Online retailer ASOS recruits company doctor to fashion turnaround

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ASOS has drafted in a leading company doctor amid pressure from its lenders about the state of its balance sheet

The online retailer, which bought Topshop out of administration in 2021, had sales boom during the initial phase of the pandemic, but has struggled since, grappling with a string of management changes.Early in the pandemic, it raised close to £250m from a share sale to enable it to take advantage of opportunities arising from the dislocation caused by COVID-19.Topshop was the most prominent of those, although it has also explored other acquisitions during the period.

However, inflationary pressures and the fading of investors' assumptions that soaring demand during the pandemic would be sustainable have coalesced into a string of profit warnings. It said recently it had cash and undrawn credit facilities of about £430m, and would return to a position of cash generation in the second half of the year.Last autumn, Sky News revealed that its biggest lenders, which include Barclays, HSBC and Lloyds Banking Group, were lining up AlixPartners and law firm Clifford Chance toOn Thursday, shares in ASOS were trading at around 794p, giving it a market value of nearly £780m.

 

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