Online fashion retailer ASOS has seen pre-tax profits plunge by 87% after a “disappointing” first half.
The figure, for the six months to the end of February, came despite a 14% growth in sales.
Sales growth in the UK was 16% and the EU 10%, which was not as good as hoped, due to weakness in German and French markets.
Growth in the US was also behind target, at just 4%.
Chief executive Nick Beighton said the company was “capable of a lot more”.
In a report on the results, the company said it had almost completed a “record period of investment” in technology and logistical infrastructure and the benefits from this would be realised in the second half of the year.
Investments have also been made in the EU and US that would improve capability, customer experience and productivity, it said.
The retailer said “large-scale transformational projects” and “some of the choices we made on short-term pricing” were among the reasons for the downturn.
The results come less than a month after the firm’s shares plunged on news of “challenging” conditions in France and Germany.
Sales in the US were also hit by teething problems at a new warehouse in Atlanta, where demand “far exceeded our expectations”, Mr Beighton said at the time.
On Wednesday, he said: “Global online fashion is a growing, £220bn+ market.
“We now have the tech platform, the infrastructure, a constant conversation with our growing customer base who love our own great product and the constantly evolving edit of brands we present to them.
“We believe that ultimately there will only be a handful of companies with truly global scale in this market.
“We are determined that ASOS will be one of them.”
ASOS shares were up by 7% in early trading.
Fiona Cincotta from trader City Index said ASOS’s “growing pains have been laid bare”.
She added: “To be fair, the company is navigating a tough retail environment, though even management has admitted that it hasn’t always gotten it right on pricing, marketing, inventory management and staffing levels.
“ASOS had already announced last month that it was unable to cope with an unexpected surge in demand at its new US business.
“Today, management has revealed that the issue was related to a staffing shortage, rather limited technical capabilities.
“Online retailing is hyper-competitive and any more hiccups like this will be hard to forgive.”