Saturday 22 September 2018

AO World sees full-year revenues rising despite tough conditions

The firm said that sales are set to come in at £796 million – an increase of 14%.

AO World expects revenue to grow (PA)
AO World expects revenue to grow (PA)

By Ravender Sembhy, Press Association City Editor

Online retailer AO World expects to report a 14% increase in full-year sales, despite a tough market and fewer promotions.

The firm said that revenues are set to come in at £796 million, slightly above the mid-point of market expectations.

In the UK, AO World said turnover is forecast to increase 8% to £680 million following growth in the fourth quarter.

“Growth in the fourth quarter was achieved in what remains a competitive market with limited advertising spend.

“When compared to this period in the previous year we have undertaken relatively less promotional activity which has supported gross margin,” the group said.

Last year AO World signalled a sharp slowdown in its UK business as the Brexit-induced slowdown in consumer spending gripped the retail sector.

Boss Steve Caunce said at the time that trading in the UK had become more challenging as “we began to feel the impacts of dampening consumer confidence following the UK’s vote to leave the EU, subsequent price inflation and a slowdown in the UK housing market”.

Revenue growth in Europe came in at 55% as AO World said it has reached an “inflection point” on the continent, with further progress expected.

However, the firm will still book an adjusted operating loss of around £4 million, it added.

Press Association

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