Information  X 
Enter a valid email address

ASOS PLC (ASC)

  Print      Mail a friend       Annual reports

Thursday 24 May, 2012

ASOS PLC

Final Results

RNS Number : 9871D
ASOS PLC
24 May 2012
 



                                                                                                                                           

24 May 2012

ASOS plc

Global Online Fashion Store

Audited Final Results for the year ended 31 March 2012

 

 

Summary results table

£'000s

2012

2011

Change

Group revenues1

339,691

46%

Retail sales

481,562

324,100

49%

  UK retail sales

197,859

184,072

7%

  International retail sales

283,703

140,028

103%

Gross profit2

251,970

166,649

51%

  Retail gross margin

49.5%

46.6%

290bps

  Gross margin

50.9%

49.1%

180bps

Profit before tax and exceptional items

40,934

28,648

43%

Profit before tax

30,349

15,705

93%

Diluted underlying earnings per share3

36.3p

25.6p

42%

Diluted earnings per share4

26.7p

13.7p

95%

Net funds5

19,315

4,679

313%

1Includes retail sales, delivery receipts and third party revenues

2 Distribution costs have been reclassified from cost of sales to operating expenses from 1 April 2011. Comparative information has been reclassified accordingly

3Underlying earnings per share has been calculated using profit after tax but before exceptional items

4Earnings per share has been calculated using profit after tax and exceptional items of £22.3m (2011: £10.8m)

5Cash and cash equivalents less bank borrowings

 

Highlights:

·      Retail sales up 49% (UK retail sales up 7%, International retail sales up 103%)

·      Retail margin up by 290bps and gross margin up by 180bps year on year

·      International retail sales accounted for 59% of total retail sales (2011: 43%) and 62% in Q4

·      Profit before tax and exceptional items up 43% to £40.9m

·      Tight stock management and strong net funds of £19.3m

·      New websites launched in Italy, Spain and Australia

·      Warehouse transition completed and delivering significant efficiency gains

 

 

Nick Robertson, CEO, commented:

 

"I am pleased to report another strong year for ASOS, with retail sales up 49% to £481.6m and profit6 up 43% to £40.9m.

 

During the year, we successfully launched country specific sites in Australia, Spain and Italy. We completed the year with further penetration into existing international markets and substantial expansion into new territories. Additionally our successful transition to a new 530,000 sq ft warehouse in Barnsley became fully operational in June 2011.

 

We remain positive in our outlook for 2012/13 as we continue our journey to becoming the world's number one online fashion destination. Our International roll out continues and our 1:5:5 ambitions for the company are in sight."

 

6 Profit before tax and exceptional items

 

Investor and Analyst Meeting

There will be a meeting for investors and analysts that will take place at 10am today, 24 May 2012, in The Finsbury Theatre, 4 Chiswell Street, Finsbury Square, London, EC1Y 4UP. A live webcast will be available at www.asosplc.com.

For further information:

ASOS plc

Tel: 020 7756 1017

Nick Robertson, Chief Executive


Nick Beighton, Finance Director


Greg Feehely, Head of Investor Relations


Website: www.asos.com


College Hill

Tel: 020 7457 2020

Matthew Smallwood / Justine Warren / Jamie Ramsay


JPMorgan Cazenove 

Tel: 020 7742 4000

Luke Bordewich / Gina Gibson


Numis Securities

Tel: 020 7260 1000

Alex Ham


 

Background note

ASOS.com is a global online fashion and beauty retailer and offers on the ASOS.com website over 50,000 branded and own label product lines across womenswear, menswear, footwear, accessories, jewellery and beauty.  ASOS has websites targeting the UK, USA, France, Germany, Spain, Italy and Australia and also ships to over 190 other countries from its central distribution centre in the UK.

Aimed at fashion forward twenty-somethings globally, ASOS attracts 17.5 million unique visitors a month and as at 31 March 2012 had 8.0 million registered users and 4.4 million active customers from 160 countries (defined as having shopped in the last 12 months).

www.asos.com 

www.us.asos.com

www.asos.de

www.asos.fr

www.asos.com/au

www.asos.it

www.asos.es

m.asos.com

marketplace.asos.com

fashionfinder.asos.com

 

ASOS plc ("the Group")

Global Online Fashion Store

Final Results for the year ended 31 March 2012

Business Review

 

We have had another successful year, with Group revenues up 46% to £495.0m (2011: £339.7m) and profit before tax and exceptional items up 43% on the prior year at £40.9m (2011: £28.6m). Profit before tax, which includes one-off costs relating to the warehouse transition, increased £14.6m to £30.3m (2011: £15.7m).

Total retail sales grew 49% to £481.6m (2011: £324.1m). The key driver of retail sales growth continues to be our International business (up 103%), although UK growth remains solid with sales up 7% on last year. The international portion of our retail sales mix has continued to increase during the year and accounted for 59% of total retail sales (2011: 43%).

Our retail gross margin improved by 290bps in the year and our overall gross margin improved by 180bps to 50.9% (2011: 49.1%). Our rapid and profitable global expansion continues with the launch of three new country websites over the period in Australia, Spain and Italy, as well as the establishment of our first overseas marketing office in Australia. We also continued our investment in our global free shipping proposition.  The next stage in our international development is to introduce other small in-country teams to amplify our marketing efforts in the countries where we have websites. 

 

We remain committed to our goal of achieving £1bn sales from five major markets by 2015. All our International markets are performing strongly and our unique position on the global stage of Internet apparel retailers is now firmly established. We are the second most visited apparel site on the planet on a daily basis (for 15-34 year olds) and as at March 2012, 69% of our traffic is derived from outside the UK, up from 58% a year ago.

 

Products

We are committed to establishing ASOS as the world's number one online fashion destination for twenty-somethings.  We continuously refine our product range and our pricing architecture to ensure it is focused on the fashion minded twenty-something.  That requires ASOS to be increasingly diligent in areas such as sourcing and markdown management as well as continually augmenting our retail disciplines to deliver gross margin efficiency that subsequently can be reinvested in customer proposition and / or pricing, as appropriate.  We believe in our product collections offering greater value to the ASOS customer relative to the marketplace, whilst refusing to compromise on fashionability or product quality. 

 

During the last financial year, 'ASOS' own-label brand firmly established its own credentials as a global fashion brand.  Whilst the sale of third party brands remains important both to ASOS and our customers, the 'ASOS' own-label brand provides us with a unique offering that is sought after both in the UK and even more so internationally.  Sales of the 'ASOS' own-label brands now account for c55% of total sales, up 100bps from the previous year, and we continue to invest in the price points and quality to support this growth.

 

Menswear grew particularly strongly (up c60%) and is helping to diversify the Group's revenue streams.  Whilst demanding different styles and approaches, fashion is just as important to twenty-something men as to their female counterparts and ASOS is increasingly becoming a destination of choice for that audience.  Womenswear is a more competitive market, which demands that ASOS is at the top of its game from a fashion, buying and merchandising and marketing perspective. During the course of the year we have restructured and refocused our pricing architecture which commenced in March 2012. Our global customer base will benefit from this through the course of the current year.

 

Management

Our Chairman, Lord Waheed Alli, has notified the Board of his intention to step down and leave the Company once his successor has been identified. Waheed has been with the company for 12 years during which time he has played an important role. As such we are all immensely grateful to him. The search for his successor is currently underway.

During the year, we made significant investment to further strengthen our management capabilities in order to seize upon as many of the opportunities available to the Group as possible.  From a senior management perspective, in the last 12 months ASOS has hired a new People & Services Director, Trading Director, General Counsel & Company Secretary and Head of Investor Relations to supplement the existing management capability.  These efforts will continue and we will look to strengthen both our supply chain and sourcing resource, amongst other areas, to ensure that the executive team has the diversity of skills, mind-sets and capabilities which the business needs to thrive and to support our rate of growth.  In addition to these people changes, we replaced our legacy buying and merchandising system with a tier one solution and over 235 new staff were recruited over the period, principally in our Retail, International, Customer Care and IT departments.

 

Operations

Investment in operations also took place during the year as we continue to refine and develop ASOS's strong business model.  We have continued our investment in returns and delivery.  We introduced a new third party operated returns hub in Sydney which has improved delivery times even further.  New improved delivery times are most notable in the US where we have speeded up the delivery for our customers by 2 days.

 

Additionally, several capacity enhancing initiatives were delivered over the period. Our logistical constraints were removed by our re-location to the new single state-of-the-art distribution facility in Barnsley. Cost and time efficiencies from that investment are already being realised and we believe there will be more to come as we gain more understanding of the opportunities this facility offers.  This new facility will more than satisfy our capacity requirements for the foreseeable future and support our £1bn sales goal.  

 

Over the past four years we have invested over £35m in ensuring that our technology is of the highest standard and state-of-the-art. We know our customers value the depth and breadth of choice that online operations can offer.  We aim to improve the ease of shopping through our sites, which is why we are committed to technology re-platforming. We are intent on driving our technology to become device agnostic, so that customers can browse from their laptop, desktop, mobile, iPad or Android device on a 24/7 basis, wherever they are.  Work is also underway to enable the ASOS platform, both front and back end, to handle all language character sets rather than just western.  A quicker, but less efficient, route to market would have been to build these sites independently however that would have resulted in a number of separate platforms for countries such as China and Russia.  Developing the single ASOS platform will provide a better and more effective solution in the long term. Progress continues in building the infrastructure, on the previously indicated timeframe.

 

Our strategy of 'shop to destination' continues with both our Marketplace and Fashion Finder sites significantly enhancing the ASOS customer experience.  During the year we rolled out Marketplace to our International sites and now promote product from a number of international boutiques.  We also launched the ASOS Magazine and shopping apps to exploit the growing trend of mobile browsing; 16% of ASOS traffic is now via mobile.  We see the role of ASOS to be much more than a shop; it is also a key part of the fashion media and is a technical enabler of all things fashion, competing for a percentage of our twenty-something customer's time as well as an increasing percentage of their fashion purse.  A number of initiatives are planned over the coming months to continue to deliver on this goal.

 

Trading operations

 

The Group has achieved another strong performance during 2012 with sales and profit growth across all territories, particularly internationally. International sales now account for 59% of total retail sales compared to 43% in the previous year. 

 

Revenue

£'000s

UK

International

Group Total

USA

EU

RoW

Total

Retail sales

197,859

39,959

106,993

136,751

283,703

481,562

Growth

7%

114%

46%

185%

103%

49%








Delivery receipts

7,073

825

1,449

1,430

3,704

10,777

Growth

4%

30%

(53%)

(44%)

(41%)

(18%)








Third party revenues

2,555

10

25

28

63

2,618

Growth

2%





4%








Group revenues

207,487

40,794

108,467

138,209

287,470

494,957

Growth

7%

112%

42%

173%

96%

46%

 

Total Group revenue increased 46%, with total retail sales up 49% on last year, driven by 103% growth in our International retail sales. In the final quarter, we annualised our investment in global free shipping which led, as anticipated, to lower year on year International sales growth, at 63% in the final quarter.  

 

The Rest of the World segment was the fastest growing segment within retail sales at 185%, boosted by strong sales from Australia (where we have maintained our first place Comscore position), Russia, Singapore and China amongst others. We introduced a country specific Australian website midway through the year, which has contributed to the strong growth in this territory and have recently opened a small marketing office in Sydney. Growth in our other territories was also driven by a full year's contribution from our other country specific websites in the USA, France and Germany, introduced in autumn 2010, together with our Italian and Spanish websites which were introduced in September 2011. All seven country-specific sites are performing well, with visitors, orders and average selling price significantly up year on year. Based on Comscore data, we have risen in the USA to 29th at March 2012 (March 2011: 37th), in Germany to 17th (March 2011: 26th), and in both Spain and Italy we are ninth.

 

Despite the challenging economic environment facing all of our customers, particularly in the UK, retail sales grew in the UK by 7% in the period and according to Comscore, we remain first in the UK for the 15-34 age range.

 

As anticipated, delivery receipts reduced year on year by 18% due to the continued investment in our global free ship delivery proposition. This annualised in the USA in August 2011 and in the rest of the world in January 2012, leading to an overall decline in international delivery receipts of 41%. In the UK, free style saver delivery has been part of the customer proposition since April 2010 consequently UK delivery receipts increased due to increased retail sales and take-up of ASOS Premier.

Third party revenues, which mainly comprise advertising revenues from the website and the ASOS magazine, increased by 4% in the year to £2.6m.

Trading Key Performance Indicators

 

Active customer numbers increased in all our markets year on year with total numbers up by 38%, to c4.4 million. ASOS now has as many International active customers as it does in the UK, which demonstrates the extent of our International expansion, but there is still significant opportunity within the global twenty-something market. The number of orders also increased by 52% and average product selling price was up 4%. The declines in average basket value of 6% and average units per basket of 9% are in line with expectations and are a direct consequence of our investment in global free delivery to drive future growth and also frequency of purchase.

 



International


 

KPIs

UK

USA

EU

RoW

Total

Group Total

Average basket value1

£65.11

£59.23

£63.10

£61.99

£62.03

£63.58

Growth

1%

(4%)

(15%)

(27%)

(17%)

(6%)








Average units per basket

2.25

2.23

2.42

2.55

2.44

2.35

Growth

(7%)

(6%)

(17%)

(27%)

(18%)

(9%)

 

Average selling price per unit1

£28.88

£26.57

£26.11

£24.35

£25.42

£27.09

Growth

8%

2%

3%

-

1%

4%

 

Number of orders ('000)

5,937

927

2,532

2,415

5,874

11,811

Growth

10%

141%

80%

286%

143%

52%








Unique visitors ('000) 2






17,500

Growth






35%








Total visits ('000) 2

14,656

6,060

13,796

12,648

32,504

47,160

Growth

(3%)

65%

34%

77%

54%

30%








Active customers ('000) 3

2,190

445

1,000

740

2,185

4,375

Growth

5%

109%

63%

190%

102%

38%

1Including VAT

2 During March 2012

3As at 31 March 2012 defined as having shopped with ASOS during the last 12 months

 

Gross profit

 

The Group generated gross profit of £252.0m (2011: £166.6m), up 51% on last year.

 

£'000s

UK

International

Group Total

USA

EU

RoW

Total

Gross profit

99,173

24,698

54,514

73,585

152,797

251,970

Growth

9%

126%

44%

177%

103%

51%








Retail gross margin

45.3%

59.7%

49.6%

52.7%

52.5%

49.5%

Change

70bps

450bps

220bps

280bps

320bps

290bps








Gross margin

47.8%

60.5%

50.3%

53.2%

53.2%

50.9%

Change

60bps

380bps

80bps

80bps

170bps

180bps

Note: From 1 April 2011, the Group has reclassified delivery costs from cost of sales to operating expenses to reflect their increasing deployment as a marketing expenditure. Prior year comparatives have been reclassified accordingly.

 

The Group retail gross margin increased by 290bps to 49.5% (2011: 46.6%) as a result of improved buying and markdown management as we continue to improve our retail disciplines, as well as the increase in the mix of International sales, which have a stronger margin due to a higher mix of own brand purchases. Gross margin improved by 180bps to 50.9% (2011: 49.1%) as the improvements in retail margin were offset by the reduction in delivery receipts.

 

Investment in our operating resources

 

The Group increased its investment in its operating resources and capability by 53% to £210.2m, excluding exceptional items. Total operating costs ratio improved by 110bps excluding investment in our customer delivery proposition.

 

£'000s

2012

2011

Change

Distribution costs

65,840

34,959

88%

Payroll and staff costs

46,726

35,717

31%

Warehousing

32,317

22,543

43%

Marketing

19,728

14,280

38%

Production

3,347

2,621

28%

Technology costs

10,074

5,629

79%

Other operating costs

24,080

17,118

41%

Depreciation

8,074

4,932

64%

Operating costs excluding exceptional items

210,186

137,799

53%

Operating costs excluding delivery costs and exceptional items

144,346

102,840

40%

% of sales excluding distribution costs

29.2%

30.3%

110bps

 

Delivery and returns solutions are a cornerstone of our international growth strategy and customer proposition. As a result we continued to invest in our delivery proposition and in particular our global free shipping commitment. Distribution costs have, as a result, increased by 88% year on year due to increased order numbers and in particular International orders.

 

Payroll and staff costs have increased by 31%, as we continue to benefit from economies of scale and deliver operating cost leverage. We continued to invest in headcount in our key areas of IT, Retail and International as well as expanding our Customer Care resources to service our increasing global customer base.

 

The transition to our new warehouse in Barnsley was another milestone for ASOS and was completed on time with minimal customer service disruption. The warehouse operation is already achieving significant efficiency gains, despite limited changes to the labour intensive operating model of the previous warehouse, through the benefits of greater scale and productivity improvements. In addition, during the year, we introduced a further local returns solution in Sydney, Australia, operated by a third party and designed to service our customers in this country more efficiently.

Technology costs have increased by 79% on prior year to £10.1m as a result of our continued investment in underlying infrastructure and innovation, as in previous years. The increase in other operating costs during the year was driven by increased credit card handling fees resulting from the number of transactions processed and increased property costs from additional head office space acquired in the prior year.

 

Group Profit

 

The Group generated profit before tax and exceptional items up 43% on prior year at £40.9m (2011: £28.6m).

 

£'000s

2012

2011

Change

Revenue

494,957 

339,691 

46%

Cost of sales*

(242,987)

(173,042)


Gross profit*

251,970 

166,649 

51%

Distribution costs excluding exceptional items*

(65,840)

(34,959)


Administrative expenses excluding exceptional items

(144,346)

(102,840)


Operating profit before exceptional items

41,784 

28,850 

45%

Share of post tax losses of joint venture

-

(3)


Net finance (costs)/income

(850)

(199)


Profit before tax and exceptional items

40,934 

28,648 

43%

Exceptional items

(10,585)

(12,943)


Profit before tax

30,349

15,705

93%

Income tax expense

(8,070)

(4,856)


Profit after tax

22,279 

10,849 

105%

* From 1 April 2011, the Group has reclassified delivery costs from cost of sales to operating expenses to reflect their increasing deployment as a marketing expenditure. Prior year comparatives have been reclassified accordingly.

 

Exceptional items

 

Exceptional costs of £10.6m reflect the remaining direct costs of the transition to our new warehouse which is now completed and fully operational. This includes dual site decollation costs, relocation costs, staff training, and vacant property costs on our legacy warehouses, as well as an impairment charge of £2.8m. The impairment charge relates to assets in our legacy warehouse which were classified as held-for-sale at 31 March 2011 at their net realisable value of £2.8m based on an independent valuation. No buyer has been found for these assets during the year to 31 March 2012, therefore these assets have been impaired to a carrying value of £nil.

The cash outflow during the year as a result of exceptional costs was £10.2m.  

The main components of the exceptional charge to the profit and loss account are as follows:

£'000s


2012

2011

Dual site decollation costs*


5,385

2,088

Pre go-live occupancy and employee costs


965

7,830

Vacant property costs


1,435

-

Impairment of assets


2,800

3,025

Total


10,585

12,943

* Included within dual site decollation costs are delivery costs of £2,258,000 (2011: £nil) which have been classified within distribution expenses in the statement of comprehensive income. The remaining exceptional costs have been included within administrative expenses.

Taxation

The effective tax rate (pre exceptional items) for the Group was 26.1%, 300bps lower than last year.  Including exceptional items the effective tax rate was 26.6% (2011: 30.9%). Going forward, we would expect the effective rate of tax pre exceptional items to be around 1% higher than the prevailing UK corporation tax rate.

 

Earnings per share

 

Basic underlying earnings per share1 increased by 46% to 39.8p per share (2011: 27.3p), and diluted underlying earnings per share1 increased by 42% to 36.3p per share (2011: 25.6p).

 

Basic earnings per share2 increased by 101% to 29.3p per share (2011: 14.6p), and diluted earnings per share2 increased by 95% to 26.7p per share (2011: 13.7p).

 

The dilution calculation includes 2.0m shares to be issued under the Management Incentive Plan ("MIP") in September 2012 and 2.0m shares to be issued under the MIP in September 2013, according to TSR and EPS performance criteria achieved at the end of the scheme's performance period (3 years ended 31 March 2012). 

 

1 Underlying earnings per share has been calculated using profit after tax but before exceptional items.

2 Earnings per share has been calculated using profit after tax and exceptional items.

 

Dividend

 

The Board is of the opinion that shareholder's interests are best served by continuing to reinvest the cash generated by the business to exploit the substantial global growth opportunities both in the UK and Internationally. Accordingly, it has decided not to pay a dividend for the year ended 31 March 2012. This policy remains under regular review.

 

 

Statement of Financial Position

 

The Group has a strong financial position including a strong cash balance and a clean stock position. Net assets increased by £23.1m to £95.2m (2011: £72.1m), driven by the increase in profit after tax for the period.  

 

Statement of Cash Flows

 

The Group's cash balance was £24.3m at 31 March 2012, up from £4.7m at 31 March 2011. Net funds were £19.3m (31 March 2011: £4.7m). The summary cash flow is detailed below.

 

£'000s

2012

2011

Operating profit

31,199

15,907

Exceptional items

10,585

12,943

Operating profit before exceptional items

41,784

28,850

Depreciation and amortisation

8,074

4,932

Working capital

(3,866)

(7,541)

Share based payments charges

648

1,165

Tax received/(paid)

1,012

(5,509)

Cash in/(out)flow from operating profit before exceptional items

47,652

21,897

Operating cash outflow relating to exceptional items

(10,152)

(6,615)

Cash in/(out)flow from operating profit

37,500

15,282

Capital expenditure

(21,587)

(25,743)

Proceeds from issue of ordinary shares

593

1,100

Net purchase of own shares by Employee Benefit Trust

(1,592)

(1,406)

Drawdown of revolving credit facility

5,000

-

Net interest (paid)/received

(278)

(199)

Total cash in/(out)flow

19,636

(10,966)

 

Cash generated from operating profit increased by £22.2m, as a result of an increase in operating profit before exceptional items of £12.9m, an improvement of £3.6m in cash flows from working capital and a favourable variance in corporation tax cash flows of £6.5m.

 

The Group has continued to monitor working capital tightly, resulting in an improvement in the cash outflow from working capital from £7.5m to £3.9m. The working capital movement is primarily as a result of tighter stock management.

 

Capital expenditure was £21.6m, £4.2m lower than last year. The Group had drawn down £5.0m under its revolving credit facility agreement at year end.

 

Our investments are funded by operating cash flows, with additional short term and medium term facilities to support working capital movement and planned capital expenditure. At 31 March 2012, the Group had in place a £10.0m revolving credit facility which is available until February 2013.

 

Fixed asset additions

£'000

2012

2011

IT

15,874

9,726

Office fixtures and fit-out

2,157

977

Warehouse

3,274

17,781

Total

21,305

28,484

 

The majority of fixed asset additions were related to improvements in our IT infrastructure. The main areas of investment were on our new buying and merchandising system which launched in September 2011, underlying infrastructure improvements and on our three new international websites. We have invested £3.3m in the new distribution centre during the year.

 

Change in accounting reference date

As announced on 26 April 2012, the Group has changed its accounting reference date and financial year end from 31 March to 31 August. The Board took this decision to enable the Company's external reporting period to align with the buying seasons of the fashion industry. The Board will report its next audited results for the 5 month period to 31 August 2012 by the end of October 2012.

 

Outlook

We remain positive in our outlook for 2012/13 as we continue our journey to becoming the world's number one online fashion destination. Our International roll out continues and our 1:5:5 ambitions for the Group are in sight.

 

 

 

Nick Robertson                                                             Nick Beighton

Chief Executive Officer                                                     Finance Director

 

Audited Consolidated Statement of Comprehensive Income

For the year ended 31 March 2012

 


Year to 31 March 2012

Year to 31 March 2011

Reclassified1


Before exceptional items

Exceptional items

Total

Before exceptional items

Exceptional items

Total


£'000

£'000

£'000

£'000

£'000

£'000








Revenue

494,957

-

494,957

339,691

-

339,691

Cost of sales

(242,987)

-

(242,987)

(173,042)

-

(173,042)








Gross profit

251,970

-

251,970

166,649

-

166,649








Distribution expenses

(65,840)

(2,258)

(68,098)

(34,959)

-

(34,959)

Administrative expenses

(144,346)

(8,327)

(152,673)

(102,840)

(12,943)

(115,783)








Operating profit

41,784

(10,585)

31,199

28,850

(12,943)

15,907

Share of post tax losses of joint venture

-

-

-

(3)

-

(3)








Finance income

-

-

-

16

-

16

Finance expense

(850)

-

(850)

(215)

-

(215)








Profit before tax

40,934

(10,585)

30,349

28,648

(12,943)

15,705








Income tax (expense)/credit

(10,685)

2,615

(8,070)

(8,337)

3,481

(4,856)








Profit after tax and total comprehensive income attributable to owners of the parent

30,249

(7,970)

22,279

20,311

(9,462)

10,849

 

 

 

 

Earnings per share2

 





 

Basic




29.3p 



14.6p

Diluted




26.7p 


13.7p









 

Underlying earnings per share3

 




Basic


39.8p 



27.3p 



Diluted


36.3p 



25.6p 



 

 

 

1 Distribution costs have been reclassified from cost of sales to operating expenses from 1 April 2011. Comparative information has been reclassified accordingly (note 1).

2 Earnings per share is calculated in accordance with IAS 33 'Earnings per share' and includes exceptional items.

3 Underlying earnings per share excludes exceptional items.

 

Audited Consolidated Statement of Changes in Equity

For the year ended 31 March 2012

 

 

 


Called up share capital

   Share premium

Retained earnings1

Employee Benefit Trust reserve

Total

equity

 



£'000

£'000

£'000

£'000

£'000

 








Balance as at 1 April 2010


2,617

4,138

41,920

(3,197)

45,478

 








 

Shares allotted in the year


44

1,056

-

-

1,100

 

Purchase of shares by Employee 

Benefit Trust


 

-

 

-

 

-

 

(1,406)

 

(1,406)

 

Employee share schemes


-

-

(163)

1,328

1,165

 

Total comprehensive income


-

-

10,849

-

10,849

 

Deferred tax on share options


-

-

10,199

-

10,199

 

Current tax on items taken directly to equity

 

 

 

-

 

-

 

4,735

 

-

 

4,735

 








 

Balance as at 31 March 2011


2,661

5,194

67,540

(3,275)

72,120

 

 

Shares allotted in the year


38

555

-

-

593

Purchase of shares by Employee

Benefit Trust


 

-

 

-

 

-

 

(1,592)

 

(1,592)

Employee share schemes


-

-

(1,287)

1,935

648

Total comprehensive income


-

-

22,279

-

22,279

Deferred tax on share options


-

-

(6,386)

-

(6,386)

Current tax on items taken directly to equity

 

 

 

-

 

-

 

7,573

 

-

 

7,573








Balance as at 31 March 2012


2,699

5,749

89,719

(2,932)

95,235

 

1Retained earnings includes the share-based payments reserve

 

Audited Consolidated Statement of Financial Position

As at 31 March 2012

 


2012

2011


     £'000

£'000

Non-current assets



Goodwill

1,060

1,060

Other intangible assets

19,959

9,529

Property, plant and equipment

27,694

24,893

Deferred tax asset

9,876

16,877


58,589

52,359




Current assets



Inventories

80,574

66,094

Trade and other receivables

19,503

10,122

Current tax asset

2,018

2,914

Cash and cash equivalents

24,315

4,679


126,410

83,809




Assets of disposal group classified as held for sale

-

2,800




Current liabilities



Trade and other payables

(83,829)

(64,947)

Revolving credit facility

(5,000)

-

Provisions

(935)

(1,901)


(89,764)

(66,848)




Net current assets

36,646

19,761




Net assets

95,235

72,120







Equity attributable to owners of the parent



Called up share capital

2,699

2,661

Share premium

5,749

5,194

Employee Benefit Trust reserve

(2,932)

(3,275)

Retained earnings

89,719

67,540




Total equity

95,235

72,120

 

Audited Consolidated Statement of Cash Flows

For the year ended 31 March 2012





31 March

31 March


2012

2011


£'000

£'000




Operating profit

31,199

15,907

Adjusted for:



Operating exceptional items

10,585

12,943

Depreciation of property, plant and equipment

4,937

3,290

Amortisation of other intangible assets

3,137

1,642

Increase in inventories

(14,480)

(28,366)

Increase  in trade and other receivables

(9,381)

(5,119)

Increase in trade and other payables

19,995

25,944

Share-based payments charges

648

1,165

Income taxes received/(paid)

1,012

(5,509)

Net cash generated from operating activities before exceptional items

47,652

21,897

Cash outflow relating to exceptional operating items

(10,152)

(6,615)

Net cash generated from operating activities

37,500

15,282




Investing activities



Payments to acquire other intangible assets

(12,669)

(7,748)

Payments to acquire property, plant and equipment

(8,918)

(17,995)

Finance income

-

16




Net cash outflow used in investing activities

(21,587)

(25,727)




Financing activities



Proceeds from issue of ordinary shares

593

1,100

Purchase of own shares by Employee  Benefit Trust

(1,592)

(1,406)

Drawdown of revolving credit facility

5,000

-

Finance expense

(278)

(215)




Net cash generated/(used) in financing activities

3,723

(521)




Net (decrease)/increase in cash and cash equivalents

19,636

(10,966)




Opening cash and cash equivalents

4,679

15,645

Closing cash and cash equivalents

24,315

4,679

 

 

Reconciliation of net cash flow to movement in net funds/(debt)

 


31 March

31 March


2012

2011


£'000

£'000




Net funds at beginning of the period

4,679

15,645

Increase/(decrease) in cash and cash equivalents

19,636

(10,966)

Increase in net debt

(5,000)

-

Net funds at end of the period

19,315

 4,679

 

Notes to the Financial Information

 

1.  Preparation of the audited condensed consolidated financial information

 

a)   Basis of preparation

 

Whilst the information included in this audited condensed consolidated financial information ("preliminary announcement") has been prepared in accordance with the recognition and measurement criteria of International Financial Reporting Standards ("IFRSs") as adopted for use in the European Union and as issued by the International Accounting Standards Board, this preliminary announcement does not itself contain sufficient information to comply with IFRSs.

 

The financial information contained within this preliminary announcement for the 12 months to 31 March 2012 and 12 months to 31 March 2011 do not comprise statutory financial statements within the meaning of section 434 the Companies Act 2006. The Annual Report and Accounts 2011 have been filed with the Registrar of Companies and those for the 12 months to 31 March 2012 will be filed following the Company's annual general meeting. The preliminary announcement for the 12 months to 31 March 2012 has been prepared on a consistent basis with the financial accounting policies set out in the Accounting Policies section of the ASOS Plc Annual Report and Accounts 2012.

 

The condensed consolidated financial information should be read in conjunction with the Group's Annual Report and Accounts for the year ended 31 March 2012, which have been prepared in accordance with IFRSs as adopted by the European Union. 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 and also highlights the principal risks and uncertainties facing the Group. The Annual Report and Accounts 2012 includes the Group's objectives, policies and processes for managing its capital; its financial risk management objectives; details of its financial instruments; and its exposures to credit risk and liquidity risk.

 

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 despite the current uncertain economic outlook. For this reason, they have continued to adopt the going concern basis in preparing the financial statements.

 

In preparing the preliminary announcement, the Directors have also made reasonable and prudent judgements and estimates and prepared the preliminary announcement on the going concern basis. The preliminary announcement and management report contained herein give a true and fair view of the assets, liabilities, financial position and profit and loss of the Group.

 

b)   Accounting policies

 

The Financial Statements have been prepared in accordance with the accounting policies set out in the 2012 Annual Report and Accounts, except as described below.

 

From 1 April 2011, the Group has reclassified delivery costs from cost of sales to operating expenses to reflect the increasing deployment of delivery costs as a marketing expenditure. Comparative information has been reclassified accordingly. The impact of this reclassification for the year to 31 March 2011 is as follows:

 


Year to 31 March 2011


Reported

Adjustment

Revised

Gross profit

131,690 

34,959 

166,649 

Distribution expenses*

(34,959)

(34,959)

Administrative expenses*

(102,840)

(102,840)

Operating profit

28,850 

28,850 

* Excluding exceptional items

 

With effect from September 2011, the Group has changed its policy for valuation of inventories from a first-in-first-out basis to a weighted average cost basis as this is deemed to more effectively match current costs and current revenues in the statement of comprehensive income. Due to rapid inventory turnover, the impact of this change in valuation basis on the inventory held by the Group at 31 March 2012 is immaterial. The impact on the carrying value of inventories as at 31 March 2011 and 31 March 2010 is immaterial therefore prior year comparatives have not been restated.

 

c) Exceptional items

 

The Group separately identifies and discloses significant one-off or unusual items which can have a material impact on absolute profits. These are termed 'exceptional items' and are disclosed separately in the statement of comprehensive income in order to provide an understanding of the Group's underlying financial performance. Exceptional items are judgemental in their nature and may not be comparable to similarly titled measures used by other companies. Further details of exceptional items are included in Note 3 to this release.

 

 

2. 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 ("CODM").  The CODM has been determined to be the Executive Board.  The Executive Board has determined that the primary segmental reporting format 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 and exceptional items.

 


2012


UK

USA

EU

RoW

Total


£'000

£'000

£'000

£'000

£'000

Revenue

197,859

39,959

106,993

136,751 

481,562 

Delivery Receipts

7,073

825

1,449

1,430

10,777 

Third party revenues

2,555

10

25

28

2,618 

Total revenue

207,487

40,794

108,467

138,209 

494,957 

Cost of sales

(108,314)

(16,096)

(53,953)

(64,624)

(242,987)

Gross profit

99,173

24,698

54,514

73,585

251,970 

Distribution costs

(17,890)

(11,037)

(16,227)

(20,686)

(65,840)

Segment result

81,283

13,661

38,287

52,899

186,130 

Administrative expenses





(144,346)

Operating profit before exceptional items





41,784 

Exceptional items





(10,585)

Finance expense





(850)

Profit before tax





30,349 

 

 




2011

(Reclassified, see note 1)

 



UK

USA

EU

RoW

Total


£'000

£'000

£'000

£'000

£'000

Revenue

184,072

18,642

73,385

48,001

324,100

Delivery Receipts

6,814

634

3,063

2,574

13,085

Third party revenues

2,506

-

-

-

2,506

Total revenue

193,392

19,276

76,448

50,575

339,691

Cost of sales (reclassified)

(102,044)

(8,354)

(38,587)

(24,057)

(173,042)

Gross profit (reclassified)

91,348

10,922

37,861

26,518

166,649

Distribution costs (reclassified)

(15,471)

(3,982)

(8,712)

(6,794)

(34,959)

Segment result

75,877

6,940

29,149

19,724

131,690

Administrative expenses





(102,840)

Operating profit before exceptional items





28,850

Exceptional items





(12,943)

Share of post tax losses of joint venture





(3)

Finance income





16

Finance expense





(215)

Profit before tax





15,705

 

 

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 CODM 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.

 

3. Exceptional items

 

During the year to 31 March 2012, exceptional costs of £10.6 million were charged to operating expenses to reflect the remaining direct costs of the reorganisation of distribution following the leasing of a new distribution centre to meet the increasing capacity needs of the business.

The main components of the exceptional charge are as follows:



Year to

31 March 2012

£'000

Year to

31 March

2011

£'000

 

Dual site decollation costs


5,385

2,088

Pre go-live occupancy and employee costs


965

7,830

Vacant property costs


1,435

-

Impairment of assets


2,800

3,025

Total


10,585

12,943

 

Included within dual site decollation costs are delivery costs of £2,258,000 (2011: £nil) which have been classified within distribution expenses in the statement of comprehensive income. The remaining exceptional costs have been included within administrative expenses.

 

 

4. 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 ASOS.com Limited Employee Benefit Trust are eliminated from the weighted average number of ordinary shares.

 

Diluted earnings per share amounts are 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, adjusted for the effects of potentially dilutive share options.

 


2012

2011


No. of shares

No. of shares

Weighted average share capital



Weighted average shares in issue for basic earnings per share

75,914,855

74,375,042

Effect of dilutive options

7,405,148

4,844,159

Weighted average shares in issue for diluted earnings per share

83,320,003

79,219,201

 


2012

2011


£'000

£'000

Earnings



Underlying earnings attributable to shareholders

30,249

20,311

Exceptional items net of related taxation

(7,970)

(9,462)

Earnings attributable to shareholders

22,279

10,849





2012

2011


pence

Pence

Basic earnings per share



Underlying earnings per share (note i)

39.8

27.3

Exceptional items net of taxation

(10.5)

(12.7)

Earnings per share (note ii)

29.3

14.6





2012

2011


Pence

Pence

Diluted earnings per share



Underlying earnings per share (note i)

36.3

25.6

Exceptional items net of taxation

(9.6)

(11.9)

Earnings per share (note ii)

26.7

13.7

 

 

i) Underlying earnings per share has been calculated using profit after tax but before exceptional items.

ii) Earnings per share has been calculated using profit after tax and exceptional items.

 

The dilution calculation includes 2.0m shares to be issued under the MIP in September 2012 and 2.0m shares to be issued under the MIP in September 2013, according to vesting criteria achieved on 31 March 2012, the end of the scheme's performance period.

 

 

5. Analysis of net debt

 



2012

£'000

2011

£'000

 

Net movement in cash and cash equivalents


19,636

(10,966)

Cash flow from drawing of revolving credit facility


(5,000)

-

Net movement in net funds


14,636

(10,966)

Opening net funds


4,679 

15,645

Closing net funds


19,315

4,679





Closing net funds comprises:




Cash and cash equivalents


24,315

4,679

Drawings under revolving credit facility


(5,000)

-

Net funds


19,315

4,679

 

The revolving credit facility of £10.0m, of which £5.0m was drawn at 31 March 2012, is available until February 2013.

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
END
 
 
FR UOVNRUVAVUAR