Asos plans to expand on 44% profit hike

Chief executive Nick Robertson said the trend towards internet shopping among young consumers was "bigger than the economic cycle".

Asos, which stands for As Seen On Screen – sells both designer and high-street fashion and allows buyers to design a look inspired by celebrities such as Kate Moss, Sienna Miller and Alexa Chung.

Profits leapt to 20.3 million in the year to March but the company said sales could have been higher. The group said fears of a consumer slump had led to the company being "under potentialised".

International sales almost doubled to 63m, while UK sales rose 20 per cent to 160m, the company said.

Robertson said: "It is too early to assume that these trading levels represent a sustainable trend. However, we have entered the year with much more confidence,"

The chief executive said the group was overly cautious with stock levels last year and added that a 58 per cent hike in sales since the year-end confirmed the resilience of its customer base. Asos now plans to expand its distribution capacity and yesterday signed a lease on a 1.2 million square foot "mega shed" in Barnsley – which will have initial capacity for 600m of annual sales after an investment of 20m this year.

The firm is launching a US website this September, with France and Germany to follow later in the year.

Shares in Asos, which have risen 39 per cent over the last quarter, closed up 95.5p, or 15 per cent, at 728p, valuing the company at 544m

However, Ramona Tipnis of Oriel Securities said shares were overvalued. "They are talking about becoming a 1bn business. Growth has to be delivered and it is going to cost."