RNS Number:7065O
ASOS PLC
11 July 2005
FOR RELEASE
7.00 am
Monday 11 July 2005
ASOS plc
" ASOS" or "Group"
("A leading Internet based fashion retailer")
RECORD RESULTS
Highlights
12 months to 31st March 2005 vs. unaudited pro forma accounts for 12 months to
March 2004*
*Group sales +79% to #13.5m
*Group profit before tax and amortisation of goodwill +77% to #1.1m
*Group profit after amortisation of goodwill and before tax +240% to #0.9m
*Cash at bank +105% to #2.1m
*Fully diluted EPS before tax and goodwill amortisation +67% to 1.5p
*ASOS.com registered users + 58% to 600,000 (as at 4th July 2005)
*1st quarter sales tracking over 100% year on year
*Quieter summer, warehouse move and all important Christmas period still
to come
*Confident of another strong year
* In 2004, the Group's year end was changed resulting in a 15 month audited set
of accounts
ASOS plc
Nick Robertson, Chief Executive Tel: 020 7240 7070
Jon Kamaluddin, Finance Director
www.asos.com
Beattie Financial
Brian Coleman-Smith / Jo Clewlow / Nia Thomas Tel: 020 7053 6400
Seymour Pierce
Mark Percy / Ewan Leggat Tel: 020 7107 8000
ASOS plc is an Internet Retail and Marketing Services Group, established in June
2000 and admitted to AIM in October 2001. Its principal business is ASOS.com, a
leading online fashion and beauty retailer. Aimed primarily at an Internet savvy
18-34 year old, ASOS has over 600,000 registered customers at 4 July 2005, and
offers over 1800 lines across womenswear, menswear, jewellery, beauty,
accessories and footwear.
ASOS PLC
Chief executive's statement
for the YEAR ended 31 MARCH 2005
Summary
We continue to make significant strides in establishing ASOS as the UK's premier
online fashion retailer.
The strategy of broadening the product offer has paid off. We currently sell
around 1800 lines, up from 500 a year ago and we add 100 to 150 new lines per
week. We are consistently the second most visited online fashion store in the UK
behind Next (source: Hitwise). In March 2005, ASOS.com attracted over one
million unique visitors for the first time.
There remains considerable opportunity for ASOS in the UK and we are on track to
deliver another strong year of growth.
Highlights
12 months to 31st March 2005 vs. unaudited pro forma accounts for 12 months to
March 2004*
*Group sales +79% to #13.5m
*Group profit before tax and amortisation of goodwill +77% to #1.1m
*Group profit after amortisation of goodwill and before tax +240% to #0.9m
*Cash at bank +105% to #2.1m
*Fully diluted EPS before tax and goodwill amortisation +67% to 1.5p
*ASOS.com registered users + 58% to 600,000 (as at 4th July 2005)
*1st quarter sales tracking over 100% year on year
*Quieter summer, warehouse move and all important Christmas period still
to come
*Confident of another strong year
* In 2004, the Group's year end was changed resulting in a 15 month audited set
of accounts
New department performances
Through the course of the year we extended the product offer to include four new
departments namely; footwear, jewellery, beauty and accessories. I am pleased to
report that all new departments made a valuable contribution to the business.
The latest figures for June show womenswear continuing to dominate with 60% of
sales and the remaining 40% split as follows: female footwear 12%, female
accessories 6%, jewellery 5%, beauty products 3% and menswear held ground at
14%.
Stock levels
We ended the year with #1.6m of stock compared to #0.5m at the same stage last
year. We peaked at #1.9m in the run up to Christmas. Since the 31st March 2005,
we have reduced this to approximately #1.1m equating to 4.4 weeks of forward
cover. At these levels, the space issues we experienced at Christmas have not
been repeated.
Gross margin
The effect of the warehouse space issue over Christmas, and the subsequent
higher than budgeted discounting of winter stock, was a 1.5% drop in gross
margin for ASOS.com for the year to 45.9% from 47.4%. We have since recovered
this loss and expect to achieve a gross margin for the current financial year of
at least 48%.
Returns
The average returns rate for the business is 20%. The rate is slightly higher
for womenswear but lower for menswear, beauty and jewellery. We anticipate a
similar level of returns for the year to March 2006.
Basket value and average units per basket
Both indices improved over the course of the year. On average, our customers
placed 2.4 items into their basket, up from 1.7 the previous year. They are now
spending on average, #45 (#37 ex VAT) per basket, up from #38 (#32 ex VAT).
Approximately 4-5% of customers who visit ASOS make a purchase.
Marketing
Since Christmas we have invested considerable time updating both the web site
and all visual communication associated with ASOS. The results have been very
positive.
The single biggest sales generator is our e-mail which we now send to 500,000
female customers twice a week and 100,000 male customers once a week. This is
effectively 'free' marketing and its success has enabled us to reduce our
investment in more traditional forms of paid-for marketing such as magazines.
In addition, we completely overhauled our online affiliate programme in May
2005, reducing the cookie period (the time between a referred customer visiting
ASOS and ASOS paying a commission on a sale) to 7 days from 60 days and fixing
the majority of commissions at 10%. We also terminated all affiliate partners
who were deemed to be misrepresenting ASOS or ASOS products.
3rd Party Revenues
As the popularity of ASOS grows and traffic levels to the site increase, we are
able to generate additional revenue for banner advertising and database sales.
In the year to March 2005 we generated #229,000 this way. We expect this to rise
to approximately #300,000 for the year to March 2006.
International
International sales equated to 6.7% of our online sales, up from 6.4% from the
pervious period. No attempt was made to increase our International business over
the year as management focused its energies on growing UK market share and
sales. An opportunity still exists for ASOS products to be represented on Amazon
.com, subject to some minor technical work and a decision will be made shortly
as to whether or not we take up the opportunity this year.
Logistics
The move to our new 70,000 square feet logistics centre is on track for the last
week in July / first week in August 2005. Consolidating our logistics under one
roof will enable us to operate with far greater degrees of efficiency.
IT
Behind the scenes, we have been upgrading our back office system to accommodate
the increased site traffic and order volumes.
The online market
In stark contrast to the high street, online retail sales continue to race
ahead. The latest figures from the IMRG Index reported a 35.6% year on year
increase for May 2005, equating to #1.5billion spent online during the month.
The contributory factors appear to be the rapid take-up of broadband and
generally better online shopping services and delivery solutions, inspiring
greater confidence in online shopping.
Our customers are putting more items in their baskets and spending more per
order. There is also no shortage of new customers experiencing ASOS for the
first time.
Entertainment Marketing UK Ltd (EM)
I am pleased to report that sales in our marketing subsidiary turned the corner.
In the 12 months to 31 March 2005, we achieved sales of #744,232 compared to
sales of #657,281 for the 15 months to 31 March 2004. We remain committed to
developing the business and will continue to expand its range of services and
resource accordingly.
Our people
On behalf of the board I would like to thank all our team for their commitment
and dedication over the year. I would like to offer a special thank you to our
colleagues in Amersham who, under very testing circumstances, have kept the
orders going out the door and our customers happy.
I am pleased to report that Greg Conway, the former UK Managing Director of
Textured Jersey Limited, has today been appointed as an Executive Director with
specific responsibility for the supply chain.
Nicky Wilkins has today stepped down from the Board. Nicky has agreed to stay
with us for the next six months, which will see us through the Christmas period
and ensure a smooth handover. I would like to thank her for her contribution to
the continuing success of ASOS.
Current trading & prospects
We have had a good start to the new financial year and sales are currently
tracking at over 100% year on year. With the traditionally quieter Summer period
nearly on us, and the all important Christmas trading period yet to come, this
sales comparison should not necessarily be taken as an indication of the outcome
for the full year.
Overall, I believe the prospects for the Group are good and I am confident that
2005/6 will be another strong year.
Nick Robertson
Chief Executive
11th July 2005
FINANCE DIRECTOR'S REVIEW
for the YEAR ended 31 MARCH 2005
Results
As noted in the Chief Executive's statement, the Group has had another strong
year and turnover rose to #13.518m. Of this, #12.773m is attributable to ASOS
.com Limited and #0.744m to Entertainment Marketing (UK) Limited.
The resulting profit before tax and amortisation of goodwill for the Group was
#1.107m, which gave a fully diluted earnings per share of 1.5p.
Following a review of procedures at the end of 2002, the Board decided to change
its accounting period to 31 March. This gave rise to a 15 month audited set of
accounts for the comparative period 1 January 2003 to 31 March 2004. In order to
make a meaningful comparison a summary of the audited results for the year to 31
March 2005 is shown below, against the unaudited proforma results for the 12
months to 31 March 2004.
Audited Unaudited Year on Year
uplift
12 months Proforma
31 March 12 months
2005 31 March
2004
Group Sales #13.518m #7.541m 79%
ASOS Sales #12.773m #7.004m 82%
Group Profit before tax #1.107m #0.625m 77%
(exc Goodwill Amortisation)
Group Profit before tax #0.878m #0.258m 240%
Fully diluted EPS 1.5p 0.9p 67%
(before tax and Goodwill Amortisation)
Dividends
Inspite of two years of profitable trading the parent company still has retained
losses and as such a dividend cannot be paid for the year to 31 March 2005. The
Board will actively consider future dividend payments.
Taxation
Deferred tax assets of #0.270m (2004: #0.270m) have been recognised as the
directors believe this amount is likely to be recovered in the foreseeable
future. This asset arises from the availability of trading losses. This asset
will be recovered when sufficient trading profits have been generated to utilise
the trading losses.
The Group has tax losses of #2.750m (2004: #1.944m) which are available for
offset against future taxable profits.
Cashflow and Balance Sheet
The Group was strongly cash generative for the 12 month period generating a
#1.163m net cash inflow from operating activities (15 month period to 31 March
2004: cash inflow #1.084m).
Capital expenditure for the period was #0.299m (2004: #0.121m). This was
predominantly invested in computer hardware to support the continued growth in
traffic to the website, the development of new software for use in-house and in
preparations for ASOS.com's warehouse move.
During the period share options under the Group's EMI Approved Share Option
scheme were exercised raising #0.152m.
As a result of a total cash inflow of #1.055m for the period, the Group had a
cash balance of #2.060m as at 31 March 2005 (2004: #1.004m). Surplus funds have
been placed on time deposit with a AAA rated bank in accordance with the Group's
low risk investment policy. Interest receivable during the year amounted to
#38,799.
The Group continues to be cash generative in the current financial year and we
are confident that we will continue to generate cash from operating activities.
Net current assets increased to #2.036m at the year end (31 March 2004:
#0.988m).
Jon Kamaluddin
Finance Director
11th July 2005
ASOS PLC
Consolidated Profit And Loss Account
for the YEAR ended 31 MARCH 2005
Year ended Proforma 15 Months ended
Unaudited 12
Month period
ended
31 March 2005 31 March 2004 31 March 2004
# # #
TURNOVER 13,517,676 7,540,618 8,956,332
Cost of sales (6,927,613) (3,710,709) (4,444,760)
--------- --------- ---------
GROSS PROFIT 6,590,063 3,829,909 4,511,572
Admin expenses (5,522,150) (3,207,863) (3,967,031)
Amortisation
of goodwill (228,334) (228,334) (285,418)
--------- --------- ---------
OPERATING
PROFIT 839,579 393,712 259,123
Interest
receivable/payable 38,653 3,126 (918)
--------- --------- ---------
PROFIT ON
ORDINARY
ACTIVITIES
BEFORE
TAXATION 878,232 396,838 258,205
Tax on profit
on ordinary
activities - 270,000 270,000
PROFIT FOR THE FINANCIAL
--------- --------- ---------
PERIOD 878,232 666,838 528,205
--------- --------- ---------
EARNINGS PER SHARE
Basic 1.3p 1.0p 0.8p
Fully Diluted 1.2p 1.0p 0.8p
The profit and loss account includes all recognised gains and losses in the
current and preceding year. All activities were derived from continuing
operations.
ASOS PLC
Consolidated Balance Sheet
AT 31 MARCH 2005
Year ended Proforma 15 Months ended
Unaudited 12
Month period
ended
31 March 2005 31 March 2004 31 March 2004
# # #
FIXED ASSETS
Intangible
assets 1,248,482 1,476,816 1,476,816
Tangible
assets 327,315 116,182 116,182
--------- --------- ---------
1,575,797 1,592,998 1,592,998
--------- --------- ---------
CURRENT ASSETS
Stocks 1,587,308 521,680 521,680
Debtors 1,216,615 780,263 780,263
Cash at bank
and in hand 2,059,581 1,004,118 1,004,118
--------- --------- ---------
4,863,504 2,306,061 2,306,061
CREDITORS:
amounts
falling due
within one
year (2,827,586) (1,317,883) (1,317,883)
--------- --------- ---------
NET CURRENT
ASSETS 2,035,918 988,178 988,178
--------- --------- ---------
TOTAL ASSETS LESS
--------- --------- ---------
CURRENT
LIABILITIES 3,611,715 2,581,176 2,581,176
--------- --------- ---------
CAPITAL AND RESERVES
Called up
share capital 2,511,026 2,379,292 2,379,292
Share premium
account 2,995,931 2,975,358 2,975,358
Profit and
loss account (1,895,242) (2,773,474) (2,773,474)
SHAREHOLDERS' FUNDS
--------- --------- ---------
(ALL EQUITY) 3,611,715 2,581,176 2,581,176
--------- --------- ---------
ASos PLC
Consolidated Cash Flow Statement
for the YEAR ended 31 MARCH 2005
Year ended Proforma 15 Months ended
Unaudited 12
Month period
ended
31 March 2005 31 March 2004 31 March 2004
# # #
Net cash
inflow from
operating
activities 1,163,364 822,310 1,083,877
Returns on investments and
servicing of finance
Interest
received 38,799 3,126 205
Interest paid (146) - (1,123)
--------- --------- ---------
Net cash
inflow/(outflow) from
returns on investments
and servicing
of finance 38,653 3,126 (918)
Capital expenditure
Payments to
acquire
tangible fixed
assets (298,861) (61,300) (120,501)
--------- --------- ---------
NET CASH
INFLOW BEFORE
FINANCING 903,156 764,136 962,458
Financing
Net inflow
from issue of
ordinary
shares 152,307 215,582 215,582
Repayment of
short term
loan - (1,000) (1,000)
--------- --------- ---------
Net cash
inflow from
financing 152,307 214,582 214,582
--------- --------- ---------
INCREASE IN
CASH 1,055,463 978,718 1,177,040
--------- --------- ---------
NOTES TO THE CASH FLOW STATEMENT
Reconciliation of operating profit to net cash inflow from operating activities
Year Proforma 15 Months ended
Unaudited 12
Month period
ended
ended
31 March 31 March 2004 31 March 2004
2005
# # #
Operating
profit 839,579 393,712 259,123
Amortisation
charge 228,334 228,334 285,418
Depreciation
charge 87,729 57,666 74,895
(Increase)/dec
rease in stock (1,065,628) 90,405 100,534
(Increase)/dec
rease in
debtors (436,353) (173,974) 202,792
Increase in
creditors 1,509,703 226,167 161,115
------------ --------- ----------
1,163,364 822,310 1,083,877
------------ --------- ----------
EARNINGS PER SHARE
The calculations of earnings per share are based on the following:
Year 15 months
Ended ended
31 March 31 March
2005 2004
Profit attributable to shareholders 1,384,065 528,205
Weighted Average number of shares:
For basic earnings per share 69,917,012 64,861,996
For diluted earnings per share 73,907,179 66,196,066
No shares have been issued between the year end and date of approval of these
financial statements.
The financial information contained in the preliminary announcement does not
constitute the company's statutory financial statements. The company's auditors
have issued an unqualified report on the statutory financial statements for the
12 months ended 31 March 2005 and have not made any statement under section 237
(2) or (3) of the Companies Act 1985. A copy of the company's statutory
financial statements will be delivered to the Registrar of Companies shortly.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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