20th Nov 2018 10:06
LONDON (Alliance News) - AO World PLC said Tuesday that a "tougher than expected" domestics appliances market led to a widened first half loss, despite revenue growth.
AO World shares were trading down 6.3% at 116.40 pence each.
For the six months ended September 30, the online electrical retailer posted a pretax loss of GBP10.3 million versus GBP9.6 million a year ago. Administrative costs increased to GBP83.6 million from GBP81.1 million, contributing to the widened loss.
Loss before interest, taxes, depreciation and amortisation widened to GBP6.3 million from GBP5.4 million a year ago, while operating loss shrunk slightly to GBP11.7 million from GBP12 million last year.
However, revenue for the period increased 9.9% to GBP404.2 million from GBP368.0 million a year prior.
UK revenue was up 5.7% to GBP334.8 million from GBP316.8 million. Meanwhile, Europe saw revenue up 36% to GBP69.4 million from GBP51.2 million.
"This has been a half of continued delivery against our long-term strategy, thanks to a strong offer for customers. While our core UK and Germany Major Domestics Appliances (MDA) markets have been challenging, with the UK MDA market becoming tougher than expected, we take encouragement that we are at least maintaining market share in this core category in the UK and growing significantly in Germany," Chief Executive Steve Caunce said.
He added: "Elsewhere, our continued focus on growing our range of online electricals and adding new complementary ranges proved successful in the first six months of the year, with newer categories such as Audio Visual and Computing performing particularly well."
Looking ahead, the company, which is currently in its peak trading period with Black Friday and Christmas ahead, said it remains confident of "achieving long-term sustainable growth across the group".
"We expect full year results to fall within the range of board expectations, albeit more second half weighted than previously anticipated," Caunce added.
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