AO World has hailed a record performance after its profits surged nearly 30% driven by cost-saving initiatives and strong growth of its membership scheme.
Adjusted pre-tax profits for the electricals specialist rose 27% to £44m for the year to 31 March, coming in at the top end of its £39m to £44m guidance.
This was driven by a 9% increase in group sales to £1.13bn and several cost-saving efficiencies, including the introduction of a new third-party warehousing solution in its distribution centre.
AO benefited from returning customers, which accounted for over 60% of orders during the year. It expects this trend to improve over time.
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AO trust pilot rating
Electrical retailer AO.com recently reached an incredible trust pilot rating of 4.9 out of 5, from almost 750,000 reviews
AO profit
AO World swung to profit in its half-year results as it removed unprofitable sales and introduced charges on all deliveries.
The electricals retailer made a £13m pre-tax profit, compared to a £12m loss last year as it upgraded its profit guidance from £28m to between £28 to £33m for the year.
Adjusted EBITDA rose from £9m last year to £27m for the six months ended 30th September 2023.
Sales fell 12% to £482m as a result of it stripping out unprofitable sales, however it expects to return to revenue growth by the end of the year.
The retailer’s gross margin improved to 23.5% compared to 19.5% last year.
Frasers getting into appliance retail
Frasers has upped its stake in AO World and Currys as it continues its acquisition spree.
The Mike Ashley owned group raised its holdings in the Bolton-based online electrical retailer for the third time this month to 22.2% from 21.3%.
It also lifted its shareholdings in Currys to 10.4%, which it said last week was part of a “strategic investment” as it looks to increase its “foothold in the electricals industry”.
AO.com most trusted retailer
AO.com is the UK’s most trusted major electricals retailer
Recently AO.com passed the incredible milestone of 400,000 reviews on Trustpilot, and we are delighted that so many of these reviews are four and five stars – 93% to be exact
It means that when it comes to major UK electricals retailers, AO.com has the largest volume of ⭐⭐⭐⭐⭐ reviews – with more than Currys, Argos and John Lewis combine
AO on the mend
Online electricals retailer AO World has hiked it annual earnings outlook for the third time in just over three months as it said cost-cutting efforts were paying off.profitability has seen a better-than-expected improvement as it drives cost savings thanks to a “resilient” customer base.Expects underlying earnings to be in the range of £37.5 million to £45 million for the full year, up from the £30 million to £40 million guided for last month.AO World slumped to a £12 million loss in its first half, with shares hammered last year following a series of profit warnings as the cost crisis hit consumer spending on white goods, and due to labour shortages and supply chain disruptionThe company started its turnaround plan with a £40 million fundraising round last summer in a bid to strengthen its balance sheet amid fears of a cash crunch.
AO has closed its loss-making German operation as part of the shake-up and has launched action to save at least £30 million a year by 2023-24 – including by recently axing senior and middle management jobs.
The firm has also ditched unprofitable products while introducing delivery charges and cutting cashback incentives to reduce the cost of sales.
AO raises profit outlook despite 17.2% drop in UK sales
AO has increased profit expectations, despite a 17.2% decline in sales at its core UK business in the third quarter.
The electricals retailer said this was in line with management expectations.
AO new board member
Ex-Pets at Home chief executive Peter Pritchard join’s AO board as an independent non-executive director
AO loss of £37 Million
Online electrical retailer AO.com posted a full-year pre-tax loss of £37million, compared with a profit of £20million for the same period last year. The group expects sales to fall go £1billion to £1.25billion in its current year, down from £1.56billion last year.The electricals specialist has also signed a new five-year contract with Homebase to supply appliances and installation and recycling services to its customers
AO Pullout from Tesco
The electricals retailer’s first foray into physical retail, AO.com’s in-store trial with Tesco, has come to an end.
In the fall of 2020, the online retailer opened five concessions within Tesco Extra stores. However, Covid lockdowns interrupted the trial, and the shop-in-shops were cordoned off as they were considered non-essential retail.
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