Thirdquarter revenue down 14
Core earnings rose over 20 mln stg
Keeps guidance for second half
Shares up 14

LONDON, June 15 Reuters British online fashion retailer ASOS on Thursday reported a 14 drop in quarterly revenue but said its new strategy was starting to work as it returned to profitability, sending its battered shares higher.

The group led by CEO José Antonio Ramos Calamonte announced an overhaul of its business model last October after the economic crunch and a string of operational problems hammered its profits.

His strategy is to prioritise profit over topline growth by revamping the retailer39;s supply chain, cutting costs and increasing innovation.

ASOS said core earnings, or adjusted earnings before interest and tax adjusted EBIT rose more than 20 million pounds 25.3 million in the three months to May 31, its fiscal third quarter. It did not disclose the actual adjusted EBIT figure for the quarter.

It said EBIT margin was up 250 basis points, ahead of guidance of 200 basis points for the second half.

ASOS39;s inventory was down about 15 in the quarter, consistent with its target of a 20 reduction over the full year, with 86 of stock less than 12 months old.

The group, whose shares have lost 71 of their value over the last year, had already said last month that sales had fallen about 15 in March and April when it reported a first half loss and guided to a low double digit sales decline for the second half.

The stock was up 14 in early trading….