AO World says the “tough” time it feared for trading hasn’t been quite so bad after all.
The Bolton-based online electrical retailer released a trading update this morning, updating its profit guidance to the “top end” of the £37.5m-£45m figure it predicted in February.
The statement added that it was continuing to reduce costs and improve margins.
“The potential adverse effects from trading risks, continuing macroeconomic uncertainty and tough consumer environment that we anticipated at 28 February have not materialised to the extent envisaged.”
“We are encouraged by the work undertaken to pivot the business during the financial year 2023,” said John Roberts, CEO and Founder.
“AO enters the new financial year with net funds on the balance sheet, a robust trajectory, and full confidence in our ability to deliver on our medium-term profit guidance of 5% adjusted EBITDA. We anticipate that our progress in improving both operational cost efficiencies and margin in FY23 will continue through the next 12 months and beyond.”
It’s been a few years of major change for AO, which saw revenue and profits shoot up during the Covid-19 pandemic as increasing numbers of consumers went online. At the time Roberts believed that people “wouldn’t return to their old ways.”
That prediction didn’t quite come true, with 2022’s figures seeing revenue fall 6% and a £37m loss compared to a £20m profit in 2021. Its full year results are due to be released on 14th April.