Trading Update

Jul 15, 2020

Hi, there you go. You're live. Good morning, everyone. I hope you're all well and safe, and thank you for joining our call to discuss P3 trading this morning. I'm joined on the call by Matt and Alison, and together we'll talk through the performance and focus during the last 4 months alongside our outlook. We'll then be happy to take any questions at the end. As per usual, can you try and submit the questions through the chat box and we'll come to all the questions as we go through. So let me go to the next slide please. So let me start with a brief overview of the headlines from P3. Can I just request that people on listening over to you please, Thank you? All right. So let me start with a quick overview of the headlines in Q3. We'll go for more detail on the back of the company's operations and some of the moving parts. 1st point I want to make clear and well-being of the people in our wider supply chain. This was reflected in strict social distancing implemented and adhered to across all aspects of our business, all the way from operations in our warehouses to how we shoot our product on models and how we supported our suppliers. We then worked rigorously to manage performance within this context. Naturally, such an approach will come with some constraints, but we believe this is the right thing to do given the nature of what we've all been going through. Within that, I'm really pleased that we've what we've delivered as a business. I've been currently impressed by the agility, flexibility, creativity of our teams and the effort they have shown in navigating the business through this crisis. In terms of performance, when we last updated during April, we had seen sales back some 20% to 25% in most recent weeks. So I'm pleased to have that we have delivered a 10% growth for the period in retail sales. Item growth was up 15% reflecting the impact of a lower ASP from the product mix that we sold. And gross margin was 70 basis points lower than the previous year, which in light of the adverse product mix is testament to the way inventory has been managed throughout the period. Our underlying profitability and cash generation through the period was strong and reflective of the operational rigor with which we managed the business with unprecedented levels of uncertainty. This means that despite the incremental costs we've incurred through the COVID-nineteen period, we're on track to deliver strong profit growth and positive free cash flow for this year. We've been very mindful of the impact of the crisis on all our people and the wider society as a whole. As a result, we will be repaying the furlough support we accessed in April. And obviously, we will not be accessing the further furlough bonus that's being made available by the government. I'm now going to hand over to Matt, who's going to talk through a little bit more detail on the moving parts, the regional performance and how we adapted our trading stance to manage through the constraints we encountered. Thank you. I'll speak to you later at the end. Thanks, Nick, and good morning, everybody. I'm going to start with products and demand. And as Nick mentioned, when we last updated in April, we showed you 2 charts that reflected the dramatic change in the product customers were shopping into active wear, casual wear and face and body and out of more occasioned categories such as dresses and formal wear. This shape of demand continued across the period reflected over springsummer without holidays, music festivals, weddings or the option to go out to bars, restaurants and clubs. Growth in lockdown categories has been extremely strong over the period as you can see on the left hand chart. However, this demand has come at the expense of growth in the categories where ASOS and particularly ASOS Design is most established and best known by customers' product for going out. The chart on the right hand side illustrates the relative product mix in our business this time last year. And you can see occasionally categories far outweigh the lockdown categories as a share of our product mix. Activewear and face and body are reasonably new categories for us and once we were still focused on growing our offering in. However, we were really pleased with how Collusion and ASOS 405 in particular performed through the crisis. When you take these two charts together, you can see why the impact from occasion led categories was more pronounced to ASOS overall than the strong performance in those lockdown categories that were thriving. Our teams have shown great agility in adjusting our product mix, but the scale of the shift in demand at a time where brands and factories were themselves facing severe disruption and lockdowns was a significant challenge to manage. We also wanted to make sure that we did not create further issues for our suppliers, and the net result was that demand for certain products did outstrip supply and certainly speed of supply. Looking forward, we are working closely with our supplier base to ensure we are positioned with the right products and flexibility to maximize opportunity across the peak period and the season ahead. We will continue to develop those categories, which remain a long term and differentiated asset for ASOS, alongside rebalancing our customer offer to reflect the recent shift in demand. Before we move on from product, the other element that is worth noting at this point is the further basket economic impacts of this change in product mix. The first is the impact on average selling price, which was back 9% in the period, which in most territories flow through to ABB. Beyond this, those categories that outperformed also attracted an overall lowest gross margin. However, this has been to some extent offset by positive changes in returns behavior. Face and Body and activewear generally show lower returns rates due to the nature of the product. And whilst we are clear that there could still be a backlog of returns with customers, we have seen a move to more deliberate purchasing, which is why we called out our net item growth for you this morning as we believe that is more indicative of where underlying customer demand is. Turning now to warehouse capacity. As Nick said earlier, our priority was to protect the health and well-being of our people and that naturally caused constraints. One of the main challenges was the significant throughput capacity restrictions in our U. K. And European warehouses. These restrictions came about as we work to overhaul our process and operations to ensure effective social distancing in our facilities, something we did in collaboration with local environmental health agencies, our recognized union in Barnsey, the Community Workers Union and the Barnsey Council. Our warehouses are automated and mechanized, which results in people being congregated in certain high density areas, such as pack benches, for example. So we had to go beyond just increasing the distance between people and this took some time to implement. This was exacerbated further in the Eurohub by the border closure between Germany and Poland, which restricted a number of our workers being able to attend work. On the chart on the left hand side of on the screen, you can see what available labor was in comparison to our planned level. It was driving a reduction in ASP and hit an even greater requirement for unit throughput. As a result, we took a number of customer facing decisions to avoid stimulating demand we couldn't effectively service, to ensure we didn't disappoint customers on our delivery promise and also ensure no one was tempted to take undue risks across our supply chain. As a result, next day delivery was turned off for 7 weeks out of our UK warehouse and 5 weeks out of Eurohub. We also added up to 11 days to our standard delivery proposition, something we were upfront with our customers about before the point of order. Our capabilities here are the cornerstone of our customer proposition, and we are clear that open and transparent communication is key to building trust with this generation and our customer base. We kept them updated on the changes we were making and how we were prioritizing health and safety. Further to these proposition changes, we softened our promotional calendar and reduced our marketing spend, which I will touch more on later. We have made great progress in restoring capacity and this has allowed us to restore our delivery proposition across all key markets. We are continuing to improve capacity throughput further to ensure that our facilities can support peak trade whilst adhering to social distancing. As a part of this, we will be investing a further €5,000,000 of incremental CapEx to ensure workers are safe on a as we scale our capacity for Peak. Turning now to customer engagement. We saw good engagement throughout the period across our social media channels and in traffic to our sites. This reflects the strength of our relationship with our customers and our role in their lives beyond that of a transactional platform. In April, we showed you the impact on sales growth in Italy as it went into lockdown with a pronounced reduction in both conversion and physics. We said we were seeing early signs of the fast recovery in traffic and that trend continued through the period as shown by the chart on the left hand side. We also said at that time, we would expect conversion to remain more subdued, reflective of the lack of occasions, holidays, festivals, going out and weddings to shop for. The chart in the middle demonstrates that while showing an improvement in year on year conversion, it is still back on the year, something we'd likely expect to continue whilst events continue to be restricted. Turning to social media, we saw strong engagement through our social media channels. We had our strongest ever month for social media engagements in May with over 9,000,000 likes, comments and shares, up over 90% versus the previous months, with customers reacting very positively to our content and the way it has pivoted to reflect the realities of lockdown living. As I mentioned earlier, we took a number of customer facing decisions to manage the constraints. And considering this and our softened approach to marketing and promo in particular, we are pleased with the 700,000 new customers added to our active customer base in the period. In terms of a bit more color within that number, new customer acquisition was particularly strong in international territories and those with lower levels of online penetration. Italy and France were particular standouts for us. Lockdown product was a particular appeal for these new customers and that drove strong growth through those categories. Reactivated customer growth was also good globally, but growth in spend from our existing customers was a little more subdued than usual through the period. We think that this is to be expected, detail on how these factors played out in our regional performance. I will now turn to a little more detail on how these factors played out in our regional performance. Starting with the UK, there are a number of factors at play, so I'll cover the most material ones. Reflective of the nature and scale of the UK outbreak and the UK's approach to coming out of lockdown, we have seen a continued skew towards lockdown category mix. Given the usual strength of NDD mix in the UK, the UK also felt the greatest impact from our change in delivery proposition. As we were balancing the impact of our trading startups and proposition globally, we took decisions that did prioritize our international territories over the UK. For example, protecting promo activity over Ramadan in the Middle East and switching some European territories to fulfill out of Barnsley. Both of these things further reduced our capacity for the UK, but were important trading decisions to take. Further to that, as our most established home market, there was less opportunity for new customer acquisition in the UK. We have, however, seen improvement more recently as the UK has started to lift lockdown measures. Sales performance in the EU was strong. Initially, we saw demand held up a little better than in some other reasons, and we saw faster and stronger rebound in underlying demand, reflective of the easing of lockdown. Good growth in both new and reactivating customers with Turning now to the U. S. We felt a strong initial impact to sales growth here and a bumpier recovery in demand reflective of the divergent approach to lockdown restrictions in the U. S. Environment. From a Renaissance perspective, our product mix in the U. S. Gives further towards dresses and formal wear, and we don't yet have an established face and body offering in the region. The reduction in available air freight did cause some disruption to our customer facing stock offer in the U. S. As a growing stock pool still receives a good proportion of airfreight from the UK. This is now recovering as product lands, but it did impact product choice and availability in the earlier part of the period. Finally, we saw a good recovery in rest of world and have seen the quickest move back towards a more normalized product mix here. The region responded well to the targeted promo calendar we ran, particularly through Ramadan in the Middle East. We took action in the region to protect basket economics in the face of significant increases in airfreight costs, which drove notable increases in both items for basket and ABV. I'll now hand back to Nick to wrap up. Thank you, Matt. Hopefully that was helpful to provide you more detail on the Q3 dynamics. In terms of outlook from here, we continue to focus on trading through springsummer in an agile and dynamic way. We are preparing for autumnwinter, setting ourselves up to maximize the opportunity ahead. We are working very closely with our supply base to ensure we build the right product offer in the face of a less certain demand profile, protecting those occasional categories that we know customers love ASOS for, but making sure we have greater flexibility to deliver the product that reflects the demand and the constraints of within the constraints of our supply chain. Progress continues in warehousing to ensure we've got the right capacity to execute over peak, a target we're confident in the region in spite of maintaining the appropriate level of social distancing. In terms of overall demand, while social restrictions remain in place, we're cautious on demand for occasion wear until a more normal pattern of social events resume, the timing of which is very hard for us to predict, particularly in the context of a potential risk of the second outbreak. We're also mindful of the medium term economic consequences for our 20 something customers. We expect continued limited demand for occasion there for the rest of this financial year. Despite this uncertainty, we confirm that our strong operational with strong operational grit will deliver a much improved financial performance over the year. We expect to deliver substantial year on year profit growth despite the significant incremental costs and disruption we've incurred associated with COVID-nineteen. And this year, we will return to positive free cash flow. Alongside this, we remain on track to emerge as a stronger, more resilient business. As we look further ahead, we believe we have seen around 10 years of digital disruption in the last 4 months, and we are well positioned in this context. We are now much better capitalized with an increasing and more diverse and resilient and differentiated product offer and the global infrastructure to leverage going forward. This gives us even more and continued confidence that ASOS will continue in progressing as one of the few truly global retailers in e commerce. Thank you very much for listening. We'll now hand over to questions. Please do submit your question along with your name and institution and Answering will pick them up and direct them to Matt Nye. Thank you very much. Okay. So our first question comes from Eleonore Adani at Stifel. Was wondering what we should expect as a write off amount related to the boohoo and PLT stock? You will see in the commentary that we gave in the pack that we are not expecting any significant COVID related stock write off. And we probably will exit this year with a much cleaner terminal stock than we've done in previous years. This is also including a potential write off from the boohoo stock. We're not, of course, quantify all of those numbers for you, but just that we've got that, we are mindful and we've taken the impact of that during our year end projections. Next question is coming from Rocco Arate. From a cash flow P and L perspective, can you talk about the furlough impact and how this impacts 2020 PBT and when it will be paid back in FY 2021? Do you want me to do that, Neil? Yes, sure. So from a PBT perspective, we the benefit will not be in our 2020 PBT. As we just work that through with HMRC, but it shouldn't it won't affect 2020 PBT. Next question is coming from Jose at Caixa, asking if you can talk a bit sales performance in June in order to assess the evolution throughout the period. Do you want me to do that one, Nick? Yes, please. So I think I mean, in terms of how to think about kind of momentum through the period and potentially the exit rate, which I know is topic everyone is very interested in. It is fair to assume that the exit rate is stronger than the average for the period. But as we flagged in the statement and hopefully is clear from the call, we are still seeing quite significant impact on occasion led product. And therefore, we're not necessarily trading at the level we would have been COVID. So it gives you a feel for kind of where that dynamic might sit. Next question comes from Jon Stevenson at Peel Hunt. Can you give some more clarity on the removal of non strategic costs and marketing spend versus one off COVID costs and the contribution this is making to profit growth? I think that's Matt again. Yes. It's Matt again. So I mean, in terms of non strategic costs, everybody hopefully was saw the momentum that we delivered in H1. And obviously, we recorded a record PBT supported by that momentum on strategic costs. And that has definitely continued into H2, both the benefits that we derived in H1, but also we've continued to make progress on that. In terms of the other moving parts in H2 profitability, we have seen a benefit from the dampening of our marketing spend and our promotional mix through the period, as is probably clear. And we've also seen the benefit of an advantageous returns profile through the period. So those things have been positive for PBT. However, we've also seen material incremental costs associated with COVID, and they've been in 2 particular areas. 1 is, as we've taken the social distancing measures we just described, that has had an impact on the costs in our warehouse, and that's to do with the staggering of shifts. That's to do with the incremental cleaning we're doing. And so there's quite a lot of incremental costs going in there. And as I flagged on the call, there will be some further incremental costs to go in and we're seeing those costs continue for some time. And then also, we've seen a significant incremental cost on air freight. Therefore, particularly in rest of the world, we've seen that incremental cost flow through to our P and L. As I also mentioned, we've sought to mitigate those impacts through other actions we can take, but they have had a material impact on that P and L. So those are the moving parts in terms of profitability. If you take those in aggregate, I think it's fair to say that the non strategic customer momentum that we've got has underpinned the margin performance that we're guiding towards today. Next question comes from Michelle Wilson at Berenberg. Have you seen any impact on sales or traffic since dropping boohoo products? Have you or are you changing the way you communicate with customers in light of the boohoo supply chain allegations? Thank you, Michelle. No, we've not seen any material change in sales or traffic over the last 7 days that are discernible in relation to the boohoo impact. Your question is gone. What was the second part of that again? Are we changing the way we communicate with customers in light of the allegations? Sure. The 5 years ago, ASOS reenacted the Fashion Integrity Program, which has 4 pillars. It's about people, it's about products, it's about packaging, and it's around a route to net 0 carbon. We've been making great progress and invested a lot in all of that over the last 5 years. One of the things that we weave into our communications and we're going to do more of that, we're planning to do some of that anyway, It's just telling those stories about how we protect people's supply chain, how we build out products with an end use in lye, how we have significant sustainable sourced cotton within our product, how all our garments are capable of being recycled and how our packaging is recycled and all the progress we make and all of that. So we're going to continue to dial that into our communication and we're doing that anyway. But in the light of the boozer allegations, it's ever more important that we tell those stories to our customers about no commitment on their behalf. Next question comes from Rebecca McKellan at Santander. How are you expecting the promotional environment to evolve from here? And what are you expecting in terms of discounting activity through people and into next financial year? Okay. That'll help, Matt. Yes, sure. So as was hopefully evident from the charts, we're now trading unencumbered. And in that sense, we've restored a more normal promotional calendar. Think it's also best to say that the promotional environment is busy. There's a lot of activity out there. And therefore, we are expecting a relatively high level of promotional intensity in P4, but not necessarily unusually out of the ordinary. I think Rebecca, being able to be more specific about what might happen into autumn winter, I think, is much less clear. I think, clearly, the spring summer dynamics in part are dictated by people's stock positions going into spring summer. And obviously, the autumn winter cycle will be dictated much more by people's positions going into that. I guess what I can say at this stage is we are anticipating that there will be a normal peak period. People will still it will still be a key for customer acquisition, and we're still expecting that peak associated with Black Friday trading to the Christmas period. And we're preparing for that in a way that we would normally prepare for that. The extent of that, the product mix, other things, I think, they're uncertain, and we're preparing for peak with us building in as much flexibility into our operations as we possibly can do because I think the hardest thing to predict is where product mix is going to be, especially in light of the flag in terms of any potential second waves in territories, etcetera. So probably flexibility is key. We've got Dave Holmes at Bank of America has asked a similar question, but a brief follow-up. Have we noticed any change to that since physical stores have reopened in terms of the promotion environment? Not a material difference, no. It was people were already promoting quite actively in the last half period. So we haven't seen a particular material shift post stores opening. That doesn't mean that will change. I guess, as we get towards the back end of the season, you may find that that store dynamic becomes more significant, but currently, we haven't generated a material shift. Got another question from Michelle Wilson at Berenberg. Given free cash flow positive in FY 2020, it looks like you could have significant net cash at the year end. What are the priorities in deployment of that cash? Do you want to answer that? Yes, Anthony. So I think the priorities are similar to those that we want at our half year results and associated with the fund raising. It, it's the net cash balance will give us the flexibility to make sure that we can prepare for future growth. And within that, it will give us the ability to prepare and trade sharply through peak. And then ultimately, for us to be able to further update of the full year results in terms of how we see next year and kind of what our balance of investments and so on will look like for the next year and beyond then. Question now from Jeff Ruddle at Morgan Stanley. So Kantar data suggests that the UK online bidding market grew significantly in the accept that ASOS has been losing online share during Peter in the UK? Why do you think that is? So I don't that's not a number that makes sense to us. The data we are seeing would suggest that the UK online fashion market has been significantly impacted by COVID. It's very hard to get reliable data, which captures the full remit, particularly what people are seeing on app, for example. But our assessment will be quite different from the way you position the question. I believe based on the sources we're seeing is that we've probably actually gained share through the period. But it's not something we're able to be categoric about because there isn't a reliable data source that gives you a full picture of what's happening in online fashion. Next question is from Anisha at Bernstein. Are you continuing to see higher demand from partner brands looking to sell excess inventory? Or is this tapered as we go into autumnwinter? Do you expect to have materially higher number of partner brands by the end of this year? So one of the issues we have found on the 3rd party brands is actually less products available on the supply chain. Our outlet business has been very busy booking some excess on full price, but some of that have been substantial restrictions. And that makes a lot of sense. If you think about when COVID-nineteen was first talked about back in February, it was a supply issue in China as many of the manufacturing units closed. As it swept across Europe and the rest of the world, other factories, our own factories including the factory of 3rd party brands also puts down, which greatly restriction and supply. We're working hard with the outlet team to try and pick up whatever we can and do more deals than ever before. And I've been very, very pleased with the agility those guys have shown. In terms of full price stock, there's actually been a restriction in the availability of supply, particularly in the categories that we've been chasing, such as casual wear, such as sneakers, active wear. So it's been a bit of a concern over the recent weeks. Next question comes from Rachel Burke at Zoos Capital. Could you clarify how much, if any of your product is sourced from the UK and Leicester specifically? Yes. We have about 7 factories in Leicester, 10 in the UK in total, 10 suppliers UK, 7 in Leicester. The sourcing mix is about 1.5% of our total sourcing. We've got three questions here from Simon Bowler at Numis. So the first question, you acquired a lot of customers over peak last year. What is your sense of retention of those customers? Yes. So I mean, it is somewhat skewed by the COVID period. And as I flagged in the comment in the opening remarks, we've definitely seen an impact on customers not spending as much on the going out area. However, notwithstanding that, it does feel like the profile of the customers we acquired in peak last year would have a similar level of retention dynamics to our broader customer base. And therefore, the early signs are quite promising that those activities will yield a long term value to us in a way that we would have hoped they would. So is that the 2 are also around the problem of those customers, which I think you've covered off the second one in terms of how they're behaving with regards to the normal ones we've acquired? Number 3, it shows how things normalize, would you plan to drive customer acquisition harder than usual given the theoretical acceleration in channel shift where we're seeing through this crisis? I think the answer is ultimately yes to that in the sense that the peak period is when customers are most likely to experiment with new brands and new sites they've never tried before. And therefore, we do see the peak period as a key acquisition period as we do every year. I guess the channel shift hopefully means more people are open to that experience than was the case last year. But my only caveat, I guess, is the macroeconomic environment and the amount of uncertainty makes it hard to be categoric about that. But that's certainly how we're setting ourselves up for that situation. Next question from Lev Townsend at UBS. Can you give some more detail on the gross margin bridge? For example, the impact from geographical mix, business design mix, foreign exchange impact as well as promo and product category mix? I'll start with you, Mac. Mac. I can, although obviously, we'll give a further update at year end. So but let me kind of give a sense of it. So the key drivers in gross margin are product category mix. That's the biggest impact. As typically occasion where it tends to be high priced and high margin largely, I guess the converse of that is that a lot of activewear face and body has a low returns rate as I previously flagged. So whilst it might have a margin impact, it doesn't necessarily have an overall detrimental profit impact. We've also seen some benefits from a less intense promotional calendar, which will have partly offset that. I think as you move forward into P4 and thinking about that, we've definitely we will see a kind of FX impact in P4 as we which will which is probably the only other thing to be aware of in terms of that kind of gross margin dynamic. Next question is from John Stevenson at Peel Hunt again. How are you planning to peak in terms of mix, stock commitment and Black Friday? I'll take Let me try that. In my outlook comments, while there's social restrictions, which basically means our customers will not be able to do the things in the same way they were once before. Therefore, demand for occasion wear is going to be needed. So we are planning to see, but we're dialing up all the other categories, sportswear, casualwear, activewear, face and body that are showing excellent growth as Matt Sharp showed earlier. That's how we are approaching it to the end of this financial year and therefore Black Friday. What we're also doing is working on some nearshore sourcing ensure we have greater flexibility, particularly in Turkey, so we can react on some of those Jersey categories far quicker than we would have been normal. Okay. 2 more to go. So we have one more from Simon Bowler at Numis. Have the customer acquisition trends broadly mirrored the revenue trends in terms of the regional split? So the it is worth translating into 2 component parts. Customer acquisition trends have been stronger than revenue trends overall. Where we've seen more muted trading is in our existing customer base, who would typically look to us to buy with the stuff that they're going to buy for going on holiday or going to Glastonbury or going out, that's where we've seen the impact. So we've sort of seen that in the kind of net number, but we've seen that mix between new customers and shopping from existing. And then final question comes from what I've got on screen. Again, Michel at Berenberg. Clearly, there was huge uncertainty at the beginning of P3, and you had to take time time good question, Michelle. Going back at that moment in time, the thought process we went through were 1, 1st of all, protect supply. Secondly, it was then how to digitalize and work from home. Then it was scaling down, protecting costs. And then it was very quickly ensuring the organization had the right amount of liquidity for what was a very uncertain time ahead of us. Looking back, we acted with an abundance of caution, which is what we thought was the right thing to do. We acted to protect the health and well-being of our people and the wider supply chain. If we do one thing, I think we'd have probably placed more casual wear, more sportswear, more face and body. But that would be the one thing that I wish we'd have done. We acted appropriately on occasion wear. We called that one right. But actually, the lockdown categories, we have the ability to sell far more. And if we'd have gone back and changed our order profile, it would have been on those build I have on that is even if we place the orders though, I'm not sure that we would have necessarily got them because of the restrictions that very many of our suppliers had. So it's not certain that even if we've had the foresight to know exactly where this category is going to land that we could have sourced it because particularly some of our agglobal partner brands were at maximum throughput in their own warehouses, and therefore, we just physically couldn't have taken any more products even if we'd wanted to. Okay. I've just had 2 more pop in. We'll take those and then we'll wrap up there. So this one comes from Anisha at Bernstein. Again, given the stronger sales growth and positive free cash flow outlook, will you still be supplying TGR CapEx as planned earlier this year? So yes, but not for cash we delayed the launch of TGR because we felt trying to launch TGR in a period where everybody was working from home would have a risk profile that we would be uncomfortable with. And therefore, we took the decision to delay TGR into next year and the launch of it. So in that sense, we still think that's the right decision because we want to make sure that when we do implement TGR, we do that with an appropriate risk profile. So but it's not driven by cash flow considerations, it's driven by operational considerations and trying to make sure we land it in the right manner. And then final one, which I think you've touched on to some extent, but from Rebecca McKellan at Santander. What changes have been implemented, if any, in order to increase procurement flexibility given the uncertainties regarding demand mix? I talked about the agility of some near term in our core product procurement. But as well as that, Rebecca, during COVID-nineteen, we've also learned a lot. One of the key pivots we made in studios is doing models from home and building extra studios in our Leasing office. That's going to be the future flexibility, future cost savings and future resilience. So and then a lot of our processes, we replugn them in a more digital way. Those are more efficient and those are going to be a lower cost solution for us. So as well as the procurement change we just talked about, there's an awful lot of good things we've learned in the way we do business that we're already implementing and staying with during the going through. Through. I think, again, if I can build on what Nick said, we said in April, and I think our results are a testament to this, that we can re gear our business on a 6 to 8 week cycle. We'd love that that cycle was shorter than 6 to 8 weeks, but I think we have re geared our business on a 6 to 8 week cycle and we're planning even more flexibility as we head into the peak period. But I think we've demonstrated that actually we do have good flexibility and agility in a number of areas, as Nick has pointed out. And we're planning in that way, and we're planning to have even more as we go into the future. Great. That's all the other questions I've got. Thank you. Okay. Thank you, everyone, for joining. Just to summarize, as I said at the end of my outlook session, as we look further ahead, there's been substantial digital disruption in the retail market over the last 4 months. We are very well placed to capitalize on that. We are well financially capitalized. We are increasingly more diverse and resilient in our product offering. And some of our categories that we are that we were building have had an awfully have a great performance. This gives us continued belief in the confidence that ASOS will continue to progress to be one of the few truly global leaders in retail. Thank you very much for listening. Please stay well and safe everyone. We look forward to speaking to you all soon. Thank you.