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Asos Resumes Trading After Warehouse Fire

The online retailer said 20 percent of the stock held at its warehouse in Barnsley, northern England, was compromised.

LONDON — Online retailer Asos reopened its Web site for trading early Monday, after suspending the site Sunday due to a fire at its U.K. warehouse. Asos said that none of the technology, automation or structure of the warehouse in Barnsley, northern England, was affected by the fire, which broke out on Friday.

 

The firm said that around 70 percent of the 159 million pounds, or $270 million, worth of stock at cost value that the business held as of May 31 was at the warehouse. Around 20 percent of that stock was compromised by damage from the fire and sprinkler systems. 

 

Asos said it is fully insured for loss of the stock and business interruption. As reported, South Yorkshire Police are treating the incident as deliberate and have started a criminal enquiry.

 

Barclays Equity Research said in a note issued Monday that it expects the disruption the fire will cause to sales and profits in the current fiscal year to be “very limited.” The note pointed to the fact that Asos is fully insured and that the company continued on a “successful growth path” following a fire at another of its warehouses in 2005.

 

Noting that the latest fire “appears to have caused significantly less damage,” Barclays estimated that two days of lost profit could result in a reduction of around 250,000 pounds, or $425,000, to Asos’ 2014 pre-tax profit, assuming compensation payment is delayed until the following fiscal year.

 

“We consider this amount reasonably trivial and positive comments from customers on social media suggest to us that Asos has not suffered any reputational risk,” it noted.

 

As of 11.30 a.m. CET, shares in Asos were up 0.4 percent on the London Stock Exchange to 27.63 pounds, or $47.00, after falling in earlier trading.