Slowdown in sales going according to plan: Asos

ONLINE fashion retailer Asos yesterday revealed a continued slowdown in UK sales growth but insisted that the declining figures were all part of its strategy for more "normalised" growth.

The firm said its 30 per cent rise in sales during the five weeks to 3 January – which was down from a 46 per cent increase in the seven weeks to 15 November – was according to plan.

Chief executive Nick Robertson said: "It is a slowdown but this is what we're planning to do. This is going to be a more normalised rate of growth, 30 per cent is a phenomenal achievement in the current climate."

Asos, which stands for As Seen on Screen, said its warehouse and systems would not have been able to withstand another doubling of sales.

"You can't deliver 50 per cent growth if you haven't got 50 per cent more stock … I had 30 per cent more stock so I delivered 30 per cent more sales," Robertson said.

He insisted that Asos, which specialises in replicating celebrity outfits but for a fraction of the price, had still pulled off "the best retail performance out of any retailer" over the festive period.

However, the City was unconvinced with Matthew McEachran of Singer Capital pointing out that sales growth had come in at the lower end of expectations and stockbroker Charles Stanley reiterated its "sell" recommendation on the shares. Asos yesterday closed down 7.1 per cent at 435p.

The online specialist, which last night commenced sponsorship of the cable television programme Next Top Model, said international business is growing fast, with non-UK sales now accounting for a quarter of turnover. Asos is soon to launch a US-specific website.

Despite the slowing UK sales growth, the group is still expected to boost sales from 165m to about 230m during this financial year.