Fashion retailer Asos (LON:ASC) saw shares fall 9 percent in early trading on Wednesday, despite a strong half year performance taking profits up 10 percent.
The online group reported a 27 percent rise in retail sales for the six months to February, hitting £1.13 billion, with profits reaching £29.9 million.
However, the group spooked investors on Wednesday morning bu saying it would reinvest up to £250 million of the profits in its operations.
Nicholas Hyett of Hargreaves Lansdown told the BBC:
“Any retailer growing at 20% plus a year will need to invest, but what’s disappointing about Asos is its tendency to underestimate capital expenditure requirements by some tens of millions a year”.
Asos has already spent around £95 million this year on its business.
CEO Nick Beighton applauded the strong results, saying that the site attracted more than a billion visits for the first time.
“These results show strong trading at the same time as we are making substantial investment in our future”, he added.
Shares in Asos are currently down 7.80 percent at 6,482.00 (0934GMT).
