Asos Plans Equity Increase and Debt Extension

LONDON, United Kingdom — British online fashion retailer Asos said on Tuesday it was close to finalising a potential equity increase and extension to its debt facilities to ensure it can endure the coronavirus emergency.

The group, which sells fashion aimed at 20-somethings, has kept going during the national lockdown in line with government guidance that online retail can continue.

It said it had been monitoring the ongoing financial impact of Covid-19 on its business and had been evaluating a number of different scenarios.

The company has stress-tested its liquidity under these scenarios and was comfortable that, with mitigating actions, there was sufficient liquidity within its existing 350 million pounds ($431 million) facility.

"Whilst the company's financial position remains robust, the duration and impact of the Covid-19 related crisis remains uncertain and Asos wants to ensure it can weather and exit the current trading environment in a position of strength," it said, adding that a further announcement would be made shortly.

The retailer is due to publish first-half results on Wednesday.

Asos said it performed well in the period with sales growth in excess of 20 percent and progress in cutting non-strategic costs.

This combined with a stronger performance than anticipated in the January and February sale period, had resulted in a "strong first-half profit and earnings before interest and tax (EBIT) margin."

Shares in ASOS closed up 34 percent, paring 2020 losses to 54 percent.

By James Davey; Editors: Stephen Addison and Jane Merriman