UK-based online fashion retailer ASOS Plc has reported adjusted gross margin of 40.3 per cent in the first half of fiscal 2024 (H1 FY24), a decline from 42.9 per cent in H1 FY23. The company's adjusted group revenue fell by 18 per cent to £1.49 billion (approximately $1.85 billion) compared to £1.83 billion in the same period last year.

ASOS's earnings before interest, taxes, depreciation, and amortisation (EBITDA) turned negative, registering a loss of £16.3 million, a stark contrast to the £4.6 million gain seen in H1 FY23. The adjusted earnings before interest and taxes (EBIT) worsened, deepening to a loss of £98.1 million from a loss of £69.4 million in the previous year, the company said in a press release.

The company's adjusted loss before tax widened significantly to £120 million, down from £87.4 million, reflecting a decrease of £32.6 million year on year. Despite these challenges, ASOS reported some positive news in terms of its balance sheet, with net debt improving to £348.8 million, down from £431.7 million, a reduction of £82.9 million.

The report also highlighted a substantial reduction in free cash outflow, which improved by £237.7 million to £21.1 million from a previous £258.8 million.

Looking at statutory measures, group revenue stood at £15 billion, down 18 per cent from £1.8 billion. The gross margin under statutory measures increased by 390 basis points to 40 per cent from 36.1 per cent. The operating loss saw an improvement, decreasing to £246.8 million from £272.5 million, and the loss before tax was reduced by £20.9 million to £270 million.

"At the beginning of this year we explained that FY24 would be a year of continued transformation for ASOS as we take the necessary actions to deliver a more profitable and cash generative business. Under our Back to Fashion strategy, we set out three priorities for the year—to offer the best and most relevant product, to strengthen our relationship with customers and to reduce our cost to serve," said Jose Antonio Ramos Calamonte, chief executive officer.

Fibre2Fashion News Desk (DP)

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