Interim Results for the six months ended 29 February 2016 12 April - PowerPoint PPT Presentation

Interim Results for the six months ended 29 February 2016 12 April 2016 1

Nick Beighton CEO 2

HY 2016 Highlights • Total sales +21%, PBT £21.2m • Continued acceleration • Strong peak trading performance • Accelerated reinvestment into prices, delivery propositions and customer experience • Logistical / Tech initiatives • Key projects delivering • Mobile growth continues; now representing >60% of traffic • 1 million new customers / Strong KPI’s • Enhanced geographical focus 3

Helen Ashton CFO 4

Financial Highlights CCY 2 £m 1 HY16 HY15 Change Change Group revenues 3 667.3 550.5 21% 25% Retail sales 648.6 536.4 21% 24% UK retail sales 289.5 231.4 25% 25% International retail sales 359.1 305.0 18% 24% Gross profit 324.8 265.2 22% Retail gross margin 47.2% 46.8% 40bps Gross margin 48.7% 48.2% 50bps Profit before tax 4 21.2 18.0 18% Diluted earnings per share 18.3p 17.6p 4% Adjusted diluted earnings per share 5 20.3p 17.6p 15% Cash and cash equivalents 135.9 64.9 109% 1 All numbers subject to rounding 2 On a constant currency basis 3 Includes retail sales, delivery receipts and third party revenues 4 For the six months to 28 February 2015, profit before tax includes net insurance reimbursements of £6.3m in respect of a warehouse fire in the prior financial year which were reinvested in our international pricing proposition 5 Adjusted diluted EPS removes the one- off increase in the Group’s effective tax rate due to the release of our deferred tax asse t in relation to China as this entity's losses will no longer be offset against future profits 5

Sales Growth by Segment Group International HY16 (£m) total UK US EU RoW total Retail sales 648.6 289.5 76.8 167.9 114.4 359.1 Growth 21% 25% 41% 23% - 18% Growth at constant exchange rate 24% 25% 34% 31% 10% 24% Delivery receipts 16.1 7.2 2.7 3.2 3.0 8.9 Growth 37% 33% 72% 42% 19% 40% Third party revenues 2.6 2.4 0.1 - 0.1 0.2 Growth 13% 4% 100% - 100% 100% Total revenues 667.3 299.1 79.6 171.1 117.5 368.2 Growth 21% 25% 42% 24% 1% 18% Growth at constant exchange rate 25% 25% 35% 31% 11% 24% Group HY Retail Sales 55% 57% 61% 45% 43% 39% H1 2014 H1 2015 H1 2016 International UK 6

Gross Profit Performance Group International HY16 total UK US EU RoW total Gross profit (£m) 324.8 138.7 47.7 79.2 59.2 186.1 Growth 22% 30% 46% 18% 2% 18% Retail gross margin 47.2% 44.6% 58.6% 45.3% 49.0% 49.3% Growth 40bps 170bps 140bps (250bps) 40bps (50bps) Gross margin 48.7% 46.4% 60.0% 46.3% 50.4% 50.2% Growth 50bps 160bps 160bps (230bps) 60bps (30bps) Retail gross margin movement 0.7% (0.8%) 1.3% (0.4%) (0.4%) 47.2% 46.8% HY 2015 Full price mix Sourcing gains Price investments UK/International mix Own Brand/Branded HY 2016 mix 7

Group Operating Expenses Bridge 50bps improvement in operating costs to sales ratio driven by improved warehousing efficiency offset by expanded customer proposition 8

Statement of Comprehensive Income HY16 HY15 £m Change Revenue 21% 550.5 667.3 Cost of sales (342.5) (285.3) Gross profit 22% 265.2 324.8 Distribution expenses (78.8) (24%) (97.5) Administrative expenses (174.7) (18%) (206.3) Net other income 6.3 - Operating profit 18.0 17% 21.0 0.2 Net finance income - Profit before tax 21.2 18% 18.0 Income tax expense (6.0) (3.7) Profit after tax 15.2 6% 14.3 Effective tax rate 28.3% 20.7% 760bps 9

Statement of Financial Position At At 29 February 31 August £m 2016 2015 Goodwill and other intangible assets 92.9 76.2 Property, plant and equipment 66.9 64.4 Derivative financial assets - 0.2 Deferred tax asset 2.3 - Non-current assets 162.1 140.8 Stock 198.0 193.8 Net current payables (235.6) (214.5) Cash and cash equivalents 135.9 119.2 Derivative financial (liabilities)/assets* (36.9) 6.1 Current tax (liability)/asset (5.2) (3.6) Deferred tax asset/(liability) 0.9 (4.5) Net assets 219.2 237.3 *Liability position as at 29 February 2016 is as a result of valuing all outstanding forward contracts to market spot rates as per accounting standard requirements 10

Cash Flow £m 14.1 (31.9) 14.9 21.0 (1.4) 135.9 119.2 Opening cash EBIT Depreciation & Working Capex Other * Closing cash amortisation capital * Includes share-based payments, purchase of shares by Employee Benefit Trust, issue of share capital, net interest received, tax paid and other non-cash items. 11

Capital Expenditure £80m £65m £49m FY 2014 FY 2015 FY 2016 guidance RoIC: 35.0% 30.8% Warehouse Office fit-out IT Graph based on accounting fixed asset addition totals 12

FY16 Guidance • Group guidance unchanged • Total sales growth: c.20% • Retail gross margin: up to 50bps investment • EBIT margin: c.4% • Capital expenditure: c.£80m • China impact: • Presented separately as discontinued operation at year end • Guided £5-7m Investment during FY15/16, of which: • Operating losses to closure of c£4m • Remaining £1-3m redeployed into other strategic markets • Closure costs of up to £10m, majority non-cash • ASOS Continuing Operations: • Total sales growth: c.20% • Retail gross margin: up to 50bps investment • Benefit of c.£6-8m re change in US duty reinvested • EBIT margin: c.4.5% • Tax rate c.100bps above prevailing statutory rate 13

Nick Beighton CEO 14

Last 6 month video

Strategic Focus and Opportunity WHERE TO PLAY ASOS Population Online Clothing Growth Online Market share 15-34 Years 2015 2018 To Penetration of Online (M) £ Bn £ Bn 2018 2015 2015 16.7 6.9 9.4 36.2% 15.4% 6.9% 102.4 24.7 34.6 40.1% 11.6% 1.2% 39.7% 86.8 37.0 51.7 16.9% 0.3% ROW 1,358.9 54.3 113.0 108.1% 8.7% 0.4% Data Source: Conlumnio 2015 estimates, Total apparel and online apparel from all channels, including specialist retailers, department stores and grocers (clothing and footwear) 16

Our Mission TO BE THE WORLD’S NUMBER 1 DESTINATION GREAT FASHION, GREAT PRICE FOR FASHION-LOVING AWESOME ON MOBILE 20 SOMETHINGS ENGAGING CONTENT & EXPERIENCES BEST-IN-CLASS SERVICE

Great Fashion, Great Price • 80,000+ lines constantly changing • +900 boutiques on MarketPlace • c.3,500 new styles added every week • ‘First Price, Right Price’ • Now one unified Euro price* • Will invest further in the US • Continued tight inventory control • Further investment in to ASOS Brand • Successful launch of Bridal • 200 new brands added • ASOS Brand / 3 rd party mix • 44.4% / 55.6% * Exc. Spain

Awesome at Mobile AWESOME AT MOBILE • 3.2m app downloads • >60% traffic • c.50% orders • Complete refresh of iOS • Mobile check-out on track • Further mobile web improvements planned

Engaging Content & Experiences • Over 17 million Social media followers • Premier membership growth of 50% • ASOS A-List launched in UK in February • As Seen on Campus • Re-launched Access all ASOS • Insiders; now >1m followers

Best-in-class service: Warehousing • Warehousing a strategic priority • Barnsley improved productivity & efficiency • Nearly 3m units despatched over busiest week • Eurohub 1 now despatching 45% of EU orders • 3m units of stock • Belgium, Spain, Netherlands & Denmark added • Eurohub 2 continues to plan • Full ground works underway/ walls going up fast! • On track for commencement early 2017 21

Best-in-class service: Delivery Solutions & Customer Care • Strive for best-in-class customer proposition • UK enhancements include: • Midnight cut-off for every postcode • Greater convenience – more to follow • International enhancements include: • Free NDD for French, German & N.Irish Premier customers • Free returns across all EU by end April • US standard delivery from 6 to 4 days in trial • Ongoing investment in customer care 22

Technology • Tech team transformation • Team continues to grow • 230 tech releases in H1 • Micro service architecture being implemented • ASOS Software craftsmanship developed • Platform ownership framework in place • Significant progress made on: • Checkout / Secure programme • Retail Merchandising & Planning System • Launch of Gift cards 23

Summary • Momentum has increased, On track for FY • Tighter geographic focus • Relentless about : • Customer experience • Technology • Logistics execution • Unleashing internal talent

Appendices 25

HY16 Segmental Sales – Reported Growth Four months Two months Six months to 31 to 28 to 29 December February February £m 2015 Growth 2016 Growth 2016 Growth UK retail sales 206.2 25% 83.3 26% 289.5 25% US retail sales 49.7 42% 27.1 38% 76.8 41% EU retail sales 111.0 29% 56.9 14% 167.9 23% ROW retail sales 80.0 2% 34.4 (4%) 114.4 - International retail sales 240.7 20% 118.4 12% 359.1 18% Total retail sales 446.9 22% 201.7 18% 648.6 21% Total group revenues 459.7 23% 207.6 18% 667.3 21% 26