Will Asos join this grim enclosure? It is certainly heading that way, as the 2025 financial year now ending shows a further decline in revenue, down 15% on the previous year.
The British online fast-fashion specialist's operating loss, although narrowing, remains worrying; representing a tenth of revenue, it will be extremely hard to close.
The number of customers classified as 'active' has fallen by a further 14%, and visits to the online platform by 15%. The slump is even steeper outside the UK, where Asos appears to be abandoning the field altogether.
The only good news is a clever refinancing of the various debt maturities, notably thanks to the disposal of Topshop and Topman assets, which has enabled the group to reduce its net debt from £587m to £410m without a capital increase.
Asos has been unable to withstand the rise of fierce, innovative competition embodied by Shein, Vinted and the like. Germany's Zalando, which has developed on a pure platform model that is more open and flexible than that of Asos, has also largely supplanted it.
The British group's sales have halved since they peaked in the pandemic, while it racks up a third consecutive year of operating losses. Twice in the past five years it has had to make capital increases to deal with its debt problem which remains troubling.
Controlled by Mike Ashley and Danish billionaire Anders Holch Povlsen, Asos has never been able to return capital to its shareholders via dividends or share buybacks, even when it was at the height of its glory.
Like Moderna, as recently discussed in these pages, the group has failed to capitalise on the providential windfall of the pandemic. The result for its shareholders has been a phenomenal destruction of value.
