Online Retailer Struggles with Warehouse Transformation

  • Asos issues third profit warning in 2021
  • Operational issues cited as main factor for decline in profits
  • Annual profits expected to be between £30m-£35m
  • Sales up 11% and group revenue up 12%
  • CEO Nick Beighton addresses operational challenges in US and EU warehouses

Online retailer Asos has issued its third profit warning this year, citing operational issues as the main factor for the decline in profits. The company’s CEO, Nick Beighton, attributed lower sales, higher warehouse transition costs, and organizational restructuring expenses to the warning. Annual profits are expected to be between £30m-£35m. Despite a 12% increase in group revenue to £919m and a 100% rise in company sales to £894m, Asos is facing challenges with its warehouse programs in Europe and the US. Beighton mentioned that embedding changes from the infrastructure overhaul has taken longer than anticipated, affecting stock availability, sales, and costs in these regions. The retailer also reported reaching 20 million active global customers for the first time.

Factuality Level: 8
Factuality Justification: The article provides accurate and objective information about Asos’ profit warning, citing specific reasons such as operational issues, lower sales, higher warehouse transition costs, and organizational restructuring. It also includes quotes from the CEO to support the claims made. However, it lacks a comparison with previous years’ profits or any context on how these numbers relate to industry standards.
Noise Level: 3
Noise Justification: The article provides relevant information about Asos’ profit warning and operational issues but lacks in-depth analysis or exploration of long-term trends or possibilities. It also does not offer actionable insights or solutions.
Financial Relevance: Yes
Financial Markets Impacted: Asos stock price and related retail stocks
Financial Rating Justification: The article discusses Asos’ profit warnings, impacting the company’s financial performance and potential changes to its head office staff. This directly relates to financial topics and can affect the company’s stock price as well as other retail stocks in the market.
Presence Of Extreme Event: No
Nature Of Extreme Event: No
Impact Rating Of The Extreme Event: No
Extreme Rating Justification: There is no extreme event mentioned in the text.

Reported publicly: www.retailsector.co.uk