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£110m boost for Asos infrastructure

Asos is stepping up investment in the business, with £110m of funds earmarked to be ploughed back into the etailer over the next two years.

Capital expenditure will increase to £55m for the current financial year and again in 2014/15, up from £33m for the 12 months to August 31, with a particular focus on distribution and IT infrastructure.

Asos will spend up to £30m expanding its Barnsley distribution hub and will create a “Barnsley equivalent for northern Europe” in the next year, which will service Germany, France and Scandinavia, among others.

Asos chief executive Nick Robertson said: “There is a step change in investment now.”

Asos revealed this week that pre-tax profits rose 37% to £54.7m in the year to August 31. Group revenues climbed 39% to £769.4m. Retail sales grew 40% to £753.8m, with the UK arm up 34% and international revenues up 44%. International sales accounted for 63% of total retail revenues, up from 62% the year before.

Asos launched in Russia this May and has “seen subsequent strong growth in this territory”. Its Chinese debut is “now in final testing phase and will be launched imminently”.

Throughout the year menswear and womenswear both performed “strongly”. Asos continued to diversify its womenswear offer with an increased breadth of petite, maternity and plus-size product in response to consumer demand.

“There is momentum, we are definitely seeing strong UK growth,” said Robertson. “This isn’t about macroeconomics, it’s about a fundamental shift in how 20-something-year-olds shop, and the vast majority is online.”

It has been reported that Robertson has awarded staff with a £2.8m bonus that he is personally covering. He informed the staff of the gesture in an email last night.

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