Asos Plc shares soared after the struggling fast-fashion retailer said it was making headway in its plans to turn around its performance.
(Bloomberg) — Asos Plc shares soared after the struggling fast-fashion retailer said it was making headway in its plans to turn around its performance.
Chief Executive Officer Jose Antonio Ramos Calamonte has led an extensive overhaul since taking over in June, reducing stock, slowing automation and cutting spending. He said Wednesday the retailer had made “good early progress against a number of measures to simplify the business.”
Asos has identified more than £300 million ($364 million) of “profitability measures” that will show benefits mostly in the second half of the fiscal year.
“Management has placed a significant focus on protecting profitability in the current environment in order to offset inflationary and returns-rate pressures,” Berenberg analysts said in a note.
The stock rose as much as 18% in London trading, reversing early losses. The shares have gained 35% since the start of this year, after losing three-quarters of their value in 2022.
The retailer reiterated that free cash flow this fiscal year would be zero at best with the business generating cash again in the second half.
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