25th Mar 2025 07:00
This announcement may contain inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is disclosed in accordance with the Company's obligations under Article 17 of MAR. Upon the publication of this announcement via the Regulatory Information Service, any inside information will be considered to be in the public domain.
25 March 2025
AO WORLD PLC
Full Year Pre-Close Trading Update for FY25
Profit1up c30% and around the top end of guidance range
Double digit B2C Retail revenue growth forecast again for the year ahead
AO World plc ("the Company" or "AO"), the UK's most trusted electricals retailer, today issues the following update for the 12 months to 31 March 2025.
B2C Retail revenues are expected to increase by c12% YoY, with estimated LFL Group revenues2 expected to increase c7% YoY to £1.1bn, reflecting reductions in B2B and mobile as we focus on profitable growth as set out in the half year results in November.
Adjusted profit before tax1 has grown faster than sales, in the region of 30%, and is expected to be around the top end of our previously upgraded guidance range of £39m to £44m.
At the period end we expect to have net funds on a pre IFRS16 basis of around £20m, after the outflow of c£25m for the acquisition of musicMagpie plc ("musicMagpie"). The Company extended its revolving credit facility in the period from £80m to £120m to October 2028 on more favourable terms, and it remains undrawn.
On 12 December 2024, the Company successfully completed the acquisition of musicMagpie. The post-acquisition performance of musicMagpie is expected to contribute around £30m of revenue and a negligible loss to the FY25 results.
Looking ahead to FY26, our current momentum means we expect our B2C Retail business will deliver another year of double-digit revenue growth and our other revenue categories to be broadly flat. Despite the wider economic uncertainty and cost headwinds from the Government's budget we again expect adjusted PBT to continue to grow faster than sales.
We are pleased today to also announce that we have appointed Mark Higgins to Chief Operating Officer (in addition to his existing role of Chief Financial Officer), reflecting the way Mark and John have been running the business together for some time.
John Roberts, AO's CEO and Founder, commented:
"Our strong performance shows that our model is working. With a globally leading Trustpilot score of 4.9 from almost 750,000 reviews, and AO Five Star membership continuing to grow strongly, we're cementing our position as the most trusted electrical retailer and are increasing our frequency and share of wallet with customers.
"AO is back to being a highly efficient growth machine; we are reaping the rewards from the execution of our strategy and 25 years of unwavering obsession with amazing customer service.
"We're carrying good momentum into the new financial year and are pleased to be guiding to another year of double-digit revenue growth in our B2C Retail business, and for profits to keep growing faster than sales."
AO expects to publish its Full Year Results to 31 March 2025 on 18 June 2025.
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AO World plc
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John Roberts, Founder and Chief Executive | |||||||||||||||||
Mark Higgins, Group CFO & COO
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Sodali & Co
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Tel: +44 (0)20 7250 1446 | ||||||||||||||||
Rob Greening Russ Lynch | |||||||||||||||||
1 Adjusted PBT is defined as a profit/(loss) before tax, adjusted for any non-recurring items as defined by the Board. Specifically this will include two adjusting items, firstly the expenses surrounding the acquisition of Music Magpie of £3.3m. Secondly the market has continued to deteriorate for post pay mobile connections, and as highlighted in the interim results a worsening of this position would likely result in an impairment of goodwill and intangible fixed assets in our Mobile Cash Generating Unit. We will continue to work with our auditor, KPMG to finalise this in our financial statements but the potential impairment charge could be up to the full £22m of goodwill and intangibles held on the balance sheet.
2 Based on unaudited management accounts. AO World's financial year FY25 runs from 1 April 2024 to 31 March 2025 and LFL excludes the impact of musicMagpie.
About AO AO World PLC, headquartered in Bolton and listed on the London Stock Exchange, is the UK's most trusted major electricals retailer, with a mission to be the destination for electricals. Our strategy is to create value by offering our customers brilliant customer service and making AO the destination for everything they need, in the simplest and easiest way, when buying electricals. We offer major and small domestic appliances and a growing range of mobile phones, AV, consumer electricals and laptops. We also provide ancillary services such as the installation of new and collection of old products and offer product protection plans and customer finance. AO Business serves the B2B market in the UK, providing electricals and installation services at scale. AO also has a WEEE processing facility, ensuring customers' electronic waste is dealt with responsibly. |
Cautionary statement This announcement contains certain forward-looking statements (including beliefs or opinions) with respect to the operations, performance and financial condition of the Group. These statements are made in good faith and are based on current expectations or beliefs, as well as assumptions about future events. By their nature, future events and circumstances can cause results and developments to differ materially from those anticipated. Except as is required by the Listing Rules, Disclosure Guidance and Transparency Rules and applicable laws, no undertaking is given to update the forward-looking statements contained in this document, whether as a result of new information, future events or otherwise. Nothing in this document should be construed as a profit forecast or an invitation to deal in the securities of the Company. This announcement has been prepared for the Group as a whole and therefore gives greater emphasis to those matters which are significant to AO World plc and its subsidiary undertakings when viewed as a whole. |
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