UK and Europe revenues soar for AO.com

AO World plc (AO.com) has reported of “continued growth and a renewed mindset”, after it announced its latest financial results.

The retailer saw total revenue for the period – which covers the 12 months for the year ended 31 March 2019 – increasing by 13.3 per cent to £902.5m, against a backdrop of “ongoing weak consumer confidence in a continuingly competitive market, particularly in the UK”, the report stated.

Total UK revenue was up 10.1 per cent to £749.3 million, compared to £680.8 million in 2018. This figure was up 5.7 per cent on a like for like basis, excluding revenues from the newly acquired mobile phones business. Europe revenue for the period increased by 32.2 per cent.

Meanwhile, UK adjusted EBITDA improved by 20.9 per cent to £27.4m, up nearly £5 million from 2018.

AO’s customer base grew last year to nearly 6.5 million customers in the UK, according to this latest report, and its MDA share maintained a double-digit growth in all new categories in the UK.

In addition, the retailer announced it is refocussing on growing its third-party logistics business to leverage its two-man delivery expertise, infrastructure and capacity.

It has also commenced building a plastics refining facility, due to be operational next year, which will provide the capability to sort waste plastics from its fridge plants “to create an additional sustainable revenue stream”.

Lastly, AO recently launched a trial rental services for white goods in partnership with two Housing Associations and running a small B2C trial via ao.com.

John Roberts, AO Founder and Chief Executive Officer, said: “The AO model is an eco-system of complementary competencies across retail, mobile, recycling and logistics through to financial services and B2B trade. We have huge structural advantages when these capabilities operate in harmony. So, we have enhanced structure with informality and a renewed mindset and are now releasing the immense unrealised value we’ve created. We’ve started to see this in the last few months and it will be an important driver for the year ahead.

“Overall, the AO team deserve praise for their efforts in FY19 but we can do better and I’m pleased with the progress that we are now making in the first few months of this financial year. I’m proud to be back at the helm of the business I founded almost two decades ago and I’m more excited than ever about the future for AO.”