LONDON (Reuters] – British online fashion retailer ASOS, LON:, reiterated on Thursday that it had already reduced its outlook due to supply chain challenges and volatility in demand. This resulted in sales growth being limited for the period of four months ending December 31st.

The company posted an increase of 5% in total sales, after a 22% year-end growth. However, gross margins fell 400 basis points from 43.0% to 43.0% due to the necessity to sell discounted goods and incur higher freight cost.

The company reiterated its expectations for revenue growth between 10% and 15% as well adjusted profit after tax of 110million pounds to 140million pounds. This would have a significant impact on its share price and represent more than 40% decrease in revenue compared to the previous year.

Mat Dunn, chief operating officer, said that ASOS delivered a solid start to the new year. This was in keeping with the guidelines we gave at the full-year results despite difficult market conditions.

ASOS was once the darling stockmarket company. However, it suffered a hard end in 2021 when it had to cut its profit forecast for the year and part ways with its CEO. This happened due to supply chain pressures, and shoppers returning to their pre-pandemic days.

Even though shoppers are more likely to return fashion and partywear, it can be costly for the company. However, athleisure clothing purchased in the pandemic was retained by the company to keep at home. This gave them an additional boost to their finances, which allowed the company to continue lockdowns.

Its shares have fallen 56% since the last update on Thursday. This is similar to falls at Boohoo. Boohoo has been also hit hard by high product returns, disruptions in international deliveries, and increased freight costs.

ASOS also stated that it would be moving to LSE’s principal stock exchange, which is expected to happen by February end.