TIDMASC
RNS Number : 0706J
ASOS PLC
01 April 2015
1 April 2015
ASOS plc
Global Online Fashion Destination
Interim Results for the six months ended 28 February 2015
Summary results
Six months Six months Change
GBP'000 to 28 February to 28 February
2015 2014
-------------------------------------- --------------------------- --------------------------- --------------------
Group revenues(1) 550,474 481,726 14%
Retail sales 536,429 472,319 14%
UK retail sales 231,370 182,040 27%
International retail sales 305,059 290,279 5%
Gross profit 265,199 243,087 9%
Retail gross margin 46.8% 49.5% (270bps)
Gross margin 48.2% 50.5% (230bps)
Profit before tax(2) 18,044 20,097 (10%)
Diluted earnings per share 17.6p 18.5p (5%)
Cash and cash equivalents 64,891 36,914 76%
-------------------------------------- --------------------------- --------------------------- --------------------
(1) Includes retail sales, delivery receipts and third party
revenues
(2) For the six months to 28 February 2015, profit before tax
includes business interruption reimbursements of GBP6.3m in respect
of a warehouse fire in the prior financial year
Highlights
-- Retail sales up 14% (UK retail sales up 27%, International retail sales up 5%)
-- 9.3 million active customers(3) at 28 February 2015, up 13% on prior year
-- Retail gross margin down 270bps
-- Profit before tax(2) of GBP18.0m (2014: GBP20.1m)
-- Cash and cash equivalents of GBP64.9m (31 August 2014: GBP74.3m)
-- Zonal pricing capability deployed and Barnsley automation landed
-- New CIO and People Director appointed
(3) Defined as having shopped in the last twelve months
Nick Robertson, CEO, commented:
"Trading for the six months ended 28 February 2015 included a
record Christmas season, with total sales increasing by +14%. UK
growth remained strong with sales up +27% and International sales
up +5% (+10% on a constant currency basis). Our customer engagement
remains high, with growth in visits, average order frequency,
average basket size and conversion all improving. Our active
customers(3) grew by 13%, exceeding the 9m mark for the first
time.
The successful launch of our zonal pricing capability and
planned investment in our international prices resulted in a gross
margin decrease of 230bps during the period, which together with
increased investment in building our global distribution capacity,
has reduced half year profit before tax by 10% to GBP18.0m.
With our continued investment in our international price
competitiveness gaining traction, momentum in the business is
building. This gives us confidence in the outlook for the second
half and that full year profit and margin will be in line with
expectations."
Investor and Analyst Meeting
There will be a meeting for analysts that will take place at
9.30am today, 1 April 2015, at Greater London House, Hampstead
Road, London, NW1 7FB. A webcast of the meeting will be available
both live and following the meeting at www.asosplc.com. Please
register your attendance in advance with Instinctif Partners using
the details below.
For further information:
ASOS plc Tel: 020 7756 1000
Nick Robertson, Chief Executive Officer
Nick Beighton, Chief Operating Officer /
Chief Financial Officer
Greg Feehely, Head of Investor Relations
Website: www.asosplc.com/investors
Instinctif Partners Tel: 020 7457 2020
Matthew Smallwood / Justine Warren / Guy
Scarborough
JPMorgan Cazenove Tel: 020 7742 4000
Luke Bordewich
Numis Securities Tel: 020 7260 1000
Alex Ham
Background note
ASOS is a global fashion destination for 20-somethings. We sell
cutting-edge 'fast fashion' and offer a wide variety of
fashion-related content, making ASOS.com the hub of a thriving
fashion community. We sell over 75,000 branded and own-brand
products through localised mobile and web experiences, delivering
from our fulfilment centres in the UK, US, Europe and China to
almost every country in the world.
We tailor the mix of own-label, global and local brands sold
through each of our nine local language websites: UK, US, France,
Germany, Spain, Italy, Australia, Russia and China.
ASOS's websites attracted 88 million visits during February 2015
(February 2014: 71 million) and as at 28 February 2015 had 9.3
million active customers(1) (28 February 2014: 8.2 million), of
which 3.7 million were located in the UK and 5.6 million were
located in our international territories (28 February 2014: 3.2
million in the UK and 5.0 million internationally).
(1) Defined as having shopped in the last twelve months
www.asos.com
www.us.asos.com
www.asos.de
www.asos.fr
www.asos.com/au
www.asos.it
www.asos.es
www.asos.com/ru
www.asos.cn
m.asos.com
marketplace.asos.com
ASOS plc ("the Company")
Global Online Fashion Destination
Interim Results for the six months ended 28 February 2015
Business Review
The Group has delivered retail sales growth of 14% to GBP536.4m
(2014: GBP472.3m) during the six months ended 28 February 2015,
with encouraging momentum in our international markets following
our planned price investments and launch of our zonal pricing
solution. The impact of this international price investment on
gross margins, plus increased warehousing costs as we build our
global warehousing capability, resulted in a decline of 10% in
profit before tax to GBP18.0m (2014: GBP20.1m). We remain confident
in our outlook for the remainder of the year and our investments in
warehouse and technology remain on track.
Our fashion
Our product offer continues to be focused around three key
pillars; extensive, appropriate fashion at great value for money
for our global fashion conscious 20-something customer. We stock
over 75,000 lines across more than 750 brands, including our
exclusive in-house ASOS label. Our portfolio of third party brands
is constantly reviewed to ensure that it includes the most relevant
and sought after brands for our customer. With this in mind, over
the last six months we have added 150 new brands, including
Abercrombie & Fitch, Adidas, Ellesse, Reebok, Sisley, Only
& Sons and Liquor & Poker, and removed 180 brands.
Our ranges cater for seasonal events and trends. We have seen
our menswear customer become more focused on trend items, with
particular success in longline tops, black denim, trainers and
Chelsea boots. In Womenswear, key items for the season have
included playsuits and jumpsuits, shirts, trainers, oversized coats
and scarves. Christmas and Black Friday remain the major events of
the season; we offer a comprehensive range of going out and
occasion wear product for these events. In addition we increased
our gifting range with a more extensive selection of beauty, men's
grooming, novelty gifts and also more traditional items such as
nightwear. In addition, events such as Halloween and Valentine's
Day are becoming increasingly important to our customer and we have
responded by adding specific ranges for these celebrations.
Our wide range of sizes continues to be an important element of
our offer. We stock sizes 2 to 30 in Womenswear & XXXS to XXXL
in Menswear, as well as an assortment of leg lengths, waist and
shoes sizes. We have continued to add to this with an increased
range of Fuller Bust Lingerie and Swimwear, as well as the addition
of wide fit shoes. We also continue to extend the offer on our
specialist ranges: Plus Size, Petite, Tall and Maternity. As well
as broadening our own-label range, we have added to our third party
brands in this area; Chi Chi Plus, Jarlo Tall and John Zack Petite
are amongst a number of brand additions this season.
Our price proposition remains core to our offer. In recent
seasons we have added a range of value brands such as New Look,
Monki and Weekday that cater for our customers on a more limited
budget, whilst also ensuring that our own-label range is
competitively priced. However, a good spread of price points that
remain great value for money is also important to our customers. We
have therefore refocused our "top end" offer and streamlined our
portfolio of third party premium brands to those that remain
accessible to our 20-something customer, such as Ted Baker, Reiss,
Whistles and new additions Gestuz and Supertrash. We have also
relaunched ASOS White, our premium own label, and introduced a
range of ASOS "Red Carpet" evening dresses. Both of these ranges
have stretched the price architecture within our own-label
portfolio and have been well received by customers.
Another key element of our price proposition is our ability to
differentially price brands by market, which became possible during
the period following the launch of our zonal pricing capability.
This capability allows brands that were previously uncompetitively
priced in local currency to be priced in line with the local
market. We have affected 50 brands across Australia, the US,
France, Germany, Italy and Spain during the season and initial
results have been encouraging. We plan to add further brands over
the next six months as international price competitiveness
continues to be a key objective for us.
Operations
Technology
We remain committed to investing a total of GBP75m in our
technology by the end of the next financial year, and have made
significant progress during the last six months. We rolled out our
zonal pricing functionality in Australia, France, Germany, Spain,
Italy and the US during the period, enabling us to offer more
competitive local pricing and to sell brands which were previously
restricted in these territories.
We also launched localised versions of our Android and iOS apps
in France, Germany and the US during the period, and in Italy,
Spain and Russia during March 2015. Traffic from mobile devices now
represents over 50% of all traffic and in response to this we
launched our first mobile-only promotions during the period and
continue to improve the speed and stability of all our apps. We
will further expand our international mobile offering during the
next six months with the launch of a localised app in China.
We continue to invest in our underlying platforms and
behind-the-scenes technology in order to support our global
expansion and deliver the best customer experience. Our website
replatforming continues; we successfully reengineered our order
processing platforms to support peak volumes and we are focused on
developing our new checkout function to launch on mobile during the
next six months.
We have recently commenced our global fulfilment programme,
which will optimise our global stock management capabilities and
provide greater flexibility to move stock efficiently around our
global warehousing network. During the period, we delivered a new
warehouse control system to support our automation in Barnsley, as
well as developing stock monitoring capabilities within our Eurohub
fulfilment centre in Germany. This global fulfilment programme is a
key step in our journey to becoming a truly global retailer.
Customer Experience
Our customer engagement remains high, with growth in visits,
average order frequency, average basket size and conversion. Active
customers grew by 13% over last year, surpassing the 9m mark for
the first time.
We recently introduced our 'social sign-in' functionality across
all our websites and apps, enabling customers to sign in using
their Facebook, Twitter and Google+ details, simplifying the
customer journey from browsing to buying product. Our personalised
product recommendations function has also been launched across our
mobile apps, and will be rolled out to our websites over the next
six months. To improve our international customer experience, we
recently added our upgraded search facility to our Spanish,
Italian, Australian and Russian websites.
Uptake of our ASOS Premier membership in the UK, US, France,
Germany and Australia continues to grow, with total members up
nearly 70% on last year.
Global expansion
Our principal international objective this period has been to
restore our price competitiveness, following a period of adverse
exchange rate movements.
During the first six months of the year we have reduced local
currency prices for our Australian, New Zealand and Eurozone
customers, and initial customer response is encouraging, with
increased sales growth in these territories as well as increases in
our Comscore rankings in France, Italy and Spain (Comscore,
February 2015). We will continue to focus on our product and
pricing offer in existing strategic markets before expanding into
new markets, but expect to launch new European websites within the
next year.
We have invested a further GBP3.1m (2014: GBP3.7m) in our China
operation during the period and are pleased with our progress in
this territory.
Delivery and returns
Expanding our delivery and returns solutions remains central to
achieving our goal of providing a best-in-class customer
proposition across our strategic markets and we have continued to
enhance our offer during the last six months.
In the UK, we extended our Saturday evening next-day delivery
cut-off from 8pm to midnight and our Sunday next-day delivery
cut-off from 2pm to 5pm, as well as introducing an estimated
delivery date at checkout for standard orders.
Internationally, following the introduction of our next-day
delivery service in France and Germany, we extended this offer to
customers in Spain, Italy, Denmark, Sweden and the Netherlands
during the period. We plan to further extend our next-day delivery
service into Belgium, Ireland and Northern Ireland by the end of
this financial year. We have also added new mid-tier services in
Korea and Singapore, which have at least halved delivery lead times
in each of these territories compared with our standard service.
Over the next six months, we are planning to add similar mid-tier
services in Russia, Hong Kong, Taiwan and Japan.
We have also extended return options during the period, with the
launch of returns via Doddle stores, home collection returns and
InPost LockerBoxes in the UK. Internationally, we introduced
labelless returns in France, the Netherlands, Belgium and
Luxembourg as well as launching a three month free returns trial in
the Netherlands.
We continue to focus on developing our Pick-Up-Drop-Off ('PUDO')
network, which allows customers to collect and return their orders
from a variety of convenient locations. Customers in France, Spain,
Belgium, Luxembourg, and soon Germany, benefit from a
delivery-to-store option at over 28,000 locations and in the UK we
launched a click-and-collect trial with Boots stores in North
London. We continue to seek further PUDO solutions in all our key
strategic territories.
Warehousing
Our warehousing activities continue to increase, with total
order processing up 14% year on year, including our biggest ever
peak trading volumes during November 2014, reaching a record 2m
parcel despatches in one week.
At Barnsley, our mechanised picking solution was launched at the
start of this financial year and whilst this has involved some
short-term disruption to our logistic activities during the period,
it is now beginning to deliver operational benefits. By the end of
February, the vast majority of orders were being batch picked and
we are targeting a per-person picking capability of 200 units per
hour by the end of the financial year. Labour cost per unit for our
UK warehouses has also increased by 7% to 81p (2014: 76p) as a
result of the short-term disruption but we expect this to decrease
over the remainder of the year, and continue to target a
medium-term UK labour cost per unit of 50p.
We exited our off-site storage facility at Lister Hills during
February following the go-live of our two high bay mini-loads
earlier in the period, which double our Barnsley on-site storage
capacity. Our new warehouse control system now automatically
retrieves stock as required from the mini-loads to maintain stock
levels in the main pick-face area of the warehouse, increasing
efficiency and our stock management capabilities.
We received a further, and final, GBP6.3m insurance
reimbursement during the period following a fire in this warehouse
in June 2014. This has been reinvested in our international pricing
proposition.
We continue to develop our international warehousing
infrastructure, particularly in Europe, and during the second half
of the year will focus on increasing stock levels in our German
Eurohub, to allow us to continue to improve Eurozone delivery lead
times and further extend delivery cut-off times. The Eurohub
currently despatches 24% of total EU orders, principally to
Germany, France, Spain, Sweden and the Netherlands, and we expect
this to increase to 35% by the year end. Our returns processing
centre in Swiebodzin already processes nearly all returns from the
Eurozone, improving refund processing times.
Our warehouse in the US continues to develop and consistently
fulfils over 25% of US orders. We will turn our focus back to our
US fulfilment during the next financial year in order to further
drive local fulfilment in this territory.
People
During the period, our team grew by 281 to 1,822 employees at 28
February 2015. In addition, the Board have made a number of
appointments, strengthening the senior management team of the
Group.
We will be joined by Clifford Cohen, who has been appointed as
Group Chief Information Officer and will join the Group in May.
Clifford is a senior IT professional with an extensive background
in commercial technology leadership, programme delivery and
operations. Most recently, Clifford spent seven years with Marks
and Spencer in a variety of IT related roles including retail,
multi-channel and ultimately as Interim Group Chief Information
Officer. Prior to Marks and Spencer, Clifford spent eight years
with Accenture where he led IT teams on supply chain for Dixons
Stores, re-platforming for Sainsbury's and Merchandising and Supply
Chain for New Look.
In March, we were joined by Peter Collyer, our new People
Director, who brings exceptional experience to ASOS. He is a senior
human resource executive having worked for world class,
international, consumer facing corporations. Most recently he ran
Global HR for Claire's Stores Inc., the Chicago based retailer with
3,600 stores across 44 countries, specialising in beauty products,
jewellery and accessories for younger women. Prior to that, Peter
spent over ten years with The Walt Disney Company in a number of
people roles, ranging from the Disney Stores, Disney consumer
products and Disney global retail. Amongst his other jobs, Peter
spent four years with fashion retailer Oasis Stores.
Our search for a new Group Chief Financial Officer is now at an
advanced stage and we will update the market in due course.
These appointments all bring highly relevant experience to ASOS
from some of the world's largest international companies at a time
when ASOS is putting in place the capabilities to support the next,
significant leg in its growth story.
Financial review
Revenue
Six months to 28 February
2015 Group International
GBP'000 total UK US EU RoW total
-------- -------- ------- -------- -------- --------------
Retail sales 536,429 231,370 54,528 136,228 114,303 305,059
Growth 14% 27% 17% 7% (1%) 5%
Growth at constant
exchange rate 17% 27% 14% 14% 5% 10%
Delivery receipts 11,768 5,440 1,554 2,214 2,560 6,328
Growth 56% 60% 86% 40% 49% 53%
Third party revenues 2,277 2,277 - - - -
Growth 22% 22% - - - -
Total revenues 550,474 239,087 56,082 138,442 116,863 311,387
Growth 14% 28% 18% 7% (1%) 6%
-------- -------- ------- -------- -------- --------------
The Group generated retail sales growth of 14% during the
period, with growth of 27% in the UK and 5% in our international
markets (10% at constant exchange rates), where we have started to
see improvements following our price investments. As a result,
international retail sales now account for 57% (2014: 61%) of total
retail sales.
Retail sales in the UK increased by 27%, driven by a strong peak
Christmas trading period and continuous improvements to our
market-leading proposition in this territory. We retained our first
place position for unique visitors to apparel retailers in the
15-34 age range (Comscore, February 2015).
US retail sales have grown by 17% (constant currency growth 14%)
following further expansion of our range of locally relevant
brands, a strong full price sales mix, and uptake of our premier
membership scheme.
The EU has been impacted by adverse currency movements during
the last six months, with sales growth of 7% (constant currency
growth 14%). Following improvements to our delivery proposition in
key European countries and investment in our prices across the
Eurozone, sales momentum has started to recover in recent months.
Growth is particularly encouraging in France, where customers are
responding well to our localised promotions following the launch of
our zonal pricing functionality in this territory.
Our Rest of World segment also continues to be affected by
adverse currency movements with reported sales down 1% on prior
year, although sales in this territory were up 5% on a constant
currency basis. Our price investments in Australia and New Zealand
have been well received and recent visits growth is encouraging. We
comfortably retained our first place Comscore position in
Australia. Sales in Russia have continued to suffer due to
macro-economic factors and adverse exchange rates in this
territory. Our ASOS China operation had a strong Christmas trading
period and we continue to focus on increasing brand awareness and
our market share in this territory.
Delivery receipts increased by 56% driven by the introduction of
global minimum free-delivery spend thresholds in late 2014, a wider
range of paid delivery options and uptake in our premier membership
scheme.
Third party revenues, which mainly comprise advertising revenues
from the website and the ASOS magazine, increased by 22% as we
undertook larger campaigns than in the prior period.
Customer engagement
We have continued to attract new customers and had 9.3m active
customers(1) at 28 February 2015, an increase of 13% since the
comparative period. Average basket value increased by 7%, driven by
an 8% increase in average units per basket as customers responded
well to our ongoing proposition improvements, including our free
international express delivery offers above a minimum spend
threshold.
Conversion(2) increased by 10bps and average order frequency
increased by 6%, reflecting the compelling nature of our
proposition.
Six months Six months Change
to 28 February to 28 February
2015 2014
------------------------------------------- ---------------- ---------------- -------
Active customers(1) ('000) 9,268 8,173 13%
Average basket value (including VAT) GBP67.12 GBP62.67 7%
Average units per basket 2.72 2.52 8%
Average selling price per unit (including
VAT) GBP24.70 GBP24.85 (1%)
Total orders ('000) 14,087 12,321 14%
Total visits ('000) 523,665 469,107 12%
------------------------------------------- ---------------- ---------------- -------
(1) As at 28 February, defined as having shopped during the last
twelve months
(2) Calculated as total orders divided by total visits
Gross profitability
Six months to 28
February 2015 Group International
total UK US EU RoW total
--------- --------- ------- --------- --------- --------------
Gross profit (GBP'000) 265,199 107,042 32,738 67,272 58,147 158,157
Growth 9% 23% 19% 2% (7%) 1%
Retail gross margin 46.8% 42.9% 57.2% 47.8% 48.6% 49.8%
Growth (270bps) (210bps) 30bps (260bps) (390bps) (250bps)
Gross margin 48.2% 44.8% 58.4% 48.6% 49.8% 50.8%
Growth (230bps) (170bps) 70bps (240bps) (340bps) (220bps)
--------- --------- ------- --------- --------- --------------
Retail gross margin decreased by 270bps compared with last year,
to 46.8% (2014: 49.5%). This was driven by our price investments in
the Eurozone and Rest of World territories to ensure we continue to
offer our customers compelling local currency prices, as well as
increased return rates, principally in the UK and Germany. This was
offset by an improvement in our full-price sales mix, particularly
in the US. Gross margin (including third-party revenues and
delivery receipts) decreased by 230bps to 48.2% (2014: 50.5%).
Operating expenses
The Group increased its investment in operating resources by 14%
to GBP253.5m during the period, as we have continued to invest in
our warehousing and IT infrastructure as well as our customer
proposition. Total operating costs to sales ratio improved by 30bps
over the same period.
Six months Six months
to 28 February to 28 February
GBP'000 2015 2014 Change
----------------------------------- ---------------- ----------------- -------
Distribution costs (78,771) (72,944) (8%)
Payroll and staff costs (50,316) (44,194) (14%)
Warehousing (50,064) (34,724) (44%)
Marketing (26,442) (31,505) 16%
Production (2,438) (2,383) (2%)
Technology costs (9,643) (7,315) (32%)
Other operating costs (25,493) (22,547) (13%)
Depreciation and amortisation (10,374) (7,494) (38%)
----------------------------------- ---------------- ----------------- -------
Total operating costs (253,541) (223,106) (14%)
Operating cost ratio (% of sales) 46.0% 46.3% 30bps
----------------------------------- ---------------- ----------------- -------
Distribution costs decreased by 80bps to 14.3% of sales despite
an increase in total orders of 14% during the period, due to the
continued high proportion of lower cost UK shipments, a decrease in
EU distribution costs as we increase the number of shipments from
our Eurohub, and negotiation of more favourable carrier rates.
Staff costs decreased by 10bps to 9.1% of sales as headcount
increases were offset by restructuring of management share
incentive awards since the prior year.
Warehousing costs increased by 190bps to 9.1% of sales
principally as a result of one-off short-term additional running
costs at our Barnsley warehouse following the launch of our
automation technology during the first half of the year, as well as
increasing investment in our global warehousing infrastructure,
particularly in Europe.
Marketing costs have decreased by 170bps to 4.8% of sales as
spend on international marketing campaigns was limited during the
period whilst we focus on restoring the price competiveness of our
products. Our digital marketing activities have however continued
in order to drive awareness and grow our market share.
IT costs increased by 30bps to 1.8% of sales as a result of
increased traffic across our expanded range of global
platforms.
Other operating costs have decreased by 10bps to 4.6% of sales
due to a continued focus on controlling costs related to travel and
entertaining.
Depreciation has increased by 30bps to 1.9% of sales following
our recent accelerated investment in our warehouse and IT
infrastructure, particularly in our mechanised picking
solution.
We incurred operating costs of GBP3.1m (2014: GBP3.7m) related
to our activities in China during the period. These related largely
to warehousing and staff costs.
Net other income
We received final business interruption insurance reimbursements
during the period of GBP6.3m as a result of a fire in our Barnsley
warehouse in June 2014. This amount is included within a separate
line item titled 'net other income' in the Income Statement, and
has been reinvested in our international pricing proposition during
the period. Total business interruption receipts resulting from the
fire are GBP9.3m.
GBP'000 Six months Six months Year to
to to 31 August
28 February 28 February 2014
2015 2014
Stock loss and other incremental costs - - (8,486)
Insurance reimbursements 6,299 - 11,536
Total 6,299 - 3,050
------------------------------------------------ ------------- ------------- -----------
Income statement
The Group generated profit before tax of GBP18.0m, down 10% on
last year (2014: GBP20.1m) due to the decline in gross margin as a
result of international price investments, plus additional
operating expenses related to investments in our warehousing
infrastructure.
Six months Six months
to 28 February to 28 February
GBP'000 2015 2014 Change
------------------------- ---------------- ----------------- -------
Revenue 550,474 481,726 14%
Cost of sales (285,275) (238,639)
------------------------- ---------------- ----------------- -------
Gross profit 265,199 243,087 9%
Distribution expenses (78,771) (72,944) (8%)
Administrative expenses (174,770) (150,162) (16%)
Net other income 6,299 -
Operating profit 17,957 19,981 (10%)
Net finance income 87 116
Profit before tax 18,044 20,097 (10%)
Income tax expense (3,735) (4,796)
------------------------- ---------------- ----------------- -------
Profit after tax 14,309 15,301 (6%)
------------------------- ---------------- ----------------- -------
Taxation
The effective tax rate decreased by 320bps to 20.7% (2014:
23.9%), principally due to a reduction in the prevailing rate of UK
corporation tax and prior year permanently disallowable charges in
respect of the ASOS Long-Term Incentive Plan, which have not been
repeated during 2015. Going forward, we expect the effective tax
rate to be approximately 100bps higher than the prevailing rate of
UK corporation tax due to permanently disallowable items.
Earnings per share
Basic earnings per share decreased by 5% to 17.6p (2014: 18.6p)
and diluted earnings per share decreased by 5% to 17.6p (2014:
18.5p), both driven by the decline in profit after tax during the
period.
Statement of financial position
The Group continues to enjoy a robust financial position
including a strong cash balance. Net assets increased by GBP25.6m
to GBP218.7m during the period (31 August 2014: GBP193.0m), driven
principally by the Group's profit after tax. The Group's cash
position decreased by GBP9.4m to GBP64.9m (31 August 2014:
GBP74.3m).
The summary statement of financial position is shown below.
At At
28 February 31 August
GBP'000 2015 2014
-------------------------------------- ------------- -----------
Goodwill and other intangible assets 70,449 63,901
Property, plant and equipment 61,167 55,400
Non-current assets 131,616 119,301
-------------------------------------- ------------- -----------
Inventories 161,571 161,480
Net current payables (149,231) (165,154)
Cash and cash equivalents 64,891 74,340
Derivative financial assets 12,338 2,240
Current tax (liability)/asset (1,397) 2,217
Deferred tax liability (1,138) (1,393)
-------------------------------------- ------------- -----------
Net assets 218,650 193,031
-------------------------------------- ------------- -----------
Statement of cash flows
The Group's cash balance decreased by GBP9.4m to GBP64.9m during
the period (31 August 2014: GBP74.3m) as operating profit of
GBP18.0m was offset by capital expenditure of GBP27.0m. The summary
statement of cash flows is shown below.
Six months to Six months to
28 February 28 February
GBP'000 2015 2014
-------------------------------------------------------------- -------------- ---------------
Operating profit 17,957 19,981
Depreciation and amortisation 10,374 7,494
Losses on disposal of assets 52 93
Working capital (12,174) (27,492)
Share-based payments charge 1,082 2,527
Other non-cash items 269 (75)
Tax paid (145) (2,346)
Cash inflow from operating activities 17,415 182
Capital expenditure (26,961) (34,259)
Proceeds from issue of ordinary shares - 563
Net cash inflow/(outflow) relating to Employee Benefit Trust 38 (632)
Acquisition of subsidiary - 182
Net finance income received 61 82
Total cash outflow (9,447) (33,882)
-------------------------------------------------------------- -------------- ---------------
Opening cash and cash equivalents 74,340 71,139
Effect of exchange rates on cash and cash equivalents (2) (343)
-------------------------------------------------------------- -------------- ---------------
Closing cash and cash equivalents 64,891 36,914
-------------------------------------------------------------- -------------- ---------------
Cash generated from operating profit increased by GBP17.2m in
comparison to the prior period, principally due to a reduction in
working capital outflow as a result of tight stock management and
final business interruption insurance reimbursements relating to
the warehouse fire. This cash inflow from operating activities was
offset by total capital expenditure of GBP27.0m on our warehouse
and technology infrastructure during the period.
Fixed asset additions
Six months Six months
to to
28 February 28 February
GBP'000 2015 2014
----------------------------- ------------- --------------
IT 14,407 16,101
Office fixtures and fit-out 667 2,753
Warehouse 8,504 16,497
Total 23,578 35,351
----------------------------- ------------- --------------
We continue to invest in our warehousing and IT infrastructure
to support our future annual sales target of GBP2.5bn. The majority
of our warehousing spend related to our automation technology at
Barnsley while our IT spend related to our continuing
behind-the-scenes work to move from our legacy platforms to a new
truly global and scalable platform.
Outlook
Our recent investment in international prices has generated
increasing momentum in visits and sales, and we expect this to
continue during the second half of the year. We are confident of
our outlook for the remainder of the financial year and expect
profit before tax for the year to be in line with market
expectations. We are pleased with progress in our investments in
our warehousing and IT infrastructure, and we continue to focus on
building capacity to reach our next staging post of GBP2.5bn
sales.
Nick Robertson Nick Beighton
Chief Executive Officer Chief Operating Officer
CONDENSED UNAUDITED Consolidated Statement of Total
Comprehensive Income
For the six months ended 28 February 2015
Six months Six months Year to 31
to 28 February to 28 February August 2014
2015 2014
(unaudited) (unaudited) (audited)
GBP'000 GBP'000 GBP'000
Revenue 550,474 481,726 975,470
Cost of sales (285,275) (238,639) (490,463)
---------------- ---------------- ---------------
Gross profit 265,199 243,087 485,007
Distribution expenses (78,771) (72,944) (147,303)
Administrative expenses (174,770) (150,162) (294,108)
------------------------------------------- ---------------- ---------------- ---------------
Warehouse fire: stock loss
and other incremental costs - - (8,486)
Warehouse fire: insurance reimbursements 6,299 - 11,536
------------------------------------------- ---------------- ---------------- ---------------
Net other income (Note 4) 6,299 - 3,050
Operating profit 17,957 19,981 46,646
Finance income 145 168 312
Finance expense (58) (52) (57)
---------------- ---------------- ---------------
Profit before tax 18,044 20,097 46,901
Income tax expense (3,735) (4,796) (10,313)
---------------- ---------------- ---------------
Profit for the period 14,309 15,301 36,588
================ ================ ===============
Net translation movements offset
in reserves (134) (120) (176)
Net fair value gain on derivative
financial assets 10,098 1,193 2,015
---------------- ---------------- ---------------
Other comprehensive income
for the period(1) 9,964 1,073 1,839
---------------- ---------------- ---------------
Total comprehensive income 24,273 16,374 38,427
================ ================ ===============
Profit/(loss) attributable
to:
Owners of the parent company 14,578 15,407 36,950
Non-controlling interest (269) (106) (362)
---------------- ---------------- ---------------
14,309 15,301 36,588
================ ================ ===============
Total comprehensive income/(loss)
attributable to:
Owners of the parent 24,542 16,480 38,789
Non-controlling interest (269) (106) (362)
---------------- ---------------- ---------------
24,273 16,374 38,427
================ ================ ===============
Earnings per share (Note 5)
Basic 17.6p 18.6p 44.6p
Diluted 17.6p 18.5p 44.5p
================ ================ ===============
(1) All items of other comprehensive income may be reclassified
to profit or loss. Net fair value gains on derivative financial
assets will be reclassified from other comprehensive income to
profit or loss during the next twelve months.
CONDENSED UNAUDITED Consolidated Statement of Changes in
Equity
For the six months ended 28 February 2015
Equity
Employee attributable
Called Benefit to owners
up share Share Retained Trust Hedging Translation of the Non-controlling Total
capital premium earnings(1) reserve reserve reserve parent interest equity
(unaudited) (unaudited) (unaudited) (unaudited) (unaudited) (unaudited) (unaudited) (unaudited) (unaudited)
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
At 1 September
2014 2,920 6,901 186,927 (5,330) 2,240 (221) 193,437 (406) 193,031
Net cash
received
on exercise
of shares
from
EBT(2) - - - 38 - - 38 - 38
Transfer of
shares from
EBT(2) on
exercise - - (108) 108 - - - - -
Share-based
payments
charge - - 1,082 - - - 1,082 - 1,082
Profit/(loss)
for the
period - - 14,578 - - - 14,578 (269) 14,309
Other
comprehensive
income/(loss)
for the
period - - - - 10,098 (134) 9,964 - 9,964
Deferred tax
on share
options - - 111 - - - 111 - 111
Current tax
on items
taken
directly to
equity - - 115 - - - 115 - 115
At 28 February
2015 2,920 6,901 202,705 (5,184) 12,338 (355) 219,325 (675) 218,650
============ ============ ============ ============ ============ ============ ============= ================ ============
Employee Equity
Called up Benefit attributable
share Share Retained Trust Hedging Translation to owners of Non-controlling Total
capital premium earnings(1) reserve reserve reserve the parent interest equity
(unaudited) (unaudited) (unaudited) (unaudited) (unaudited) (unaudited) (unaudited) (unaudited) (unaudited)
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
At 1 September
2013 2,890 6,368 152,133 (1,770) 225 (45) 159,801 (2) 159,799
Shares
allotted in
the period 30 533 - - - - 563 - 563
Purchase of
shares by
EBT(2) - - - (632) - - (632) - (632)
Transfer of
shares from
EBT(2) on
exercise - - (59) 59 - - - - -
Share based
payments
charge - - 2,527 - - - 2,527 - 2,527
Profit/(loss)
for the
period - - 15,407 - - - 15,407 (106) 15,301
Other
comprehensive
income/(loss)
for the
period - - - - 1,193 (120) 1,073 - 1,073
Acquisition of
subsidiary - - (535) - - - (535) (42) (577)
Deferred tax
on share
options - - (7,284) - - - (7,284) - (7,284)
Current tax on
items taken
directly to
equity - - 2,643 - - - 2,643 - 2,643
At 28 February
2014 2,920 6,901 164,832 (2,343) 1,418 (165) 173,563 (150) 173,413
============ ============ ============ ============ ============ ============ ============= ================ ============
Employee Equity
Called up Benefit attributable
share Share Retained Trust Hedging Translation to owners of Non-controlling Total
capital premium earnings(1) reserve reserve reserve the parent interest equity
(audited) (audited) (audited) (audited) (audited) (audited) (audited) (audited) (audited)
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
At 1 September
2013 2,890 6,368 152,133 (1,770) 225 (45) 159,801 (2) 159,799
Shares
allotted in
the period 30 533 - - - - 563 - 563
Purchase of
shares by
EBT(2) - - - (3,914) - - (3,914) - (3,914)
Transfer of
shares from
EBT(2) on
exercise - - (354) 354 - - - - -
Share based
payments
credit - - (2,813) - - - (2,813) - (2,813)
Profit/(loss)
for the
period - - 36,950 - - - 36,950 (362) 36,588
Other
comprehensive
income/(loss)
for the
period - - - - 2,015 (176) 1,839 - 1,839
Acquisition of
subsidiary - - - - - - - (42) (42)
Deferred tax
on share
options - - (8,730) - - - (8,730) - (8,730)
Current tax on
items taken
directly to
equity - - 9,741 - - - 9,741 - 9,741
Balance as at
31 August
2014 2,920 6,901 186,927 (5,330) 2,240 (221) 193,437 (406) 193,031
========== ========== ============ ========== ========== ============ ============= ================ ==========
(1) Retained earnings includes the share-based payments
reserve
(2) Employee Benefit Trust and Capita Trust
CONDENSED UNAUDITED Consolidated Statement of Financial
PositioN
At 28 February 2015
At At At
28 February 28 February 31 August
2015 2014 2014
(unaudited) (unaudited) (audited)
GBP'000 GBP'000 GBP'000
Non-current assets
Goodwill 1,060 1,325 1,325
Other intangible assets 69,389 50,280 62,576
Property, plant and equipment 61,167 46,141 55,400
Deferred tax asset - 1,127 -
------------- ------------- -----------
131,616 98,873 119,301
------------- ------------- -----------
Current assets
Inventories 161,571 154,640 161,480
Trade and other receivables 18,589 19,110 20,385
Derivative financial assets
(Note 8) 12,338 1,418 2,240
Current tax asset - - 2,217
Cash and cash equivalents (Note
6) 64,891 36,914 74,340
-------------
257,389 212,082 260,662
------------- ------------- -----------
Current liabilities
Trade and other payables (167,820) (135,201) (185,539)
Current tax liability (1,397) (1,806) -
------------- ------------- -----------
(169,217) (137,007) (185,539)
------------- ------------- -----------
Net current assets 88,172 75,075 75,123
-------------
Non-current liabilities
------------- ------------- -----------
Deferred tax liability (1,138) (535) (1,393)
------------- ------------- -----------
Net assets 218,650 173,413 193,031
============= ============= ===========
Equity attributable to owners
of the parent
Called up share capital 2,920 2,920 2,920
Share premium 6,901 6,901 6,901
Employee Benefit Trust reserve (5,184) (2,343) (5,330)
Hedging reserve 12,338 1,418 2,240
Translation reserve (355) (165) (221)
Retained earnings 202,705 164,832 186,927
-------------
219,325 173,563 193,437
------------- ------------- -----------
Non-controlling interests (675) (150) (406)
Total equity 218,650 173,413 193,031
============= ============= ===========
CONDENSED UNAUDITED Consolidated Statement of Cash Flows
For the six months ended 28 February 2015
Six months Six months Year to 31
to 28 February to 28 February August 2014
2015 2014
(unaudited) (unaudited) (audited)
GBP'000 GBP'000 GBP'000
Operating profit 17,957 19,981 46,646
Adjusted for:
Depreciation of property, plant
and equipment 3,673 3,044 5,860
Amortisation of other intangible
assets 6,701 4,450 9,501
Loss on disposal of non-current
assets 52 93 150
Decrease/(increase) in inventories 111 (11,499) (18,352)
Decrease/(increase) in trade and
other receivables 1,808 (821) (1,844)
(Increase)/decrease in trade and
other payables (14,093) (15,172) 33,522
Share-based payments charge/(credit) 1,082 2,527 (2,813)
Other non-cash items 269 (75) (297)
Income tax paid (145) (2,346) (3,714)
---------------- ---------------- -------------
Net cash generated from operating
activities 17,415 182 68,659
Investing activities
Payments to acquire other intangible
assets (15,213) (16,636) (32,627)
Payments to acquire property,
plant and equipment (11,748) (17,623) (29,750)
Finance income 123 146 296
Acquisition of subsidiary, net
of cash acquired - 182 182
---------------- ----------------
Net cash used in investing activities (26,838) (33,931) (61,899)
Financing activities
Proceeds from issue of ordinary
shares - 563 563
Net cash inflow/(outflow) relating
to Employee Benefit Trust 38 (632) (3,914)
Finance expense (62) (64) (65)
---------------- ---------------- -------------
Net cash used in financing activities (24) (133) (3,416)
Net (decrease)/increase in cash
and cash equivalents (9,447) (33,882) 3,344
================ ================ =============
Opening cash and cash equivalents 74,340 71,139 71,139
Effect of exchange rates on cash
and cash equivalents (2) (343) (143)
---------------- ---------------- -------------
Closing cash and cash equivalents 64,891 36,914 74,340
---------------- ---------------- -------------
Notes to the CONDENSED UNAUDITED financial information
For the six months ended 28 February 2015
1. Preparation of the condensed unaudited consolidated financial
information
a) Basis of preparation
The interim financial statements for the six months ended 28
February 2015 have been prepared in accordance with IAS 34,
"Interim Financial Reporting" as adopted by the European Union. The
interim financial information should be read in conjunction with
the Group's Annual Report and Accounts for the year ended 31 August
2014, which has been prepared in accordance with IFRSs as adopted
by the European Union.
The interim consolidated financial information contained in this
report has been reviewed, not audited, and does not constitute
statutory accounts within the meaning of section 434 of the
Companies Act 2006. The Annual Report and Accounts for the year
ended 31 August 2014 has been filed with the Registrar of
Companies. The auditors' report on those accounts was unqualified,
did not include a reference to any matters to which the auditors
drew attention by way of emphasis without qualifying the report and
did not contain statements under s498(2) or s498(3) of the
Companies Act 2006.
The Group's business activities together with the factors that
are likely to affect its future developments, performance and
position are set out in the Business Review. The Business Review
describes the Group's financial position, cash flows and borrowing
facilities.
The interim financial statements were approved by the Board of
Directors on 31 March 2015.
Going concern
The Directors have reviewed current performance and forecasts,
combined with expenditure commitments, including capital
expenditure. After making enquiries, the Directors have a
reasonable expectation that the Group has adequate financial
resources to continue its current operations, including contractual
and commercial commitments for the foreseeable future. For this
reason, they have continued to adopt the going concern basis in
preparing the interim financial statements.
Statement of Directors' responsibilities
The Directors confirm that, to the best of their knowledge, this
condensed set of consolidated financial statements have been
prepared in accordance with IAS 34 "Interim Financial Reporting" as
adopted by the European Union, and that the interim management
report includes a fair review of the information required.
Accounting policies
The interim financial statements have been prepared in
accordance with the accounting policies set out in the Annual
Report and Accounts for the year ended 31 August 2014. Various new
accounting standards and amendments were issued during the period,
none of which have had or are expected to have any significant
impact on the Group, and none of which have been adopted early.
Taxes on income in the interim periods are accrued using the tax
rate that would be applicable to the expected total annual
earnings.
2. Principal risks and uncertainties
The Board considers the principal risks and uncertainties which
could impact the Group over the remaining six months of the
financial year to 31 August 2015 to be unchanged from those set out
in the Annual Report and Accounts for the year ended 31 August
2014, summarised as follows:
- Market risks, including maintaining our market position and
fashionability, failure to meet customer demand and meet the needs
of changing customer tastes
- Technological risk, including robustness and sufficiency of IT
systems and infrastructure, and failure to adopt technological
innovations
- Financial risks, including exposure to changes in interest and foreign exchange rates
- Supply chain risks, including interruption to supply of core
category products and disruption to delivery services or
warehousing activities
- Brand and reputational risks
- Reliance on key personnel
These are set out in detail on pages 16 to 18 of the Group's
Annual Report and Accounts for the year ended 31 August 2014, a
copy of which is available on the Group's website, www.asosplc.com.
Information on financial risk management is also detailed on pages
69 to 70 of the Annual Report.
3. Segmental analysis
IFRS 8 'Operating Segments' requires operating segments to be
determined based on the Group's internal reporting to the Chief
Operating Decision Maker. The Chief Operating Decision Maker has
been determined to be the Executive Board and has determined that
the primary segmental reporting format of the Group is geographical
by customer location, based on the Group's management and internal
reporting structure.
The Executive Board assesses the performance of each segment
based on revenue and gross profit after distribution expenses,
which excludes administrative expenses.
Six months to 28 February 2015 (unaudited)
UK US EU RoW Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Retail sales 231,370 54,528 136,228 114,303 536,429
Delivery receipts 5,440 1,554 2,214 2,560 11,768
Third party
revenues 2,277 - - - 2,277
Internal revenues 376 - - 1,309 1,685
---------------- ---------------- ---------------- ---------------- ----------------
Total segment
revenue 239,463 56,082 138,442 118,172 552,159
Eliminations (376) - - (1,309) (1,685)
---------------- ---------------- ---------------- ---------------- ----------------
Total revenue 239,087 56,082 138,442 116,863 550,474
Cost of sales (132,045) (23,344) (71,170) (58,716) (285,275)
---------------- ---------------- ---------------- ---------------- ----------------
Gross profit 107,042 32,738 67,272 58,147 265,199
Distribution
expenses (25,050) (17,239) (18,092) (18,390) (78,771)
---------------- ---------------- ---------------- ---------------- ----------------
Segment result 81,992 15,499 49,180 39,757 186,428
Administrative
expenses (174,770)
Net other income 6,299
Operating profit 17,957
Finance income 145
Finance expense (58)
----------------
Profit before tax 18,044
================
Internal revenues relate largely to sale of stock by ASOS.com to
ASOS (Shanghai) Commerce Co. Limited.
Six months to 28 February 2014 (unaudited)
UK US EU RoW Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Retail sales 182,040 46,749 127,626 115,904 472,319
Delivery
receipts 3,410 835 1,582 1,717 7,544
Third party
revenues 1,863 - - - 1,863
Internal
revenues - - - 400 400
Total segment
revenue 187,313 47,584 129,208 118,021 482,126
Eliminations - - - (400) (400)
------------------ ----------------- ----------------- ----------------- ------------------
Total revenue 187,313 47,584 129,208 117,621 481,726
Cost of sales (100,182) (20,131) (63,325) (55,001) (238,639)
------------------ ----------------- ----------------- ----------------- ------------------
Gross profit 87,131 27,453 65,883 62,620 243,087
Distribution
expenses (17,896) (15,100) (17,784) (22,164) (72,944)
------------------ ----------------- ----------------- ----------------- ------------------
Segment result 69,235 12,353 48,099 40,456 170,143
Administrative
expenses (150,162)
------------------
Operating
profit 19,981
Finance income 168
Finance expense (52)
------------------
Profit before
tax 20,097
==================
Year to 31 August 2014 (audited)
UK US EU RoW Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Retail sales 372,241 92,311 256,385 234,358 955,295
Delivery receipts 7,412 1,773 3,162 3,604 15,951
Third party
revenues 4,224 - - - 4,224
Internal revenues 111 - - 7,654 7,765
---------------- ---------------- ---------------- ---------------- ----------------
Total segment
revenue 383,988 94,084 259,547 245,616 983,235
Eliminations (111) - - (7,654) (7,765)
---------------- ---------------- ---------------- ---------------- ----------------
Total revenue 383,877 94,084 259,547 237,962 975,470
Cost of sales (207,853) (40,137) (126,460) (116,013) (490,463)
---------------- ---------------- ---------------- ---------------- ----------------
Gross profit 176,024 53,947 133,087 121,949 485,007
Distribution
expenses (39,618) (28,804) (37,062) (41,819) (147,303)
---------------- ---------------- ---------------- ---------------- ----------------
Segment result 136,406 25,143 96,025 80,130 337,704
Administrative
expenses (294,108)
Net other income 3,050
Operating profit 46,646
Finance income 312
Finance expense (57)
----------------
Profit before tax 46,901
================
Due to the nature of its activities, the Group is not reliant on
any individual major customers.
No analysis of the assets and liabilities of each operating
segment is provided to the Chief Operating Decision Maker in the
monthly management accounts therefore no measure of segments assets
or liabilities is disclosed in this note.
There are no material non-current assets located outside the
UK.
4. Net other income
Net other income recognised during the six months ended 28
February 2015 relates to final business interruption reimbursements
as a result of the fire in our main distribution hub in June 2014.
Amounts recognised during the year to 31 August 2014 related to
insurance reimbursements related to stock loss and other
incremental costs plus a portion of business interruption
losses.
Six months Six months Year to
to 28 February to 28 February 31 August
2015 2014 2014
(unaudited) (unaudited) (audited)
GBP'000 GBP'000 GBP'000
Stock loss and other incremental
costs - - (8,486)
Insurance reimbursements 6,299 - 11,536
----------------
Total 6,299 - 3,050
================ ================ ===========
At 31 August 2014, the Group disclosed a contingent asset in
relation to these expected final business interruption
reimbursements. This contingent asset no longer exists as at 28
February 2015 as a result of the reimbursements received above.
5. Earnings per share
Basic earnings per share is calculated by dividing the profit
attributable to the owners of the parent company by the weighted
average number of ordinary shares in issue during the year. Own
shares held by the Employee Benefit Trust and Capita Trust are
eliminated from the weighted average number of ordinary shares.
Diluted earnings per share is calculated by dividing the profit
attributable to the owners of the parent company by the weighted
average number of ordinary shares in issue during the period,
adjusted for the effects of potentially dilutive share options.
Six months Six months Year to
to 28 February to 28 February 31 August
2015 2014 2014
(unaudited) (unaudited) (audited)
No. of shares No. of shares No. of shares
Weighted average share capital
Weighted average shares in issue
for basic earnings per share 82,921,082 82,707,823 82,845,587
Weighted average effect of dilutive
options 64,978 442,819 279,864
---------------- ---------------- --------------
Weighted average shares in issue
for diluted earnings per share 82,986,060 83,150,642 83,125,451
================ ================ ==============
Six months Six months Year to 31
to 28 February to 28 February August
2015 2014 2014
(unaudited) (unaudited) (audited)
GBP'000 GBP'000 GBP'000
Earnings
Underlying earnings attributable
to owners of the parent 14,578 15,407 36,950
================ ================
Six months Six months Year to 31
to 28 February to 28 February August
2015 2014 2014
(unaudited) (unaudited) (audited)
Pence Pence Pence
Earnings per share
Basic earnings per share 17.6 18.6 44.6
Diluted earnings per share 17.6 18.5 44.5
================ ================ ==============
6. Reconciliation of cash and cash equivalents
Six months Six months Year to 31
to 28 February to 28 February August
2015 2014 2014
(unaudited) (unaudited) (audited)
GBP'000 GBP'000 GBP'000
Net movement in cash and cash equivalents (9,447) (33,882) 3,344
Opening cash and cash equivalents 74,340 71,139 71,139
Effect of exchange rates on cash
and cash equivalents (2) (343) (143)
---------------- ---------------- -----------
Closing cash and cash equivalents 64,891 36,914 74,340
================ ================ ===========
The Group has a GBP20m revolving loan credit facility which
includes an ancillary GBP10m guaranteed overdraft facility and
which is available until July 2015. We expect to renegotiate this
loan facility during the second half of the year.
7. Capital expenditure and commitments
During the period, the Group acquired property, plant and
equipment of GBP9.7m and intangible assets of GBP13.9m. Disposals
were immaterial. At the period end capital commitments contracted,
but not provided for by the Group, amounted to GBP2.6m.
8. Financial instruments
There are no changes to the categories of financial instruments
held by the Group.
Six months Six months Year to 31
to 28 February to 28 February August
2015 2014 2014
(unaudited) (unaudited) (audited)
GBP'000 GBP'000 GBP'000
Financial assets
Loans and receivables(1) 75,595 48,349 86,058
Derivative financial assets 12,338 1,418 2,240
================ ================ ===========
Financial liabilities
Amortised cost(2) (165,152) (133,015) (181,481)
================ ================ ===========
(1) Loans and receivables include trade and other receivables
and cash and cash equivalents, and excludes prepayments.
(2) Included in financial liabilities at amortised cost are
trade payables, accruals and other payables.
The Group operates internationally and is therefore exposed to
foreign currency transaction risk, primarily on sales denominated
in US dollars, Euros and Australian dollars. The Group's policy is
to mitigate foreign currency transaction exposures where possible
and the Group uses financial instruments in the form of forward
foreign exchange contracts to hedge future highly probable foreign
currency cash flows.
These forward foreign exchange contracts are classified above as
derivative financial assets and are classified as Level 2 financial
instruments under IFRS 13, "Fair Value Measurement." They have been
fair valued at 28 February 2015 with reference to spot exchange
rates that are quoted in an active market. All forward foreign
exchange contracts were assessed to be highly effective during the
period to 28 February 2015 and a net unrealised gain of
GBP10,098,000 (2014: GBP1,193,000) was recognised in equity. All
derivative financial assets at 28 February 2015 mature within one
year based on the related contractual arrangements.
9. Related Parties
The Group's related parties are the Employee Benefit Trust,
Capita Trust and key management personnel. There have been no
material changes to the Group's related party transactions during
the six months to 28 February 2015.
Independent review report to ASOS PLC
Introduction
We have been engaged by the Company to review the interim
results for the six months ended 28 February 2015, which comprises
the condensed consolidated statement of total comprehensive income,
condensed consolidated statement of financial position, condensed
consolidated statement of changes in equity, condensed consolidated
cash flow statement and related notes. We have read the other
information contained in the half-yearly financial report and
considered whether it contains any apparent misstatements or
material inconsistencies with the information in the condensed set
of financial statements.
Directors' responsibilities
The half-yearly financial report is the responsibility of, and
has been approved by, the directors. The directors are responsible
for preparing the half-yearly financial report in accordance with
the AIM Rules for Companies which require that the financial
information must be presented and prepared in a form consistent
with that which will be adopted in the company's annual financial
statements.
As disclosed in Note 1, the annual financial statements of the
group are prepared in accordance with IFRSs as adopted by the
European Union. The condensed set of financial statements included
in this half-yearly financial report has been prepared in
accordance with the International Accounting Standard 34, "Interim
Financial Reporting", as adopted by the European Union.
Our responsibility
Our responsibility is to express to the company a conclusion on
the condensed set of financial statements in the half-yearly
financial report based on our review. This report, including the
conclusion, has been prepared for and only for the company for the
purpose of the AIM Rules for Companies and for no other purpose. We
do not, in producing this report, accept or assume responsibility
for any other purpose or to any other person to whom this report is
shown or into whose hands it may come save where expressly agreed
by our prior consent in writing.
Scope of review
We conducted our review in accordance with International
Standard on Review Engagements (UK and Ireland) 2410, 'Review of
Interim Financial Information Performed by the Independent Auditor
of the Entity' issued by the Auditing Practices Board for use in
the United Kingdom. A review of interim financial information
consists of making enquiries, primarily of persons responsible for
financial and accounting matters, and applying analytical and other
review procedures. A review is substantially less in scope than an
audit conducted in accordance with International Standards on
Auditing (UK and Ireland) and consequently does not enable us to
obtain assurance that we would become aware of all significant
matters that might be identified in an audit. Accordingly, we do
not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that
causes us to believe that the condensed set of financial statements
in the half-yearly financial report for the six months ended 28
February 2015 is not prepared, in all material respects, in
accordance with International Accounting Standard 34 as adopted by
the European Union and the AIM Rules for Companies.
The condensed interim financial statements for the period ended
28 February 2014 forming the corresponding figures of the condensed
interim financial statements for the period ended 28 February 2015
have not been reviewed.
PricewaterhouseCoopers LLP
Chartered Accountants
31 March 2015
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR SDSFMFFISEFD
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