Spending up at Asos as profits leap in first half

Shares in Asos had a rocky ride yesterday as concerns over higher-than-expected spending plans overshadowed a double-digit hike in half-year profits at the online fashion darling. Investors seemed spooked at news of the trendy fashion retailer’s plans to spend up to £250 million boosting its infrastructure to support sales growth.

Results revealed solid trading over the group’s first half, with UK retail sales up 22 per cent to £414.5 million, while international sales lifted 28 per cent to £716.8m on a constant currency basis.

Pre-tax profits were up 10 per cent to £29.9m for the six months to 28 February.

The firm added that it notched up its highest number of website visits over the half year – at over a billion.

Nicholas Hyett, equity analyst at financial services outfit Hargreaves Lansdown,said:“theramp up of activity in Europe and creation of US infrastructure was always going to be capital intensive and, once complete, investment demands should fall back.”