LONDON — Shares in Asos sank 20.2 percent to 21.88 pounds at the close of trading on Thursday after the company issued its third profit warning in eight months.
In a trading update Thursday, Asos said total group revenue rose 12 percent to 919.8 million in the four months to June 30. It made the gains despite problems linked to its warehouse operations, which impacted stock availability in Europe and in the U.S.
In 2005, 2014 and 2017, Asos’ warehouses in Buncefield and Barnsley, England, and Berlin were damaged by fire and Asos has since then been overhauling infrastructure and technology in its U.S. and European facilities.
“Our recent performance in the EU and U.S. was held back by operational issues associated with our transformational warehouse programs. Embedding the change from the major overhaul of infrastructure and technology has taken longer than we had anticipated, impacting our stock availability, sales and cost base in these regions,” said Nick Beighton, chief executive officer of Asos.
The impact of its restructuring coupled with steady sales growth of 12 percent and higher costs will also impact the retailer’s overall profit for the year, Beighton said.
Profit will be between 30 million and 35 million pounds, well short of the 55 million pounds forecast by London banks earlier this year, and about a third of last year’s figure of 102 million pounds.
The retailer remained positive.
“We are clear on the root causes of the operational challenges we have had, are making progress on resolving them, and now expect to complete these projects by the end of September. Despite these short-term challenges, the move to a multi-site logistics infrastructure will enable us to offer customers across the world our market leading proposition, facilitate our future growth, as well as leading to longer-term efficiency benefits,” Beighton said.