AO World reports 25% rise in revenues and says it's growing as fast as is safe
AO World today reported revenues up by a quarter in its latest financial year, and said it was growing as fast as was safe to do so.
The white-goods-to-home-electricals pureplay, which already sells in Germany and expanded into the Netherlands market in March, said it would launch sales of computing equipment later this year. Chief executive John Roberts promised "a different approach to the traditional 'feature-led' way of selling this category, to the benefit of all customers."
He said: "We have continued on our journey to become the best electrical retailer in Europe, having grown our market share in all our categories and expanded the AO brand into our next country, the Netherlands. We are growing the business as fast as we can safely; expanding in our chosen categories and countries, whilst keeping a tight grip on our culture. Improving our brand awareness has been a key focus over the last year and this has increased significantly following successful investment in marketing; helping us attract new customers and improving repeat business metrics."
The update came as AO World reported revenues of £599.2m in the year to March 31, 25.7% up on the same time last year.
In the UK, AO.com website sales reached £487.1m, 27.7% up on last time, but sales from the white label sites it runs for other businesses declined by 23.7% to £70.3m, while income from third-party logistics services fell by 6.5% to £17.8m. This reflects a focus on growing its own direct sales – 88.1% of group sales now come from AO-branded websites in the UK, Germany and the Netherlands, as well as on eBay – and held UK sales growth back at 18.6%.
Operating losses of £10.6m, up from £2.2m last time, were put down to investment, including a regional office and distribution centre in Germany, and start-up costs of £2.3m for other European operations. Capital expenditure of £8.7m included investment in logistics. After one-off costs, pre-tax losses came in at £6.7m, widening from £2.9m last time.