ASOS losing its competitive edge

[WalbrockResearch821]

Today’s ASOS results and its historical results tell the following tales:

1). ASOS (despite marvellous sales growth) has seen their operating margin fall.


2). ASOS is experiencing free cash outflow because of higher than expected capital spending.

3). The medium-term outlook is to continue spending £230-£250m to expand, while the EBIT margin stays at 4%.

Asos financial is leaning towards more capex spending and borrowing more externally.

@Wh_biz32