m and
capex investment weighted towards the first half.
The working capital outflow of GBP13.3m reflects the decrease of
trade and other payables largely offset by the lower stock position
versus FY22 as ASOS ended the period with stock of GBP978.4m (FY22:
GBP1,078.4m, H1 FY22: GBP986.4m). This is resulting from the
previously announced stock write-off(2) in line with the new
commercial model and the phasing of stock receipts and payments,
with the cash benefit associated with the lower H1 intake expected
in H2 FY23 .
Capital expenditure totalled GBP115.0m in support of technology
investments into data services, operations systems and web and
payments platforms, as well as contractual payments relating to the
deferred Lichfield and Atlanta automation projects.
Katy Mecklenburgh
Interim Chief Financial Officer
(1) Definition of free cash outflow can be found on pages
45-46.
(2) Total stock impact on the balance sheet was GBP121.8m at H1
FY23.
CONSOLIDATED INCOME STATEMENT (unaudited)
for the six months to 28 February 2023
Six months to 28 February Six months to 28 February
2023 (unaudited) 2022 (unaudited)
-------------------- ------- ----------------------------------
Adjusted Adjusting Reported Adjusted Adjusting Reported
Note items (note items
3) (note 3)
GBPm GBPm GBPm GBPm GBPm GBPm
----------
Revenue 1,838.5 2.1 1,840.6 2,004.1 - 2,004.1
Cost of sales (1,049.2) (126.7) (1,175.9) (1,140.9) - (1,140.9)
-------------------- ------- ---------- ------------- ---------- ---------- ---------- ----------
Gross profit 789.3 (124.6) 664.7 863.2 - 863.2
Distribution
expenses (229.8) - (229.8) (255.6) - (255.6)
Administrative
expenses (629.9) (78.5) (708.4) (581.4) (30.6) (612.0)
Other income 1.0 - 1.0 - - -
Operating
(loss)/profit (69.4) (203.1) (272.5) 26.2 (30.6) (4.4)
Finance income 5 2.5 - 2.5 0.1 - 0.1
Finance expense 5 (20.5) (0.4) (20.9) (11.5) - (11.5)
(Loss)/profit
before tax (87.4) (203.5) (290.9) 14.8 (30.6) (15.8)
Income tax
credit 6 22.2 50.5 72.7 (3.8) 6.1 2.3
-------------------- ------- ---------- ------------- ---------- ---------- ---------- ----------
(Loss)/Profit
for the financial
period (65.2) (153.0) (218.2) 11.0 (24.5) (13.5)
-------------------- ------- ---------- ------------- ---------- ---------- ---------- ----------
Loss per
share
-------------------- ------- ---------- ------------- ---------- ---------- ---------- ----------
Basic per
share 7 (218.7p) (13.5p)
Diluted per
share 7 (218.7p) (13.5p)
-------------------- ------- ---------- ------------- ---------- ---------- ---------- ----------
All activities are continuing.
The notes on pages 20 to 42 form part of this condensed
consolidated financial information.
CONSOLIDATED STATEMENT OF COMPREHENSIVE (LOSS)/INCOME
(UNAUDITED)
for the six months to 28 February 2023
Six months Six months
to 28 to 28
February February
2023 2022
(unaudited) (unaudited)
GBPm GBPm
-------------------------------------------------------- -------------- -------------
Loss for the financial period (218.2) (13.5)
-------------------------------------------------------- -------------- -------------
Items that will not be reclassified to Group income
statement
Fair value (losses)/gains on cash flow hedges (13.3) 7.1
Tax on items that will not be reclassified 2.4 (0.3)
-------------------------------------------------------- -------------- -------------
(10.9) 6.8
Items that may be subsequently reclassified to Group
income statement
Net translation movements offset in reserves - 0.1
Fair value gains on cash flow hedges 13.7 30.5
Fair value movements reclassified from cash flow hedge
reserve to Group income statement 1.1 (6.6)
Income tax charge relating to these items (0.2) (5.2)
-------------------------------------------------------- -------------- -------------
14.6 18.8
-------------------------------------------------------- -------------- -------------
Other comprehensive income for the financial period 3.7 25.6
-------------------------------------------------------- -------------- -------------
Total comprehensive (loss)/income for the financial
period attributable to owners of the parent company (214.5) 12.1
-------------------------------------------------------- -------------- -------------
The notes on pages 20 to 42 form part of this condensed
consolidated financial information.
CONSOLIDATED BALANCE SHEET (UNAUDITED)
at 28 February 2023
Note 28 February 28 February 31 August
2023 2022* 2022*
(unaudited) (unaudited) (audited)
GBPm GBPm GBPm
---------------------------------- ----- -------------- ------------- -----------
Non-current assets
Goodwill and other intangibles 8 703.6 664.3 683.9
Property, plant and equipment 9 367.4 324.7 351.7
Right-of-use assets 10 299.9 354.7 380.3
Investment properties 2 12.8 - -
Deferred tax assets 15.2 - -
Derivative financial assets 13 9.7 14.7 27.0
---------------------------------- ----- --------------
1,408.6 1,358.4 1,442.9
---------------------------------- ----- -------------- ------------- -----------
Current assets
Inventories 978.4 986.4 1,078.4
Trade and other receivables 63.4 87.4 88.2
Derivative financial assets 13 25.2 40.8 41.4
Cash and cash equivalents 308.6 406.7 323.0
Current tax asset 3.9 8.7 23.0
---------------------------------- ----- --------------
1,379.5 1,530.0 1,554.0
---------------------------------- ----- -------------- ------------- -----------
Current liabilities
Trade and other payables 11 (837.3) (927.0) (993.3)
Borrowings 14 (9.3) (1.4) (1.4)
Lease liabilities 10 (29.8) (24.9) (24.3)
Derivative financial liabilities 13 (11.2) (6.5) (21.0)
Provisions 12 (1.7) - -
(889.3) (959.8) (1,040.0)
---------------------------------- ----- -------------- ------------- -----------
Net current assets 490.2 570.2 514.0
---------------------------------- ----- -------------- ------------- -----------
Non-current liabilities
Lease liabilities 10 (316.1) (320.2) (355.8)
Deferred tax liability - (45.6) (58.2)
Provisions 12 (54.2) (45.9) (41.9)
Derivative financial liabilities 13 (3.8) (1.8) (11.6)
Borrowings 14 (731.0) (467.9) (474.5)
---------------------------------- ----- -------------- ------------- -----------
(1,105.1) (881.4) (942.0)
---------------------------------- ----- -------------- ------------- -----------
Net assets 793.7 1,047.2 1,014.9
---------------------------------- ----- -------------- ------------- -----------
Equity attributable to owners
of the parent
Called up share capital 3.5 3.5 3.5
Share premium 245.7 245.7 245.7
Employee Benefit Trust reserve 2.1 2.1 2.1
Hedging reserve 18.9 39.8 26.2
Translation reserve (2.7) (2.3) (2.7)
Equity portion of convertible
debt 58.9 58.9 58.9
Retained earnings 467.3 699.5 681.2
---------------------------------- ----- -------------- ------------- -----------
Total equity 793.7 1,047.2 1,014.9
---------------------------------- ----- -------------- ------------- -----------
*See note 2 for detail on presentational changes
The notes on pages 20 to 42 form part of this condensed
consolidated financial information.
These unaudited condensed consolidated interim financial
statements for the six months ended 28 February 2023 were approved
by the Board on 9 May 2023.
CONSOLIDATED Statement of Changes in EquitY (UNAUDITED)
for the six months to 28 February 2023
Equity
Called Employee portion
up Benefit of
share Share Trust Hedging Translation convertible Retained Total
capital premium reserve(1) reserve reserve debt earnings(2) equity
GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm
--------------- --------- --------- ----------- ---------- ------------- ------------- ------------- ---------
At 1 September
2022 3.5 245.7 2.1 26.2 (2.7) 58.9 681.2 1,014.9
--------------- --------- --------- ----------- ---------- ------------- ------------- ------------- ---------
Loss for the
period - - - - - - (218.2) (218.2)
Other
comprehensive
income for
the period - - - 3.7 - - - 3.7
--------------- --------- --------- ----------- ---------- ------------- ------------- ------------- ---------
Total
comprehensive
income/(loss)
for the
period - - - 3.7 - - (218.2) (214.5)
--------------- --------- --------- ----------- ---------- ------------- ------------- ------------- ---------
Cash flow
hedges gains
and losses
transferred
to
non-financial
assets - - - (11.0) - - - (11.0)
Share-based
payments
charge - - - - - - 4.0 4.0
Tax relating
to share
option
scheme - - - - - - 0.3 0.3
--------------- --------- --------- ----------- ---------- ------------- ------------- ------------- ---------
Balance as
at 28
February
2023 3.5 245.7 2.1 18.9 (2.7) 58.9 467.3 793.7
--------------- --------- --------- ----------- ---------- ------------- ------------- ------------- ---------
At 1 September
2021 3.5 245.7 2.1 14.3 (2.4) 58.9 711.9 1,034.0
--------------- --------- --------- ----------- ---------- ------------- ------------- ------------- ---------
Loss for the
period - - - - - - (13.5) (13.5)
Other
comprehensive
income for
the period - - - 25.5 0.1 - - 25.6
--------------- --------- --------- ----------- ---------- ------------- ------------- ------------- ---------
Total
comprehensive
income/(loss)
for the
period - - - 25.5 0.1 - (13.5) 12.1
--------------- --------- --------- ----------- ---------- ------------- ------------- ------------- ---------
Share-based
payments
charge - - - - - - 1.9 1.9
Tax relating
to share
option
scheme - - - - - - (0.8) (0.8)
--------------- --------- --------- ----------- ---------- ------------- ------------- ------------- ---------
Balance as
at 28
February
2022 3.5 245.7 2.1 39.8 (2.3) 58.9 699.5 1,047.2
--------------- --------- --------- ----------- ---------- ------------- ------------- ------------- ---------
At 1 September
2021 3.5 245.7 2.1 14.3 (2.4) 58.9 711.9 1,034.0
--------------- --------- --------- ----------- ---------- ------------- ------------- ------------- ---------
Loss for the
year - - - - - - (30.8) (30.8)
Other
comprehensive
income/(loss)
for the year - - - 6.4 (0.3) - - 6.1
--------------- --------- --------- ----------- ---------- ------------- ------------- ------------- ---------
Total
comprehensive
income/(loss)
for the year - - - 6.4 (0.3) - (30.8) (24.7)
--------------- --------- --------- ----------- ---------- ------------- ------------- ------------- ---------
Cash flow
hedges
gains and
losses
transferred
to
non-financial
assets - - - 5.5 - - - 5.5
Share-based
payments
charge - - - - - - 0.8 0.8
Tax relating
to share
option
scheme - - - - - - (0.7) (0.7)
--------------- --------- --------- ----------- ---------- ------------- ------------- ------------- ---------
Balance as
at 31 August
2022 3.5 245.7 2.1 26.2 (2.7) 58.9 681.2 1,014.9
--------------- --------- --------- ----------- ---------- ------------- ------------- ------------- ---------
(1) Employee Benefit Trust and Link Trust
(2) Retained earnings includes the share-based payments
reserve
The notes on pages 20 to 42 form part of this condensed
consolidated financial information.
CONSOLIDATED CASH FLOW STATEMENT (UNAUDITED)
for the six months to 28 February 2023
Six months Six months
to to
28 February 28 February
2023 2022*
(unaudited) (unaudited)
GBPm GBPm
-------------------------------------------------------- ------------- -------------
Operating loss (272.5) (4.4)
Adjusted for:
Depreciation of property, plant and equipment and
right-of-use assets 34.5 30.0
Amortisation of other intangible assets 48.8 43.7
Impairment loss on property, plant and equipment,
intangible assets and right-of-use assets 28.9 18.9
Share-based payments charge 3.3 1.5
Other non-cash items 4.6 0.3
Decrease/(Increase) in inventories 99.9 (181.3)
Decrease/(increase) in trade and other receivables 28.8 (30.2)
Decrease in trade and other payables (142.0) (34.4)
Increase in provisions 14.0 2.7
-------------------------------------------------------- ------------- -------------
Cash used in operating activities (151.7) (153.2)
Income tax received 23.5 2.0
-------------------------------------------------------- ------------- -------------
Net cash used in operating activities (128.2) (151.2)
Investing activities
Purchase of other intangible assets (68.8) (53.4)
Purchase of property, plant and equipment (46.2) (33.1)
Interest received 2.5 0.1
-------------------------------------------------------- ------------- -------------
Net cash used in investing activities (112.5) (86.4)
Financing activities
Drawdown of Revolving Credit Facility (RCF) 250.0 -
Refinancing amendment fees paid (3.9) -
Repayment of principal portion of lease liabilities (12.1) (13.4)
Interest paid (6.0) (5.5)
-------------------------------------------------------- ------------- -------------
Net cash generated from/(used in) financing activities 228.0 (18.9)
-------------------------------------------------------- ------------- -------------
Net decrease in cash and cash equivalents (12.7) (256.5)
-------------------------------------------------------- ------------- -------------
Opening cash and cash equivalents 323.0 662.7
Effect of exchange rates on cash and cash equivalents (1.7) 0.5
-------------------------------------------------------- ------------- -------------
Closing cash and cash equivalents 308.6 406.7
-------------------------------------------------------- ------------- -------------
*See note 2 for detail on presentational changes
The notes on pages 20 to 42 form part of this condensed
consolidated financial information.
Notes to the Condensed Consolidated Interim Financial Statements
(unaudited)
1. General information
ASOS Plc ('the Company') and its subsidiaries (together, 'the
Group') is a global fashion retailer. The Group sells products
across the world and has websites targeting countries that include
the UK, US, Australia, France, Germany, Spain, Italy, Sweden, the
Netherlands, Denmark and Poland. The Company is a public limited
company whose shares are publicly traded on the London Stock
Exchange. The Company is incorporated and domiciled in the UK and
the address of its registered office is Greater London House,
Hampstead Road, London NW1 7FB.
The financial period represents the six months to 28 February
2023 (comparative financial period six months to 28 February 2022;
prior financial year 12 months to 31 August 2022). The financial
information comprises the results of the Company and its
subsidiaries.
2. Basis of preparation
The interim financial statements for the six months to 28
February 2023 have been prepared in accordance with the UK-adopted
IAS 34, "Interim Financial Reporting" and the Disclosure Guidance
and Transparency Rules of the United Kingdom's Financial Conduct
Authority. The interim financial statements should be read in
conjunction with the Group's Annual Report and Accounts for the
year to 31 August 2022, which was prepared in accordance with UK
adopted international accounting standards in conformity with the
requirements of the Companies Act 2006.
The interim financial statements have been reviewed, not
audited, and do not constitute statutory accounts within the
meaning of section 434 of the Companies Act 2006. The Annual Report
and Accounts for the year to 31 August 2022 have been filed with
the Registrar of Companies. The auditors' report on those accounts
was unqualified, did not include a reference to any matters to
which the auditors drew attention by way of emphasis without
qualifying the report and did not contain statements under section
498 of the Companies Act 2006.
The financial information contained in the Interim Results is
presented in sterling, rounded to the nearest million (GBPm) unless
otherwise stated.
2.1. Going concern
The Directors are satisfied that the Group has sufficient
resources to continue in operation for a period of at least 12
months from the date of approval of the financial statements, and
therefore continue to adopt the going concern basis in preparing
the financial statements. In assessing the Group's going concern
position, the Directors considered the Group's business activities
and principal risks, reviewing the Group's forecasted cash flows,
liquidity positions and borrowing facilities for the 18-month
period to August 2024.
In assessing the Group's going concern position, the Directors
have considered the Group's detailed forecasting process which
considers the Group's financial performance, position and cash
flows over the going concern period (the base case). These cash
flow forecasts represent the Directors' best estimate of trading
performance and costs implications in the market based on current
agreements, market experience and consumer demand expectations. In
conjunction with this, the Directors considered the Group's
business activities and principal risks, reviewing the Group's cash
flows, liquidity positions and borrowing facilities for the going
concern period. The review included the recent amendment and
extension (which extends the maturity of the facility to November
2024) to the Group's Revolving Credit Facility (RCF) agreement that
was obtained in May 2023, further detail is included within Note
18. At 28 February 2023, the Group had GBP250m of the GBP350m RCF
drawn (plus GBP50m ancillary facilities following exercise of a
GBP50m accordion option in December 2022) and GBP500m convertible
bonds with a maturity of April 2026.
2. Basis of preparation continued
As part of the assessment, the Group has considered various
severe but plausible downside scenarios comprising a combination of
scenarios. The downside scenarios include assumed reductions in
forecast sales during the period under review of between 8% and
11%, and gross margin reductions of between 1% to 2%. Working
capital shocks in excess of GBP100m and interest rate rises were
modelled over the period, varying by month, with applied
mitigations over and above the base case also being reflected in
the projections. In both the base case and the severe but plausible
downside scenario, the forecasts indicated that there was
sufficient covenant headroom and liquidity for the business to
continue based on the facilities available to the Group as
described above.
Reverse stress tests have also been performed on both the
Group's revenue and gross margin to see how far these would need to
decline to cause a liquidity event. To test sales, the working
capital shock used in the plausible downside scenario, and a gross
margin decline of 2% were overlaid on the base case and then sales
reduced until there was a covenant breach; sales could decline by a
further 15% over the base case before there was a breach. To test
gross margin, the working capital shock used in the plausible
downside scenario and an average sales decline of 4% were overlaid
on the base case allowing a gross margin decline of 4% before there
was a breach. Both scenarios are considered remote based on results
of previous significant economic shock events, particularly on the
basis that the Group is annualising the softer market growth and
global supply chain crisis experienced this year.
Based on the above, the Directors considered it appropriate to
adopt the going concern basis of accounting in the preparation of
the Group's financial statements.
2.2. Changes in presentation
Other comprehensive income
In accordance with IAS 1 'Presentation of Financial Statements',
within the Consolidated Statement of Comprehensive (Loss)/Income,
the Group presents items that may be and will not be subsequently
reclassified to the income statement, which includes the fair value
movements on effective cash flow hedges. In accordance with IFRS 9
'Financial Instruments', cash flow hedge gains and losses in
relation to purchases of non-financial assets are recognised as
part of the cost of the non-financial asset (a basis adjustment).
For the Group this relates to foreign currency denominated
purchases of inventory and property plant and equipment. The
carrying value of the asset is adjusted for the accumulated gains
or losses recognised directly in other comprehensive income, and
then recognised in the income statement when sold (for inventory)
or as depreciated (for property, plant and equipment).
This basis adjustment is not part of other comprehensive income.
The Group has therefore separately presented effective fair value
movements on hedges relating to inventory and property, plant and
equipment, and those relating to effective hedges of foreign
currency denominated sales, within the Consolidated Statement of
Comprehensive (Loss)/Income, and shown the basis adjustments as a
separate line within the Consolidated Statement of Changes in
Equity. Comparative period amounts have not been adjusted on the
grounds of materiality.
Consolidated balance sheet
The presentation of the Consolidated balance sheet has been
updated as follows:
-- Goodwill and other intangible assets are now disclosed as one line item
-- Right-of-use assets are now presented separately from property, plant and equipment
The comparatives have also been updated to reflect these
changes.
Consolidated cash flow statement
The presentation of the Consolidated cashflow statement has been
updated so that movements in provisions are shown separately. These
were previously included within movements in trade and other
payables.
2. Basis of preparation continued
Reclassification of right-of-use assets as investment
property
The Group has been subletting unused office space within its
Leavesden property since November 2021, and as disclosed in note 3,
further space has been vacated during the year with a view to
ultimately sub-letting. As a result, the related space has been
assessed to meet the definition of investment property under IAS 40
"Investment Properties". Right-of-use assets with a net book value
of GBP12.8m have therefore been transferred from right-of-use
assets to investment property during the year.
Comparative period amounts as at 28 February 2022 of GBP14.8m
(and 31 August 2022: GBP13.5m) are not considered material,
therefore have not been adjusted. The accounting policy for
investment property is disclosed below, and is in line with that
for the respective right-of-use assets. As a result, there is no
change on profit and loss, net assets nor earnings per share.
Investment properties accounting policy
Investment property assets are carried at cost less accumulated
depreciation and any recognised impairment in value. The
depreciation policies for investment property are consistent with
those described for right-of-use assets.
2.3. Accounting policies
The Group has considered the following amendments to published
standards that are effective for the Group for the financial year
beginning 1 September 2022 and concluded that they are either not
relevant to the Group or that they do not have a significant impact
on the Group's financial statements other than disclosures.
-- Onerous Contracts - Cost of Fulfilling a Contract - Amendments to IAS 37
-- Annual Improvements to IFRS Standards 2018-2020
-- Property, Plant and Equipment: Proceeds before Intended Use (Amendments to IAS 16)
-- Reference to the Conceptual Framework - Amendments to IFRS 3
The interim financial statements have been prepared in
accordance with the accounting policies set out in the Annual
Report and Accounts for the year to 31 August 2022, with the
exception of the items noted in note 2.2 above.
2.4. Significant accounting judgements and key sources of
estimation uncertainty
The preparation of interim financial statements requires
management to make judgements, estimates and assumptions that
affect the application of accounting policies and reported amounts
of assets and liabilities, income and expense. Actual results might
differ from these estimates.
In preparing these condensed consolidated interim financial
statements, the significant judgements made by management in
applying the Group's accounting policies and the key sources of
estimation uncertainty were the same as those applied to the
consolidated financial statements for the year ended 31 August
2022, with the exception of the following items, which are
concluded to no longer be significant judgements for the Group:
-- Legal contingencies - the Group has no material contingent
liabilities to disclose, therefore this is no longer considered a
significant judgement
-- Post balance sheet events - the prior year judgement was
specifically in relation to the Group's commercial model change,
therefore is no longer a post balance sheet event.
2.5. Alternative performance measures (APMs)
In the reporting of financial information, the Directors use
various APMs. These APMs are defined and reconciled on pages 45-46,
and should be considered in addition to, and are not intended to be
a substitute for, IFRS measurements. As they are not defined by
International Financial Reporting Standards, they may not be
directly comparable with other companies' APMs.
3. Adjusted profit/(loss) before tax
In order to support shareholders' reviews of the year-on-year
performance of the business, an adjusted measure of profit is
provided to supplement the reported IFRS numbers. This aligns to
how the business measures performance internally.
Judgement is required when determining which items are to be
adjusted. In doing so, the Group considers items which are
significant, either in size and/or nature, the inclusion of which
could distort comparability between periods. The same assessment is
applied consistently to any reversals of prior-period adjusting
items. Adjusted profit/(loss) before tax (and similarly adjusted
EBIT) is not an IFRS measure and therefore not directly comparable
to other companies - refer to "Alternative Performance Measures" in
the appendix for further detail.
More details on each adjusting item are included further
below:
Six months to 28 February 2023 (unaudited)
----------------------------------------------------------------------------------------- --------
Revenue Cost of Administrative Finance Total
sales expenses expenses
GBPm GBPm GBPm GBPm GBPm
---------------------------------------- -------- -------- --------------- ---------- --------
Driving Change agenda
Commercial operating
model 2.1 (121.8) (8.5) - (128.2)
Property-related costs - - (49.4) - (49.4)
Other strategic initiatives - - (10.6) (0.4) (11.0)
Non-underlying sales
tax - (4.9) (4.9) - (9.8)
Amortisation of acquired
intangible assets - - (5.1) - (5.1)
---------------------------------------- -------- -------- --------------- ---------- --------
2.1 (126.7) (78.5) (0.4) (203.5)
---------------------------------------- -------- -------- --------------- ---------- --------
Six months to 28 February 2022 (unaudited)
-----------------------------------------------------------------------------------
Revenue Cost of Administrative Finance Total
sales expenses expenses
GBPm GBPm GBPm GBPm GBPm
-------------------------------- --------- --------- --------------- ---------- -------
ASOS Re-imagined - - (7.9) - (7.9)
Main Market transition costs - - (5.5) - (5.5)
Impairment of Leavesden assets - - (18.3) - (18.3)
Employee and other liabilities
relating to Topshop brands
acquisition - - 6.4 - 6.4
Amortisation of acquired
intangible assets - - (5.3) - (5.3)
-------------------------------- --------- --------- --------------- ---------- -------
- - (30.6) - (30.6)
--------- ------------------------------------------ --------------- ---------- -------
3. Adjusted profit/(loss) before tax continued
Driving Change agenda
In October 2022, the Group announced a change agenda to
strengthen ASOS over the next 12 months and reorient the business
towards the future, underpinned by four key actions:
a) A Renewed commercial model: Acceleration of changes in ASOS'
approach to merchandising and buying in support of a more
competitive proposition and tighter stock turnover.
b) Stronger order economics and a lighter cost profile: Actions
to improve order economics and ensure a sustainable level of
profitability in all markets, whilst focusing efforts on key
markets in conjunction with a focus on optimising the Group's cost
base, improving supply chain efficiencies, and eliminating excess
costs through increased controls. This includes optimising the
Group's space requirements through a mix of repurposing existing
capacity and vacating any excess capacity.
c) Robust, flexible balance sheet: Aligning future investment
with capacity requirements to ensure a more efficient allocation of
capital, while maintaining planned strategic investment in
technology in support of an improved customer experience. In
addition, maintaining sufficient headroom on facilities, ensuring
flexibility in the short term.
d) Enabled by a reinforced leadership team and refreshed
culture: Simplifying decision-making processes to encourage a
culture of innovation and creativity across the business, while
reinforcing the senior leadership team with strategic key
hires.
Various items of income and expenditure have been incurred
during the period in relation to this, as outlined below.
3. Adjusted profit/(loss) before tax continued
Commercial operating model
As outlined in the FY22 results on 19th October 2022, a key
focus for ASOS in FY23 is the renewal of the commercial operating
model. The updated model aims to operate a shorter buying cycle
with an accelerated speed to market, facilitating an enhanced
customer proposition that offers new products, more regularly. To
achieve this, ASOS is utilising off-site clearance routes that will
enable the Group to clear inventory earlier in its lifecycle than
previously, therefore reducing the overall breadth of inventory
held in fulfilment centres, which in turn will reduce the volume
that is sold on promotion via the ASOS site.
To transition to the new model, a reshaping of the inventory
portfolio is required, and as a result additional costs have been
recognised in relation to stock cleared during the period, as well
as provisions for stock held that will be sold through alternative
clearance channels.
GBPm
------------------------------------------------------------ --------
Losses on the sale of stock sold cleared during the period (12.7)
Associated holding and extraction costs incurred during
the period (8.5)
Inventory provisions on stock remaining to be cleared (107.0)
------------------------------------------------------------ --------
(128.2)
------------------------------------------------------------ --------
Losses on the sale of stock during the period are net of income
received of GBP2.1m.
Property related costs
During the period it was agreed to vacate a number of
Group-occupied sites, including office and warehouse space. As a
result, costs of GBP49.4m have been incurred, comprising the
following:
GBPm
------------------------------------------------- -------
Impairment of property, plant and equipment (a) (5.7)
Impairment of intangible assets (a) (1.7)
Impairment of right of use assets (a) (21.5)
Accelerated depreciation (b) (3.5)
Exit provisions (c) (17.0)
------------------------------------------------- -------
(49.4)
------------------------------------------------- -------
a) Impairment of assets for sites vacated during the financial period
b) Where sites are to be vacated during the second half of the
year, the remaining useful economic lives of corresponding sites
have been reassessed to align with closure dates, resulting in an
acceleration in depreciation of these assets. The accelerated
depreciation (over and above the charge absent the closure
decision) is recognised within adjusting items.
c) Exit provisions relate to onerous contract costs on leased
sites that have been identified for closure. Upon initial
recognition of exit provisions, management uses its best estimates
of the relevant costs to be incurred as well as expected closure
dates. This excludes business rates on leased property which are
recognised in the period they are incurred.
Whilst the properties remain vacant, ongoing expenses relating
to lease interest, onerous provision unwinds and business rates
(totalling approximately GBP2m per year) will be reported outside
adjusted profit given they do not relate to operational sites of
the Group.
3. Adjusted profit/(loss) before tax continued
Other strategic initiatives
Other priorities for FY23 communicated at the FY22 results
included; (i) stronger order economics and a lighter cost profile,
(ii) a robust, flexible balance sheet, and, (iii) a reinforced
leadership team and refreshed culture. ASOS has progressed with
each of these priorities during the period, with non-underlying
costs of GBP11.0m incurred, relating to external consultancy costs
to support the launch of the programme and the identification of
initiatives, business restructuring costs including severance, and
costs incurred associated with the revolving credit facility
covenant waiver as disclosed at year-end. The Driving Change agenda
has replaced the Group's ASOS Reimagined programme that commenced
in the prior year.
Costs incurred last year in relation to ASOS Reimagined totalled
GBP25.4m, bringing cumulative change agenda costs incurred to date
to GBP214.0m, of which GBP32.6m is cash (inclusive of the
commercial operating model update).
Non-underlying sales tax
During the period, a historic overstatement of recoverable sales
tax receivables was identified. The balance had built up over a
number of years, predominantly prior to 2020. As at the year-end 31
August 2022, the cumulative amount on the balance sheet totalled
GBP9.8m. Sales tax recognised on the balance sheet of GBP9.8m has
therefore been written off this year. Furthermore, the adjustment
is not considered to have a material impact on the prior year
balance sheet nor income statement, therefore the comparative
results have not been restated. Given this is an out of period cost
and could distort comparability between reporting periods, this has
been included as an adjusting item.
Amortisation of acquired intangible assets
Amortisation of acquired intangible assets is adjusted for as
the acquisition the amortisation relates to was outside
business-as-usual operations for ASOS. These assets would not
normally be recognised outside of a business combination, therefore
the associated amortisation is adjusted.
Classification as adjusting items
Given a number of the costs incurred as part of the above
programmes facilitate future ongoing cost savings, it was
considered whether it was appropriate to report these costs within
adjusted profit/(loss). Whilst they arise from changes in the
Group's underlying operations, they can be separately identified,
are significant in size / nature and their inclusion within
adjusted profit/(loss) does not facilitate meaningful comparison
between financial years. Furthermore the costs incurred arise as a
result of implementing changes for the future to evolve and reshape
the business and are therefore not reflective of ordinary, in-year
trading activity, and for areas being closed or restructured, these
operations no longer relate to the Group's trading operations.
Exclusion from adjusted profit/(loss) is therefore considered
appropriate.
Cash flow impact of adjusting items
The total cash flow impact of adjusting items is as follows:
Six months to Six months to
28 February 2023 (unaudited) 28 February 2022 (unaudited)
GBPm GBPm
------------------------------------------------------ ------------------------------ ------------------------------
Commercial operating model change (0.9) -
Other strategic initiatives (including ASOS
Reimagined) (22.1) (6.1)
Main Market transition costs - (1.7)
Total adjusting items within operating cash flow (23.0) (7.8)
------------------------------ ------------------------------
Of the GBP23.0m paid in the current year, GBP11.4m relates to
expenditure incurred in the prior year.
4. Segmental analysis
IFRS 8 'Operating Segments' requires operating segments to be
determined based on the Group's internal reporting to the Chief
Operating Decision Maker. The Chief Operating Decision Maker has
been determined to be the Management Committee (renamed from the
Executive Committee as part of the Group's Driving Change agenda)
which receives information on the basis of the Group's operations
in key geographical territories. Management monitors and makes
decisions considering the entire Group. The Group has reviewed its
assessment of reportable segments under IFRS 8, "Operating
Segments" and concluded that the Group continues to have one
reportable segment.
Six months to 28 February 2023 (unaudited)
UK EU US RoW(1) Total
GBPm GBPm GBPm GBPm GBPm
---------------------------- ---------------------------- -------- -------- -------- ------------
Retail sales 775.1 572.7 244.3 172.7 1,764.8
Income from other services
(2) 28.6 13.9 24.9 8.4 75.8
------------
Total revenue 803.7 586.6 269.2 181.1 1,840.6
(1,175.9)
------------
Cost of sales
---------------------------- ---------------------------- -------- -------- -------- ------------
Gross profit 664.7
Distribution expenses (229.8)
Administrative expenses (708.4)
Other income 1.0
---------------------------- ---------------------------- -------- -------- -------- ------------
Operating loss (272.5)
Finance income 2.5
Finance expense (20.9)
---------------------------- ---------------------------- -------- -------- -------- ------------
Loss before tax (290.9)
---------------------------- ---------------------------- -------- -------- -------- ------------
Non-current assets(3) 1,013.7 183.4 151.4 - 1,348.5
---------------------------- ---------------------------- -------- -------- -------- ------------
1 Rest of World.
2 Income from other services comprises of delivery receipt
payments, marketing services, commission on partner-fulfilled sales
and revenue from wholesale sales.
3 Excluding goodwill, derivative financial assets and deferred
tax assets.
Six months to 28 February 2022 (unaudited)
UK EU US RoW(1) Total
GBPm GBPm GBPm GBPm GBPm
---------------------------- -------- -------- ------- -------- ------------
Retail sales 867.2 564.1 226.0 270.1 1,927.4
Income from other services
(2) 28.3 13.3 26.7 8.4 76.7
Total revenue 895.5 577.4 252.7 278.5 2,004.1
Cost of sales (1,140.9)
---------------------------- -------- -------- ------- -------- ------------
Gross profit 863.2
Distribution expenses (255.6)
Administrative expenses (612.0)
---------------------------- -------- -------- ------- -------- ------------
Operating loss (4.4)
Finance income 0.1
Finance expense (11.5)
---------------------------- -------- -------- ------- -------- ------------
Loss before tax (15.8)
---------------------------- -------- -------- ------- -------- ------------
4. Segmental analysis continued
Six months to 28 February 2022 (unaudited)
-------------------------- ---------------------------------------------------
UK EU US RoW(1) Total
GBPm GBPm GBPm GBPm GBPm
-------------------------- ---------- -------- -------- -------- ---------
Non-current assets (as
at 28 February 2022)(3) 986.0 188.3 134.2 - 1,308.5
-------------------------- ---------- -------- -------- -------- ---------
Non-current assets (as
at 31 August 2022)(3) 1,006.7 188.8 185.2 - 1,380.7
-------------------------- ---------- -------- -------- -------- ---------
1 Rest of World
2 Income from other services comprises of delivery receipt
payments, marketing services, commission on partner-fulfilled sales
and revenue from wholesale sales
3 Excluding goodwill, derivative financial assets and deferred
tax assets.
Due to the nature of its activities, the Group is not reliant on
any individual major customers.
5. Finance income and finance costs
Six months to Six months
28 February 2023 to February
2022
(unaudited) (unaudited)
GBPm GBPm
---------------------------------------------- ------------------ -------------
Interest income on cash and cash equivalents 2.5 0.1
---------------------------------------------- ------------------ -------------
Interest on borrowings (19.1) (9.6)
Interest on lease liabilities (2.9) (2.6)
Provisions - unwinding of discount (0.6) (0.1)
Interest capitalised 1.7 0.8
------------------------------------ ------- -------
Total finance costs (20.9) (11.5)
------------------------------------ ------- -------
6. Taxation
Six months to 28 February 2023 Six months to February 2022
(unaudited) (unaudited)
GBPm GBPm
----------------------------------------------------- -------------------------------- ----------------------------
Current year UK tax - (5.3)
Current year overseas tax 0.6 -
Adjustment in respect of prior year corporation tax (2.9) (0.3)
Total current tax credit (2.3) (5.6)
Origination and reversal of temporary differences (71.1) 4.7
Adjustment in respect of prior years 0.7 (1.4)
Total deferred tax (credit)/expense (70.4) 3.3
Total income tax credit in income statement (72.7) (2.3)
----------------------------------------------------- -------------------------------- ----------------------------
Analysed as: (22.2) 3.8
Underlying tax (50.5) (6.1)
Non-underlying tax
Total income tax credit in income statement (72.7) (2.3)
----------------------------------------------------- -------------------------------- ----------------------------
Effective tax rate 25.0% 14.6%
----------------------------------------------------- -------------------------------- ----------------------------
Income tax is recognised on management's estimate of the
weighted average effective annual income tax rates for corporate
and deferred taxes expected for the full financial year, including
stock provision adjustments (refer note 3 for adjusting items) but
excluding all other adjusting items, prior year adjustments, share
based payments and derivatives, which are recognised on an actuals
basis. The estimated average annual tax rate used for the six
months to 28 February 2023 is 20.8% compared to 22.0% for the six
months to 28 February 2022.
The reported effective tax rate is 25.0% based on the reported
loss before tax of GBP290.9m. The H1 FY23 reported tax rate is
different from the full year forecast rate due to expected
disallowances in H2 FY23. The reported tax rate is above the prior
year comparative of 14.6% due to the losses carried forward at the
deferred tax rate of 25%, the ending of the super deduction on
capital allowances relief from 1 April 2023 and the fall in share
price impacting the tax on share based payments. In addition, prior
year adjustments reduced the prior period ETR by c.10%.
7. (Loss)/Earnings per Share
Basic earnings/(loss) per share is calculated by dividing the
profit/(loss) attributable to the owners of the parent company by
the weighted average number of ordinary shares in issue during the
period. Own shares held by the Employee Benefit Trust and Link
Trust are eliminated from the weighted average number of ordinary
shares.
Diluted earnings/(loss) per share is calculated by dividing the
profit/(loss) attributable to the owners of the parent company by
the weighted average number of ordinary shares in issue during the
period, adjusted for the effects of potentially dilutive ordinary
shares.
Six months Six months
to to
28 February 28 February
2023 2022
(unaudited) (unaudited)
--------------------------------------------------- -------------- -------------
Weighted average share capital
Weighted average shares in issue (no. of shares) 99,775,925 99,675,829
Weighted average effect of dilutive share options - -
(no. of shares)(1)
Weighted average effect of convertible bond - -
(no. of shares) (1)
--------------------------------------------------- -------------- -------------
Weighted average shares in issue for diluted
earnings/(loss) per share (no. of shares) 99,775,925 99,675,829
--------------------------------------------------- -------------- -------------
Losses (GBPm)
Loss attributable to owners of the parent company ( 218.2) (13.5)
Interest expense on convertible bonds(1) - -
--------------------------------------------------- -------------- -------------
Diluted loss attributable to owners of the
parent company for diluted loss per share ( 218.2) (13.5)
--------------------------------------------------- -------------- -------------
Basic loss per share (218.7p) (13.5p)
Diluted loss per share (218.7p) (13.5p)
--------------------------------------------------- -------------- -------------
(1) Dilutive shares and interest not included where their effect
is anti-dilutive.
8. Intangible assets
Six months to 28 February 2023 Six months to 28 February 2022 Year to
(unaudited) (unaudited) 31 August 2022
GBPm GBPm (audited)
GBPm
-------------------------------- -------------------------------- ------------------------------- ----------------
Net book value
At the beginning of the period 683.9 652.2 652.2
Additions 70.2 55.8 120.5
Amortisation charge (48.8) (43.7) (88.8)
Impairment charge (1.7) - -
At the end of the period 703.6 664.3 683.9
-------------------------------- ------------------------------- ----------------
Details of the impairment charges are included within note
3.
The net book value comprises:
Six months to 28 February 2023 Six months to 28 February 2022 Year to
(unaudited) (unaudited) 31 August 2022
GBPm GBPm (audited)
GBPm
--------------------------- -------------------------------- ------------------------------- ----------------
Net book value
Goodwill 35.2 35.2 35.2
Software 443.6 393.1 417.8
Customer relationships 18.2 21.2 19.7
Brands and domain names 203.8 211.5 207.6
Assets under construction 2.8 3.3 3.6
At the end of the period 703.6 664.3 683.9
-------------------------------- ------------------------------- ----------------
Goodwill is not amortised, but tested annually for impairment,
or when an indicator of impairment exists. For the purpose of
impairment testing, goodwill is monitored on an entity wide basis
at the reporting segment level as a singular cash-generating unit
(CGU), the ASOS Group CGU. The carrying value of the CGU containing
the goodwill is compared to the recoverable amount, which is the
higher of value in use and the fair value less costs to dispose. If
the recoverable amount of the cash-generating unit is less than the
carrying amount of the unit, the impairment loss is allocated first
to reduce the carrying amount of any goodwill allocated to the CGU
and then to the other assets of the unit pro-rata on the basis of
the carrying amount of each asset in the unit. Impairment losses
recognised for goodwill are not subsequently reversed.
Given the reported loss recognised during the period, an
indicator was deemed to exist. The recoverable amount of the ASOS
Group CGU was therefore determined using a value in use
calculation, using key assumptions as follows:
-- Cash flow years / assumptions: Cash flow projections for five
years, derived from the Group's latest results and financial
forecasts approved by the Board. Thereafter, a terminal value is
calculated, based on estimated long-term growth rates.
-- Pre-tax discount rate: 11.7%
-- Post-tax discount rate: 10.1%
-- Long term growth rate: 1.5%
No impairment charge in respect of goodwill has been recognised
during the period (2022: GBPnil). No reasonably possible change in
the assumptions used in the value-in-use calculations could result
in a material impairment of goodwill.
9. Property, plant and equipment
Six months to Six months to
28 February 2023 28 February 2022 Year to 31 August 2022
(unaudited) (unaudited) (audited)
GBPm GBPm GBPm
-------------------------------- ------------------- ------------------ -----------------------
Net book value
At the beginning of the period 351.7 314.0 314.0
Additions 36.8 35.1 78.3
Depreciation charge (15.4) (14.6) (30.7)
Impairment charge (5.7) (9.8) (9.9)
At the end of the period 367.4 324.7 351.7
------------------- ------------------ -----------------------
Details of the impairment charges are included in note 3.
The net book value of property, plant and equipment comprises
fixtures fittings, plant and machinery of GBP259.2 million (28
February 2022: GBP275.9m; 31 August 2022: GBP273.7m); computer
equipment of GBP13.2m (28 February 2022: GBP12.3m; 31 August 2022:
GBP15.1m) and assets under construction of GBP95.0m (28 February
2022: GBP36.5m; 31 August 2022: GBP62.9m).
At 28 February 2023, capital commitments contracted, but not
provided for by the Group, amounted to GBP156.8m (28 February 2022:
GBP166.4m; 31 August 2022: GBP206.0m).
10. Leases
Right-of-use assets
See below for the carrying amounts of right-of-use assets and
the movements during the period:
Six months Six months Year to
to 28 February to 28 February
2023 2022
(unaudited) (unaudited) 31 August
2022
GBPm GBPm (audited)
GBPm
------------------------------------------------- ---------------- ---------------- -----------
At the beginning of the period 380.3 345.2 345.2
New leases and modifications / reassessments(1) (24.1) 32.9 72.6
Impairment charge (21.5) (9.1) (9.3)
Depreciation charge (19.1) (15.4) (30.3)
Transfers to investment property(2) (12.8) - -
Disposals - - (3.4)
Exchange differences (2.9) 1.1 5.5
------------------------------------------------- ---------------- ---------------- -----------
At the end of the period 299.9 354.7 380.3
------------------------------------------------- ---------------- ---------------- -----------
(1) The Group presents additions to right-of-use assets in line
with the disclosure requirements of IFRS 16 'Leases'. In doing so,
additions to right-of-use assets above include the net impact of
new leases and modifications/reassessments. This incorporates
re-measurements of any associated dilapidation provisions.
(2) The Group now sublets unused office space within its
Leavesden property, and as disclosed in note 3, further space has
been vacated during the year with a view to ultimately sub-letting.
As a result, the related space has been assessed to meet the
definition of investment property under IAS 40 "Investment
Properties". Right-of-use assets with a net book value of GBP12.8m
have therefore been transferred from right-of-use assets to
investment property during the year. Further detail is included
within note 2.
Right of use assets comprise entirely leases for land and
buildings.
Details of impairment charges are included in note 3.
Lease Liabilities
Set out below are the carrying amounts of lease liabilities and
the movements during the period:
Six months to 28 February 2023 Six months to 28 February 2022 Year to
(unaudited) (unaudited) 31 August 2022
GBPm GBPm (audited)
GBPm
--------------------------------- -------------------------------- ------------------------------- ----------------
At the beginning of the period 380.1 328.9 328.9
New leases and modifications /
reassessments (20.5) 30.1 75.2
Payments (15.0) (16.0) (31.7)
Interest expense 2.9 2.6 5.4
Disposals - - (3.9)
Exchange differences (1.6) (0.5) 6.2
At the end of the period 345.9 345.1 380.1
--------------------------------- -------------------------------- ------------------------------- ----------------
Current 29.8 24.9 24.3
Non-current 316.1 320.2 355.8
--------------------------------- -------------------------------- ------------------------------- ----------------
Total 345.9 345.1 380.1
--------------------------------- -------------------------------- ------------------------------- ----------------
10. Leases continued
Income statement / cash flow disclosures
The following amounts are included in the Group's consolidated
financial statements in respect of its leases:
Six months Six months
to 28 February to 28 February
2023 2022
(unaudited) (unaudited)
GBPm GBPm
-------------------------------------------------------- ---------------- ----------------
Income statement
Depreciation charge for right-of-use assets (excluding
impairment) (19.1) (15.4)
Interest expense on lease liabilities (2.9) (2.6)
Expense relating to short-term leases (0.3) (0.2)
Expense relating to leases of low value assets that
are not shown above as short-term leases (0.2) (0.3)
-------------------------------------------------------- ---------------- ----------------
Cash flow
Total cash outflow for leases comprising interest
and capital payments (15.5) (16.5)
Sub-let income relating to leases under IFRS 16 0.7 0.2
-------------------------------------------------------- ---------------- ----------------
11. Trade and other payables
Six months Six months Year to
to 28 February to 28 February
2023 2022
(unaudited) (unaudited) 31 August
2022
GBPm GBPm (audited)
GBPm
------------------------------ ---------------- ---------------- -----------
Trade payables 110.7 107.8 94.0
Other payables 319.3 320.6 402.8
Accruals 307.1 411.5 401.8
Deferred revenue 81.8 56.0 54.4
Taxation and social security 18.4 31.1 40.3
837.3 927.0 993.3
------------------------------ ---------------- ---------------- -----------
Trade and other payables have been presented in more detail than
previously in order to provide more useful information to users of
the financial statements. In doing so, the allocation between some
categories has changed. Prior periods have been represented where
relevant.
12. Provisions
Dilapidations Onerous occupancy Total
GBPm GBPm GBPm
---------------------------------- -------------- ------------------ -------
At 1 September 2022 41.9 - 41.9
Recognised 0.4 17.0 17.4
Utilised - (0.1) (0.1)
Effects of movements in discount
rates (4.0) - (4.0)
Unwinding of discount 0.5 0.1 0.6
Exchange differences 0.1 - 0.1
---------------------------------- -------------- ------------------ -------
At 28 February 2023 (unaudited) 38.9 17.0 55.9
---------------------------------- -------------- ------------------ -------
Current - 1.7 1.7
Non-current 38.9 15.3 54.2
---------------------------------- -------------- ------------------ -------
At 28 February 2023 (unaudited) 38.9 17.0 55.9
---------------------------------- -------------- ------------------ -------
At 1 September 2021 43.2 - 43.2
Recognised 2.8 - 2.8
Unwinding of discount 0.1 - 0.1
Exchange differences (0.2) - (0.2)
---------------------------------- -------------- ------------------ -------
At 28 February 2022 (unaudited) 45.9 - 45.9
---------------------------------- -------------- ------------------ -------
Current - - -
Non-current 45.9 - 45.9
---------------------------------- -------------- ------------------ -------
At 28 February 2022 (unaudited) 45.9 - 45.9
---------------------------------- -------------- ------------------ -------
At 1 September 2021 43.2 - 43.2
Recognised 10.8 - 10.8
Effects of movements in discount
rates (13.2) - (13.2)
Unwinding of discount 0.2 - 0.2
Exchange differences 0.9 - 0.9
---------------------------------- -------------- ------------------ -------
At 31 August 2022 (audited) 41.9 - 41.9
---------------------------------- -------------- ------------------ -------
Current - - -
Non-current 41.9 - 41.9
---------------------------------- -------------- ------------------ -------
At 31 August 2022 (audited) 41.9 - 41.9
---------------------------------- -------------- ------------------ -------
Refer to note 3 for details of onerous occupancy provisions
recognised during the financial period.
13. Financial instruments
Financial instruments by category
Set out below are the accounting classifications of each class
of financial assets and liabilities:
Amortised Fair value Total
cost through profit (unaudited)
GBPm or loss GBPm
GBPm
---------------------------------- ---------- ---------------- -------------
As at 28 February 2023
Derivative financial assets - 34.9 34.9
Cash and cash equivalents 308.6 - 308.6
Trade and other receivables(1) 38.7 - 38.7
Derivative financial liabilities - (15.0) (15.0)
Lease liabilities (345.9) - (345.9)
Trade and other payables(2) (720.1) - (720.1)
Borrowings (740.3) - (740.3)
---------------------------------- ---------- ---------------- -------------
(1,459.0) 19.9 (1,439.1)
---------------------------------- ---------- ---------------- -------------
Amortised cost Fair value Total
GBPm through profit (unaudited)
or loss GBPm
GBPm
---------------------------------- --------------- ---------------- -------------
As at 28 February 2022
Derivative financial assets - 55.5 55.5
Cash and cash equivalents 406.7 - 406.7
Trade and other receivables(1) 68.0 - 68.0
Derivative financial liabilities - (8.3) (8.3)
Lease liabilities (345.1) - (345.1)
Trade and other payables(2) (819.2) - (819.2)
Borrowings (469.3) - (469.3)
---------------------------------- --------------- ---------------- -------------
(1,158.9) 47.2 (1,111.7)
---------------------------------- --------------- ---------------- -------------
Amortised cost Fair value Total
GBPm through profit (audited)
or loss GBPm
GBPm
---------------------------------- --------------- ---------------- -----------
As at 31 August 2022
Derivative financial assets - 68.4 68.4
Cash and cash equivalents 323.0 - 323.0
Trade and other receivables(1) 63.4 - 63.4
Derivative financial liabilities - (32.6) (32.6)
Lease liabilities (380.1) - (380.1)
Trade and other payables(2) (880.9) - (880.9)
Borrowings (475.9) - (475.9)
---------------------------------- --------------- ---------------- -----------
(1,350.5) 35.8 (1,314.7)
---------------------------------- --------------- ---------------- -----------
(1) Excludes prepayments and VAT receivables
(2) Excludes deferred income and any amounts in relation to
taxation
13. Financial instruments continued
The prior year interim balance for financial assets and
liabilities measured at amortised cost has been amended to exclude
certain assets and liabilities totalling GBP3.8m and GBP153.7m
respectively that do not meet the definition of a financial
instrument.
The Group operates internationally and is therefore exposed to
foreign currency transaction risk, primarily on sales denominated
in Euros, US dollars, Australian Dollars. The Group's policy is to
mitigate foreign currency transaction exposures where possible and
the Group uses financial instruments in the form of forward foreign
exchange contracts to hedge future highly probable foreign currency
cash flows.
These forward foreign exchange contracts are classified above as
derivative financial assets/liabilities and are classified as Level
2 financial instruments under IFRS 13, "Fair Value Measurement."
They have been fair valued at 28 February 2023 with reference to
forward exchange rates that are quoted in an active market, with
the resulting value discounted back to present value. All forward
foreign exchange contracts were assessed to be highly effective
during the financial period. All derivative financial liabilities
at 28 February 2023 mature within three years based on the related
contractual arrangements.
Carrying amount versus fair value
Set out below is a comparison of the carrying amount and the
fair value of financial instruments that are carried in the
financial statements at a value other than fair value. The fair
value of financial assets and liabilities are based on prices
available from the market on which the instruments are traded.
Where market values are not available, the fair values of financial
assets and liabilities have been calculated by discounting expected
future cash flows at prevailing interest rates. The fair values of
short-term deposits, trade receivables, payables and the revolving
credit facility are assumed to approximate to their book
values.
The fair values of cash and cash equivalents, trade receivables,
overdrafts and payables are assumed to approximate to their book
values.
Carrying amount Fair value
GBPm GBPm
------------------------ ---------------- -----------
As at 28 February 2023
Convertible bond (457.3) (347.2)
Nordstrom loan (22.0) (21.9)
(479.3) (369.1)
------------------------ ---------------- -----------
Carrying amount Fair value
GBPm GBPm
------------------------ ---------------- -----------
As at 28 February 2022
Convertible bond (444.4) (425.8)
Nordstrom loan (22.0) (21.9)
(466.4) (447.7)
------------------------ ---------------- -----------
Carrying amount Fair value
GBPm GBPm
---------------------- ---------------- -----------
As at 31 August 2022
Convertible bond (451.0) (371.7)
Nordstrom loan (22.0) (21.9)
(473.0) (393.6)
---------------------- ---------------- -----------
14. Borrowings
28 February 28 February 31 August
2023 2022 2022
(unaudited) (unaudited) (audited)
GBPm GBPm GBPm
-------------------------------------- -------------- ------------- -----------
Convertible bond (457.3) (444.4) (451.0)
Nordstrom loan (22.0) (22.0) (22.0)
Obligation to repurchase own shares (3.0) (2.9) (2.9)
Revolving credit facility (including (258.0) - -
accrued interest)
-------------------------------------- -------------- ------------- -----------
(740.3) (469.3) (475.9)
-------------------------------------- -------------- ------------- -----------
Current (9.3) (1.4) (1.4)
Non-current (731.0) (467.9) (474.5)
-------------------------------------- -------------- ------------- -----------
(740.3) (469.3) (475.9)
-------------------------------------- -------------- ------------- -----------
The convertible bond represents the liability component of
GBP500m convertible bonds issued on 16 April 2021, and pays a
coupon of 0.75% until April 2026, or the conversion date, if
earlier. The bonds are unsecured.
The Nordstrom loan attracts interest at 6.5% per annum, and was
recognised as part of a strategic partnership with Nordstrom who
purchased a minority interest in ASOS Holdings Limited in July
2021. As part of this agreement a written put option was provided
to Nordstrom over their shares in ASOS Holdings Limited.
At the balance sheet date, the Group had in place a GBP350m
Revolving Credit Facility (RCF) ( plus GBP50m ancillary facilities
following exercise of a GBP50m accordion option in December 2022) ,
of which GBP250m was drawn down (HY22 GBPnil). In May 2023 the
Group successfully negotiated an amendment and extension to the
terms of the RCF - refer to Note 18 for further information.
15. Analysis of net debt
Group net debt comprises cash and cash equivalents less any
borrowings drawn down at period-end (including accrued interest),
but excluding outstanding lease liabilities.
Lease liabilities Borrowings Cash and Net borrowings
cash equivalents
-------------------------------
GBPm GBPm GBPm GBPm
------------------------------- ------------------ ----------- ------------------ ---------------
At 1 September 2022 (380.1) (475.9) 323.0 (533.0)
------------------------------- ------------------ ----------- ------------------ ---------------
Cash flow movements 15.0 (246.9) (15.2) (247.1)
------------------------------- ------------------ ----------- ------------------ ---------------
Net cash movement - (250.0) (12.7) (262.7)
Net interest paid/(received) 2.9 3.1 (2.5) 3.5
Lease liability payments 12.1 - - 12.1
------------------------------- ------------------ ----------- ------------------ ---------------
Non-cash movements 19.2 (17.5) 0.8 2.5
------------------------------- ------------------ ----------- ------------------ ---------------
Movement in lease liabilities 20.5 - - 20.5
Foreign exchange impacts 1.6 - (1.7) (0.1)
Accrued interest (2.9) (17.5) 2.5 (17.9)
------------------------------- ------------------ ----------- ------------------ ---------------
At 28 February 2023 (345.9) (740.3) 308.6 (777.6)
------------------------------- ------------------ ----------- ------------------ ---------------
Net debt (excluding
leases) (431.7)
------------------------------- ------------------ ----------- ------------------ ---------------
At 1 September 2021 (328.9) (463.2) 662.7 (129.4)
------------------------------- ------------------ ----------- ------------------ ---------------
Cash flow movements 16.0 2.9 (256.6) (237.7)
------------------------------- ------------------ ----------- ------------------ ---------------
Net cash movement - - (256.5) (256.5)
Net interest paid/(received) 2.6 2.9 (0.1) 5.4
Lease liability payments 13.4 - - 13.4
------------------------------- ------------------ ----------- ------------------ ---------------
Non-cash movements (32.2) (9.0) 0.6 (40.6)
------------------------------- ------------------ ----------- ------------------ ---------------
Movement in lease liabilities (30.1) - - (30.1)
Foreign exchange impacts 0.5 - 0.5 1.0
Accrued interest (2.6) (9.0) 0.1 (11.5)
------------------------------- ------------------ ----------- ------------------ ---------------
At 28 February 2022 (345.1) (469.3) 406.7 (407.7)
------------------------------- ------------------ ----------- ------------------ ---------------
Net debt (excluding
leases) (62.6)
------------------------------- ------------------ ----------- ------------------ ---------------
At 1 September 2021 (328.9) (463.2) 662.7 (129.4)
------------------------------- ------------------ ----------- ------------------ ---------------
Cash flow movements 31.7 5.7 (340.7) (303.3)
------------------------------- ------------------ ----------- ------------------ ---------------
Net cash movement - - (339.8) (339.8)
Net interest paid/(received) 5.4 5.7 (0.9) 10.2
Lease liability payments 26.3 - - 26.3
------------------------------- ------------------ ----------- ------------------ ---------------
Non-cash movements (82.9) (18.4) 1.0 (100.3)
------------------------------- ------------------ ----------- ------------------ ---------------
Movement in lease liabilities (71.3) - - (71.3)
Foreign exchange impacts (6.2) - 0.1 (6.1)
Accrued interest (5.4) (18.4) 0.9 (22.9)
------------------------------- ------------------ ----------- ------------------ ---------------
At 31 August 2022 (380.1) (475.9) 323.0 (533.0)
------------------------------- ------------------ ----------- ------------------ ---------------
Net debt (excluding
leases) (152.9)
------------------------------- ------------------ ----------- ------------------ ---------------
The cash and cash equivalents balance includes uncleared payment
provider receipts of GBP44.6m (31 August 2022: GBP32.3m and 28
February 2022: GBP36.0m) that are generally receivable within 72
hours.
15. Analysis of net debt continued
Included within cash and cash equivalents is GBP1.7m (28
February 2022: GBPnil; 31 August 2022: GBP0.8m) of cash collected
on behalf of partners of the Direct to Consumer fulfilment
proposition 'Partner Fulfils'. ASOS Payments Limited and the Group
are entitled to interest amounts earned on the deposits. Amounts
are held in a segregated bank account and are settled on a monthly
basis.
16. Related parties
The Group's related party transactions are with the Employee
Benefit Trust, Link Trust, key management personnel and other
related parties as disclosed in the Group's Annual Report and
Accounts for the year to 31 August 2022.
Transactions with other related parties
During the period, the Group made purchases of inventory, net of
VAT, totalling GBP38.9m (six months to 28 February 2022: GBP39.8m)
from Aktieselskabet af 5.5.2010, a company which has a significant
shareholding in the Group. At 28 February 2023, the amount due to
Aktieselskabet af 5.5.2010 was GBP8.1m (28 February 2022: GBP5.8m).
In addition, a rebate GBP0.1m (28 February 2022: GBP0.2m) was
received during the period from Aktieselskabet af.
There have been no other material changes to the Group's related
party transactions during the six months to 28 February 2023.
17. Contingent liabilities
From time to time, the Group is subject to various legal
proceedings and claims that arise in the ordinary course of
business, which due to the fast-growing nature of the Group and its
e-commerce base, may concern the Group's brand and trading name or
its product designs. All such cases brought against the Group are
robustly defended and a liability is recorded only when it is
probable that the case will result in a future economic outflow
which can be reliably measured.
At 28 February 2023, the Group had contingent liabilities of
GBPnil (28 February 2022: GBPnil).
18. Post balance sheet events
Post the balance sheet date, the Group successfully amended and
extended its existing GBP350m Revolving Credit Facility (plus
GBP50m ancillary facilities following exercise of a GBP50m
accordion option in December 2022) to November 2024. The facility
continues to have minimum liquidity, leverage and interest cover
covenants and is subject to a floating and fixed charge over
certain group assets. The minimum liquidity covenant will continue
to apply for the duration of the facility, with the interest cover
and leverage covenants being applicable from 31st August 2023. The
facility steps down over the term, reducing to GBP220m by August
2024. The RCF extension secures the Company's funding beyond FY24,
supporting the business as it continues to execute on its Driving
Change agenda and return to profitability and cash generation. As a
result of the extension our current expectation of H2 FY23 interest
expenses is c.GBP30m including amortisation of arrangement fees and
related costs.
Principal risks and uncertainties
The Board have concluded that the principal risks and
uncertainties which could impact the Group over the remaining six
months of the financial year to 31 August 2023 remain relatively
unchanged from those set out in the Annual Report and Accounts for
the year to 31 August 2022. The applicable risks are summarised as
follows:
-- Data breach
-- Cyber security incidents
-- Availability of technology services
-- Macro-economic changes, including Russia/Ukraine conflict
-- Foreign exchange rate exposure
-- Supply Chain disruption
-- E-commerce market dynamics and impact on our business
-- Ethical trade issues in our supply chain
-- Failure to comply with legislation or regulation
-- Sustainability & climate change
-- Engagement, capability & retention of talent
-- Transformation fails to delivery required outcome
These are set out in detail on pages 48 to 53 of the Group's
Annual Report and Accounts for the year to 31 August 2022, a copy
of which is available on the Group's website, www.asosplc.com.
Statement of Directors' responsibilities
The Directors confirm that this set of Condensed Consolidated
Interim Financial Statements has been prepared in accordance with
UK adopted IAS 34 'Interim Financial Reporting' and the Disclosure
and Transparency Rules of the UK's Financial Conduct Authority, and
that the Interim Management Report herein includes a true and fair
review of the information required by DTR 4.2.7R and DTR 4.2.8R,
namely:
-- that the report contains a fair review of important events
that have occurred during the first 28 weeks of the financial year,
and their impact on the condensed set of financial statements, and
of the principal risks and uncertainties for the remaining six
months of the financial year; and
-- that the report contains a fair review of related party transactions.
The Directors of ASOS plc are listed on the Group's website:
https://www.asosplc.com/this-is-asos/our-leadership/board-directors/
By order of the Board
José Antonio Ramos Calamonte
Chief Executive Officer
INDEPENT REVIEW REPORT TO ASOS PLC
REPORT ON THE CONDENSED CONSOLIDATED INTERIM FINANCIAL
STATEMENTS
Our conclusion
We have reviewed ASOS Plc's condensed consolidated interim
financial statements (the "interim financial statements") in the
interim results of ASOS Plc for the 6 month period ended 28
February 2023 (the "period").
Based on our review, nothing has come to our attention that
causes us to believe that the interim financial statements are not
prepared, in all material respects, in accordance with UK adopted
International Accounting Standard 34, 'Interim Financial Reporting'
and the Disclosure Guidance and Transparency Rules sourcebook of
the United Kingdom's Financial Conduct Authority.
The interim financial statements comprise:
-- the consolidated balance sheet (unaudited) as at 28 February 2023;
-- the consolidated income statement (unaudited) for the period then ended;
-- the consolidated statement of total comprehensive (loss) /
income (unaudited) for the period then ended;
-- the consolidated cash flow statement (unaudited) for the period then ended;
-- the consolidated statement of changes in equity (unaudited) for the period then ended; and
-- the explanatory notes to the interim financial statements.
The interim financial statements included in the interim results
of ASOS Plc have been prepared in accordance with UK adopted
International Accounting Standard 34, 'Interim Financial Reporting'
and the Disclosure Guidance and Transparency Rules sourcebook of
the United Kingdom's Financial Conduct Authority.
Basis for conclusion
We conducted our review in accordance with International
Standard on Review Engagements (UK) 2410, 'Review of Interim
Financial Information Performed by the Independent Auditor of the
Entity' issued by the Financial Reporting Council for use in the
United Kingdom ("ISRE (UK) 2410"). A review of interim financial
information consists of making enquiries, primarily of persons
responsible for financial and accounting matters, and applying
analytical and other review procedures.
A review is substantially less in scope than an audit conducted
in accordance with International Standards on Auditing (UK) and,
consequently, does not enable us to obtain assurance that we would
become aware of all significant matters that might be identified in
an audit. Accordingly, we do not express an audit opinion.
We have read the other information contained in the interim
results and considered whether it contains any apparent
misstatements or material inconsistencies with the information in
the interim financial statements.
Conclusions relating to going concern
Based on our review procedures, which are less extensive than
those performed in an audit as described in the Basis for
conclusion section of this report, nothing has come to our
attention to suggest that the directors have inappropriately
adopted the going concern basis of accounting or that the directors
have identified material uncertainties relating to going concern
that are not appropriately disclosed. This conclusion is based on
the review procedures performed in accordance with ISRE (UK) 2410.
However, future events or conditions may cause the group to cease
to continue as a going concern.
Responsibilities for the interim financial statements and the
review
Our responsibilities and those of the directors
The interim results, including the interim financial statements,
is the responsibility of, and has been approved by the directors.
The directors are responsible for preparing the interim results in
accordance with the Disclosure Guidance and Transparency Rules
sourcebook of the United Kingdom's Financial Conduct Authority. In
preparing the interim results, including the interim financial
statements, the directors are responsible for assessing the group's
ability to continue as a going concern, disclosing, as applicable,
matters related to going concern and using the going concern basis
of accounting unless the directors either intend to liquidate the
group or to cease operations, or have no realistic alternative but
to do so.
INDEPENT REVIEW REPORT TO ASOS PLC CONTINUED
Our responsibility is to express a conclusion on the interim
financial statements in the interim results based on our review.
Our conclusion, including our Conclusions relating to going
concern, is based on procedures that are less extensive than audit
procedures, as described in the Basis for conclusion paragraph of
this report. This report, including the conclusion, has been
prepared for and only for the company for the purpose of complying
with the Disclosure Guidance and Transparency Rules sourcebook of
the United Kingdom's Financial Conduct Authority and for no other
purpose. We do not, in giving this conclusion, accept or assume
responsibility for any other purpose or to any other person to whom
this report is shown or into whose hands it may come save where
expressly agreed by our prior consent in writing.
PricewaterhouseCoopers LLP
Chartered Accountants
London
10 May 2023
Alternative performance measures (APMs)
The Group uses the below non-IFRS performance measures to allow
shareholders to better understand underlying financial performance
and position. These should not be seen as substitutes for IFRS
measures of performance and may not allow a direct comparison to
other companies.
Performance Closest Definition How ASOS uses this measure
measure IFRS measure
-------------- -------------- ------------------------- -----------------------------------------------------------
Revenue None ASOS calculates This measure is presented as a means
growth constant currency of eliminating the effects of exchange
at constant (CCY) growth by rate fluctuations on the period-on-period
currency adjusting the current reported results.
year reported revenue Six months Six months % growth
number for the impact to 28 to 28
of year-on-year February February
changes in the hedge 2023 2022
rate on hedged sales GBPm GBPm %
and year-on-year -------------------- ----------- ----------- ---------
spot rate movements Revenue at
on unhedged sales. constant currency 1,794.6 2,004.1 (10%)
This provides revenue Impact of 46.0 - -
growth on a foreign exchange
like-for-like translation
basis vs. last year, -------------------- ----------- ----------- ---------
giving users of Group revenue 1,840.6 2,004.1 (8%)
the accounts a better -------------------- ----------- ----------- ---------
view of underlying
sales performance Six months Six months % growth
that is not impacted to 28 to 28
by exchange rate February February
fluctuations. 2022 2021
GBPm GBPm %
-------------------- ----------- ----------- ---------
Revenue at
constant currency 2,045.9 1,975.9 4%
Impact of (41.8) - -
foreign exchange
translation
-------------------- ----------- ----------- ---------
Group revenue 2,004.1 1,975.9 1%
-------------------- ----------- ----------- ---------
-------------- -------------- ------------------------- -----------------------------------------------------------
Retail Revenue Internet sales recorded A measure of the Group's trading performance
sales net of an appropriate focusing on the sale of products to
deduction for actual end customers. Used by management
and expected returns, to monitor overall performance across
relevant vouchers, markets, and the basis of key internal
discounts and sales KPIs such as ABV.
taxes.
A reconciliation of this measure is
Retail sales exclude included in note 4.
income from delivery
receipt payments,
marketing services,
commission on
partner-fulfilled
sales and revenue
from wholesale sales
-------------- -------------- ------------------------- -----------------------------------------------------------
Adjusted Revenue Revenue excluding A measure of the Group's revenue and
revenue the impact of adjusting gross profitability, excluding the
items. impact of any adjusting items.
Reconciliation is shown below:
-------------- -------------- -------------------------
Adjusted None Gross profit divided Six months Six months
gross margin by revenue and excluding to 28 February to 28 February
the impact of adjusting 2023 2022
items. GBPm GBPm
------------------ ---------------- ----------------
Revenue 1,840.6 2,004.1
Adjusting items (2.1) -
------------------ ---------------- ----------------
Adjusted revenue 1,838.5 2,004.1
------------------ ---------------- ----------------
Gross profit 664.7 863.2
Adjusting items 124.6 -
------------------ ---------------- ----------------
Adjusted gross
profit 789.3 863.2
------------------ ---------------- ----------------
Adjusted gross
margin % 42.9% 43.1%
------------------ ---------------- ----------------
-------------- -------------- ------------------------- -----------------------------------------------------------
Alternative performance measures (APMs) continued
Performance Closest Definition How ASOS uses this measure
measure IFRS measure
-------------- -------------- ------------------- -------------------------------------------------------------------
Adjusted Operating Profit before tax, A measure of the Group's underlying
EBIT (loss)/profit interest, and any profitability for the period, excluding
adjusting items the impact of any transactions outside
excluded from of the ordinary course of business
adjusted and not considered to be part of ASOS'
profit before tax usual cost base. Used by management
(see below). to monitor the performance of the
business each month.
Six Six months
months to 28
to 28 February
February 2022
2023
GBPm GBPm
---------------------------- ---------- -----------
Operating loss (272.5) (4.4)
Adjusting items excluding
finance costs (note
3) 203.1 30.6
Adjusted EBIT (69.4) 26.2
---------------------------- ---------- -----------
Net finance costs (note
5) (18.4) (11.4)
Add back adjusting finance
costs (note 3) 0.4 -
Adjusted (loss)/profit
before tax (87.4) 14.8
---------------------------- ---------- -----------
Group revenue 1,840.6 2,004.1
Adjusting items (2.1) -
---------------------------- ---------- -----------
Adjusted Group revenue 1,838.5 2,004.1
---------------------------- ---------- -----------
Adjusted EBIT margin (3.8%) 1.3%
---------------------------- ---------- -----------
Details of adjusting items are included
within note 3.
-------------- -------------- ------------------- -------------------------------------------------------------------
Adjusted (Loss)/profit Adjusted
(loss)/profit before (loss)/profit
before tax before tax
tax excludes
items recognised
in reported profit
or loss before tax
which, if
included,
could distort
comparability
between periods.
In determining
which
items to exclude,
the Group
considers
items which are
significant either
by virtue of their
size and/or
nature,
or that are
non-recurring.
-------------- -------------- ------------------- -------------------------------------------------------------------
Net No direct Cash and cash A measure of the Group's liquidity.
cash/(debt) equivalent equivalents
less the carrying Information is included in note 15.
value of A reconciliation is included below:
borrowings Six months Six months
(including accrued to 28 February to 28 February
interest) drawn 2023 2022 (unaudited)
down at (unaudited) GBPm
period-end, GBPm
but excluding --------------------------- ---------------- ------------------
outstanding Cash and cash equivalents 308.6 406.7
lease liabilities. Borrowings (740.3) (469.3)
Lease liabilities (345.9) (345.1)
--------------------------- ---------------- ------------------
(407.7
Net borrowings (777.6) )
Add-back lease
liabilities 345.9 345.1
--------------------------- ---------------- ------------------
Group net debt (431.7) (62.6)
--------------------------- ---------------- ------------------
-------------- -------------- ------------------- -------------------------------------------------------------------
Free cash No direct Free cash flow is A measure of the cash generated by
flow equivalent net cash generated the Group outside cash flows relating
from operating to M&A and financing transactions,
activities, which allows management to better
adjusted for assess the cash being generated by
payments the business.
to acquire
intangible A reconciliation to the Group cash
and tangible flow is shown below:
assets, Six Six months
the payment of the months to 28
principal portion to 28 February
of lease February 2022
liabilities, 2023
net finance GBPm GBPm
expenses ------------------------------- ---------- -----------
and fees in Cash used in operations
relation (per cash flow) (128.2) (151.2)
to any financing Purchase of tangible
transactions and intangible assets (115.0) (86.5)
carried Repayment of principal
out by the Group portion of lease liabilities (12.1) (13.4)
where relevant. Net interest paid (3.5) (5.4)
Refinancing amendment
fees (3.9) -
Free cash flow (262.7) (256.5)
------------------------------- ---------- -----------
-------------- -------------- ------------------- -------------------------------------------------------------------
Appendix 1 - Total sales growth by period in sterling, including
Russia
Year ending 31 August 2023
2022/23
GBPm P1(1) YOY% P2(1) YOY% P3(1) YOY% P4(1) YOY% YTD YOY%
------- ----- ----- ----- --------
UK total sales 591.3 (8%) 212.4 (15%) 803.7 (10%)
EU total sales 417.3 7% 169.3 (10%) 586.6 2%
US total sales 198.1 15% 71.1 (11%) 269.2 7%
ROW total sales 129.8 (30%) 51.3 (45%) 181.1 (35%)
Total sales
(3) 1,336.5 (4%) 504.1 (17%) 1,840.6 (8%)
------- ----- ----- ----- --------
Year ended 31 August 2022
GBPm P1(1) YOY% P2(1) YOY% P3(1) YOY% P4(1) YOY% 2021/22 YOY%
------- ----- ------- ----- --------
UK total sales 645.2 13% 250.3 (2%) 431.8 4% 435.5 6% 1,762.8 7%
EU total sales 390.2 (3%) 187.2 (3%) 294.0 (5%) 298.6 6% 1,170.0 (1%)
US total sales 172.6 7% 80.1 13% 141.9 21% 136.8 18% 531.4 14%
ROW total sales 185.1 (20%) 93.4 1% 96.4(2) (33%) 97.4 (30%) 472.3 (22%)
964.1
Total sales (3) 1,393.1 2% 611.0 -% (2) (2%) 968.3 2% 3,936.5 1%
------- ----- ------- ----- --------
Year ended 31 August 2021
GBPm P1(1) YOY% P2(1) YOY% P3(1,4) YOY% P4(1,4) YOY% 2020/21 YOY%
------- ----- ------- ------- --------
UK total sales 571.3 35% 254.5 46% 415.9 85% 410.3 5% 1,652.0 36%
EU total sales 400.6 18% 193.8 22% 310.1 33% 280.8 (6%) 1,185.3 15%
US total sales 161.7 12% 71.2 8% 117.5 25% 115.8 4% 466.2 12%
ROW total sales 230.5 16% 92.3 1% 144.5 2% 139.7 (19%) 607.0 1%
Total sales(3) 1,364.1 23% 611.8 25% 988.0 43% 946.6 (3%) 3,910.5 20%
------- ----- ------- ------- --------
(1) Periods are as follows:
P1: four months to 31 December
P2: two months to 28/29 February
P3: three months to 31 May
P4: three months to 31 August
(2) In the tables above RoW and Group total sales for P3 have
been restated. This restatement relates to the removal of the
GBP19.3m gain on RUB hedges, which was reported as revenue at P3
but subsequently reallocated to other income at year-end 2022.
(3) Includes retail sales, wholesale and income from other
services comprising delivery receipt payments, marketing services
and commission on partner-fulfilled sales
(4) P3 is restated to reflect only March, April, and May. P4 has
been restated to include June.
Appendix 2 - Total sales growth by period at constant currency,
including Russia
Year ending 31 August 2023
P1 (1) P2 (1) P3 (1) P4 (1) 2022/23
GBPm YOY% YOY% YOY% YOY% YOY%
UK total sales (8%) (15%) (10%)
EU total sales 6% (12%) -%
US total sales (2%) (20%) (7%)
ROW total sales (31%) (46%) (36%)
Total sales(3) (6%) (20%) (10%)
Year ended 31 August 2022
P1 (1) P2 (1) P3 (1) P4 (1) 2021/22
GBPm YOY% YOY% YOY% YOY% YOY%
UK total sales 13% (2%) 4% 6% 7%
EU total sales 2% 1% (2%) 9% 2 %
US total sales 11% 12% 15% 4% 10 %
ROW total sales (15%) 2% (33%)(2) (31%) (20%)
Total sales(3) 5% 1% (2%) (2) 1% 2%
Year ended 31 August 2021
P1 (1) P2 (1) P3 (1,4) P4 (1,4) 2020/21
GBPm YOY% YOY% YOY% YOY% YOY%
UK total sales 35% 46% 85% 5% 36%
EU total sales 17% 20% 34% (7%) 15%
US total sales 16% 13% 40% 15% 21%
ROW total sales 20% 9% 10% (14%) 6%
Total sales(3) 24% 26% 47% (1%) 22%
(1) Periods are as follows:
P1: four months to 31 December
P2: two months to 28/29 February
P3: three months to 31 May
P4: three months to 31 August
(2) In the tables above RoW and Group total sales for P3 have
been restated. This restatement relates to the removal of the
GBP19.3m gain on RUB hedges, which was reported as revenue at P3
but subsequently reallocated to other income at year-end 2022.
(3) Includes retail sales, wholesale and income from other
services comprising delivery receipt payments, marketing services
and commission on partner-fulfilled sales
(4) P3 is restated to reflect only March, April, and May. P4 has
been restated to include June.
Appendix 3
Total sales growth by period in sterling, excluding Russia
Year ending 31 August 2023
2022/23
GBPm P1(1) YOY% P2(1) YOY% P3(1) YOY% P4(1) YOY% YTD YOY%
------- ----- ----- ----- --------
UK total sales 591.3 (8%) 212.4 (15%) 803.7 (10%)
EU total sales 417.3 7% 169.3 (10%) 586.6 2%
US total sales 198.1 15% 71.1 (11%) 269.2 7%
ROW total sales 129.8 (9%) 51.3 (14%) 181.1 (10%)
Total sales
(3) 1,336.5 (1%) 504.1 (13%) 1,840.6 (5%)
------- ----- ----- ----- --------
Year ended 31 August 2022
GBPm P1(1) YOY% P2(1) YOY% P3(1) YOY% P4(1) YOY% 2021/22 YOY%
------- ----- ------- ----- --------
UK total sales 645.2 13% 250.3 (2%) 431.8 4% 435.5 6% 1,762.8 7%
EU total sales 390.2 (3%) 187.2 (3%) 294.0 (5%) 298.6 6% 1,170.0 (1%)
US total sales 172.6 7% 80.1 13% 141.9 21% 136.8 18% 531.4 14%
ROW total sales 142.0 59.7 96.4(2) (7%) 97.4 (3%) 395.5
Total sales 964.1
(3) 1,350.0 577.3 (2) 2% 968.3 7% 3,859.7
------- ----- ------- ----- --------
Total sales growth by period at constant currency, excluding
Russia
Year ending 31 August 2023
P1 (1) P2 (1) P3 (1) P4 (1) 2022/23
GBPm YOY% YOY% YOY% YOY% YOY%
UK total sales (8%) (15%) (10%)
EU total sales 6% (12%) -%
US total sales (2%) (20%) (7%)
ROW total sales (10%) (16%) (12%)
Total sales(3) (3%) (15%) (7%)
Year ended 31 August 2022
P1 (1) P2 (1) P3 (1) P4 (1) 2021/22
GBPm YOY% YOY% YOY% YOY% YOY%
UK total sales 13% (2%) 4% 6% 7%
EU total sales 2% 1% (2%) 9% 2 %
US total sales 11% 12% 15% 4% 10 %
ROW total sales (7%)(2) (4%)
Total sales(3) 2% (2) 6%
(1) Periods are as follows:
P1: four months to 31 December
P2: two months to 28/29 February
P3: three months to 31 May
P4: three months to 31 August
(2) In the tables above RoW and Group total sales for P3 have
been restated. This restatement relates to the removal of the
GBP19.3m gain on RUB hedges, which was reported as revenue at P3
but subsequently reallocated to other income at year-end 2022.
(3) Includes retail sales, wholesale and income from other
services comprising delivery receipt payments, marketing services
and commission on partner-fulfilled sales
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