Questions and Answers

Last year revenue was up 104% but in the first 13 weeks of the current year your sales were only up 52%. Have you gone ex-growth?

Not at all! You have to realise that to deliver last year’s results, we had to buy 100% more stock than in the previous year. In planning for the current year, we were more conservative and this was reflected in the analysts’ forecasts at the start of the year when they were looking for sales growth of 35% to 40% for the year ending 31 March 2010. It is still early in the financial year but, if we achieve this level of growth, we think it will be an outstanding achievement and we hope it will please our shareholders.

You appear to be adopting a high risk strategy by expanding overseas. Given the current economic environment is this wise?

This past year our international sales amounted to £32.2m or just under 19.5% of total revenues. This was achieved with very little marketing effort on our part but, as you can see from last year’s numbers, international expansion is a major opportunity which we plan to take advantage of through a low risk approach. As you are probably aware, Nick Beighton recently joined us as Finance Director and following his arrival Jon Kamaluddin, his predecessor, who joined us in 2004, will be spearheading our overseas expansion.

We are not planning a major international launch. What you will see is a roll out of the ASOS brand with additional emphasis on particular countries. As of today, our customers have a choice of six currencies to choose from when they shop with us and we export to 58 countries worldwide. This will increase to over 100 during the course of the current year.

At the forefront of our thinking is customer service. With distribution services available today, we can now deliver to many places in Europe and North America within two days, which is probably as quick, if not quicker, than retailers in those countries. This enables us to fulfil international orders from our distribution centre in Hemel Hempstead without the major cost of having to build centres in overseas territories.

As shareholders are aware, we have very sophisticated technology and during the past year we invested over £15.5m in our warehouse operation to meet growing demand. We are continuing to benefit from the efficiencies that this ongoing investment in logistics is producing and this has given us confidence that we have the resources in place to expand overseas.

In due course, probably within the next 18 months, we will start to introduce country specific websites but this aspect of our plans is still at the development stage

With over £13.5m on your Balance Sheet and no borrowings, why are you failing to pay a dividend?

The Board looks at this issue very carefully but, given what we believe to be the very exciting growth opportunities that still exist, we feel that it is in the interest of our shareholders that we continue to invest in the business.

Nick Robertson

Chief Executive Officer