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ASOS Plc Q1 Sales Climb, Margin Down; Cuts FY19 Forecast - Quick Facts

British online fashion and cosmetic retailer ASOS plc (ASOMY.PK,ASOMF.PK,ASC.L) reported Monday that its first-quarter total group revenue climbed 14 percent to 656 million pounds from last year's 576.7 million pounds. At constant currency rates, revenue grew 13 percent.

Total retail sales increased 13 percent on a reported basis and 12 percent at constant currency to 640 million pounds.

UK retail sales grew 19 percent to 237.1 million pounds, and international retail sales went up 11 percent to 402.9 million pounds.

EU sales grew 18 percent and US sales grew 13 percent, while rest of the world sales fell 3 percent.

Total orders placed were 17.1 million, up 16% from last year.

Retail gross margin, meanwhile, dropped 160 basis points.

Looking ahead, ASOS noted that despite the strong revenue growth, it experienced a significant deterioration in the important trading month of November and conditions remain challenging.

As a result, the company has reduced expectations for the current financial year.

For the current financial year to August 2019, the company now expects sales growth of about 15%, compared to previous estimate of growth of 20 percent to 25 percent.

Retail gross margin is now expected to be down 150 basis points, compared to previous estimate of flat at 49.9 percent. EBIT margin is now expected to be about 2 percent, down from previous estimate of about 4 percent.

Nick Beighton, CEO, said, "We achieved 14% sales growth in a difficult market, but in the light of a significant downturn in November, we think it's prudent to recalibrate our expectations for the full year. We are taking all appropriate actions and our ambitions for ASOS have not changed."

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