Asos casts shadow over retail sector with shock sales alert

Online fashion retailer Asos has warned over sales and profits after experiencing a 'significant deterioration' in trading in the run-up to Christmas.

The group said in an unscheduled trading update for the first three months of the financial year that, while it delivered sales growth of 14 per cent, it “experienced a significant deterioration in the important trading month of November and conditions remain challenging”.

The retailer has proved a hit with its core customer base of teenagers and twentysomethings. Picture: Contributed

placeholder image — The retailer has proved a hit with its core customer base of teenagers and twentysomethings. Picture: Contributed

As a result, Asos – which stands for As Seen On Screen – has reduced its expectations for the current financial year.

It now expects sales growth of 15 per cent for the year to August 2019, down from 20 per cent to 25 per cent, and its anticipated earnings margin has been revised down from 4 per cent to 2 per cent, sending shares sharply lower.

The warning is sure to cause alarm among retailers as, up until now, it has been high street firms bearing the brunt of a brutal Christmas trading period.