ASOS confident on growth amid tariff uncertainty
ASOS posted higher half-year earnings today, showing that a plan to rebuild the retailer's fast fashion credentials with its 20-something customer base was starting to work, though it now faces new upheavals from tariffs and trade turmoil.
Britain is ASOS's biggest market, but the United States accounts for about 10% of total sales.
Asked about the impact of tariffs, CEO José Antonio Ramos Calamonte said there were a lot of moving parts with changes almost daily, and details remained unclear.
"The answer always has to be flexibility and adaptability," he told reporters, adding that ASOS was better placed than its competitors as less than 5% of its own-brand sales in the US come from products made in China, which faces the highest US tariffs.
Ramos Calamonte said ASOS's source markets are spread across Morocco, Turkey, Eastern Europe and Britain, adding that in total about 25% of its own-brand garments come from China.
In recent years, ASOS has faced intensifying competition from Chinese-founded giant Shein and China's Temu in both its home market and the United States.
However, President Donald Trump's high tariffs on Chinese goods imported into the United States and shifts in customs policy on direct shipments to consumers in Britain and the US could now give ASOS an advantage.
Britain said on Wednesday it would review the customs treatment of low-value imports exempting goods worth 135 pounds ($180) or less from duties, a system that has benefited Chinese retailers.
The US administration has gone further, banning from May the waiver of customs duties on imported items worth less than $800 that are shipped to individuals from China and Hong Kong.
Though ASOS ships products for US sales from Britain in individual packages after the company mothballed its US warehouse earlier this year, it will still face lower import levies than its Chinese competitors.
Shares in ASOS were flat in mid-morning deals.
For the 26 weeks to March 2, ASOS posted half-year adjusted earnings (EBITDA) of 42.5 million pounds, beating forecasts. It said it was on track for annual earnings to come in at between 130 million pounds to 150 million pounds.
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