4th Apr 2019 08:41
LONDON (Alliance News) - AO World PLC on Thursday guided for its annual adjusted earnings to come in towards the lower end of market forecasts despite reporting a performance "in line" with views.
Shares in the company were trading down 3.5% at 93.60 pence each early Wednesday morning.
Market estimates earnings before interest, taxes, depreciation and amortisation for the year ended March 31 to be between GBP2.0 million profit and a GBP400,000 loss, according to the technology retailer. Consensus is seen at GBP700,000 profit.
AO World expects to incur exceptional costs of around GBP2.5 million in financial 2019 due to costs associated with the restructuring of its management team and charges for a loss making contract in Germany, which the firm is unable to terminate.
Revenue is expected at GBP900 million, up 13% year-on-year and in line with consensus range of between GBP876.0 million and GBP904.2 million.
In the UK, the retailer's core market, revenue is expected to rise 9.8% year-on-year to GBP748 million. While in Europe, AO World guided for revenue increase of 32% to EUR174 million.
With regards to the UK's exit from the European Union, AO World said it has stockpiled around GBP15 million worth of inventory as part of a contingency plan. This produced a corresponding impact on the company's cash position, it added, but will ensure continued delivery.
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