LONDON, United Kingdom — Asos shares fell the most since December after second-quarter sales growth fell short of the full-year target the online fashion retailer lowered that month.
Retail sales grew 11 percent at constant currencies for the three months ended February 28, leaving it playing catch-up to reach its full-year guidance of 15 percent.
This is the first update since the British online retailer cut its sales-growth guidance from a range of 20 percent to 25 percent after a “significant deterioration” in November sales, which drove its shares down 43 percent.
The company will cut prices and raise marketing spending in the second half, particularly in its two largest markets, France and Germany. It’s looking to improve its US business after unexpectedly high demand there caused “a significant short-term dispatch backlog which we have now cleared.”
Asos and other online retailers, such as Amazon and Boohoo Group, are facing calls for a UK tax hike after a government report last month concluded that current rates are unfair and stack the odds against bricks-and-mortar retailers.
Asos fell as much as 13 percent, the most since December 17, to 415 pence in London trading. It had gained 39 percent from the start of the year through Monday.
By Ellen Milligan; editors: Eric Pfanner, John J. Edwards III.