ASOS has reported a 18% decline in sales for the 26 weeks to 3 March 2024 but said it has made progress on its turnaround as it continues to offload stock to “right size” the business. 

The online giant said sales were “broadly in-line with guidance”, with action taken in the last financial year to improve profitability, including a 30% fall in stock in take.

It made “good progress” on implementing its ‘Back to Fashion’ strategy, as the business continues to clear aged stock and transition to a new operating model by FY25.

The retailer said it is ahead on plans to improve stock efficiency and reduce inventory to £600 million by year end, bringing high-fashion product from design to site in two to three weeks to help increase its agility in responding to evolving customer demand.

Free cash flow improved £240 million compared to the first half of FY23, with a free cash outflow of £20 million, which ASOS said was the “strongest first-half cash performance since FY17”.

As a result of this performance, the business closed the half with a “robust” cash balance of more than £330 million, an improvement of more than £20 million from last year.

Full-year guidance remains unchanged, including a 5-15% sales decline, positive adjusted EBITDA, inventory back to pre-COVID levels, and positive cash generation, reducing net debt.

José Antonio Ramos Calamonte, CEO of ASOS, said: “ASOS is becoming a faster and more agile business, aided by the incredible work of our teams to speed up all of our processes to deliver the fashion, quality and prices that our customers want, when they want it.

“I’m excited by the performance of our new collections, while we have also made great progress in monetising inventory that built up over the pandemic and in improving the core profitability of our operations.

“We have reconfirmed our guidance for FY24 as we lay the foundations for a more profitable, cash generative business from FY25 and beyond.”

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