Bolton-based online retailer AO World has reported wider pre-tax losses as narrowing gross margins and increased costs in Germany offset stronger performance in the UK.
For the year ended to the end of March, the company saw pre-tax losses rise to £18.9m, from £13.5m a year earlier, while revenue increased 3.3% to £902.5m.
Total UK revenue was up 10.1% to £749.3m, and Europe revenue grew by 32.2% to €173.3m, but overall performance was hampered by “driver challenges in Germany and a lack of real improvement in product margin and customer acquisition costs”.
Gross margin fell to 17.0% for the year, down 0.8% year on year, with total gross profit increasing by 7.5% to £152.3m.
John Roberts, AO founder and CEO, said: “We’ve delivered double digit revenue growth in the UK and achieved over 30% in Europe and adjusted EBITDA in the UK has improved by over 20%.
“The UK result was achieved against an ongoing tough trading environment and includes three months contribution from Mobile Phones Direct which we acquired in December 2018 and its integration continues to go to plan.
“Overall, the AO team deserve praise for their efforts in FY19 but we can do better and I’m pleased with the progress that we are now making in the first few months of this financial year.”
