UBS has forecast a sales increase of 23% for the quarter to June 30 with warmer weather boosting demand for ASOS’s summer clothing ranges.
The Swiss bank sees no change to the full year sales guidance of 25-30% growth and an underlying earnings (EBIT) margin of 4%.
Looking ahead, UBS thinks there is likely to be more focus on developments in the US after the Supreme Court overturned a ruling that allowed pure-play online retailers to avoid sales tax in the country.
ASOS will need to levy sales tax in more states after the June 22 ruling, which knocked its share price at the time.
“However, given differing state-level threshold order values, the impact may be limited,” UBS said.
“Perhaps more interesting is the requirement to pay 18-20% import duty as more orders are fulfilled from the new US DC. This cost should be covered by lower fulfilment costs, but more clarification would be useful.”
Dunelm turnaround may not be easy in the current environment
If profit warnings really do come in threes then shareholders will be a bit nervous.
The curtains and cushions flogger warned at the end of May that it had recently experienced trading conditions that have been materially more challenging than had been expected, within a soft homewares market.
Like-for-like (LFL) sales in the fiscal fourth quarter were running 4.7% below the same quarter of 2017 in the bricks & mortar estate, although thanks to a 43.7% year-on-year increase in online sales, LFL sales overall were 0.1% higher than a year earlier.
The retailer said it expects total sales for the full-year to be in the region of £1.05bn, up from £955.6mln the year before.
JP Morgan Cazenove was sceptical about the retailer’s ability to turn things around given the uncertain consumer environment, with spending on big-ticket items particularly weak.
Dunelm shareholders can take heart, however, that shortly after the profit warning in May, the chairman, Andy Harrison, bought 92,452 shares at 547.53p a pop, which is a show of faith costing more than half a million quid.
Significant announcements expected
Finals: ReNeuron PLC (LON:RENE)
Economic data: US CPI; US weekly jobless claims