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AO interims show 2-year sales growth of 67%

AO’s results for the six months ended 30 September 2021 show total Group revenue of £760m, representing 6% year on year sales growth and 67% growth compared to the same period in 2019. However, logistical challenges have kept profits low with a £10million loss before tax, compared to £18m profit in the same period last year.

Financial highlights

  • Group revenue growth of 67% over two-year period, including 88% revenue growth in Germany on a local currency basis
  • Group EBITDA impacted in HY22 by the investments in systems and people (in particular drivers) and increased marketing costs
  • Group operating loss of £11m (HY21: profit of £16m)
  • Overall liquidity of £66m (HY21: £161m). Net debt at 30 September 2021 of £102.2m (31 March 2021: £28.1m; 30 September 2020: £20.7m)

Operational highlights

  • Over 780,000 new customers. Reported “notable step changes in post-Covid repeat purchase rates”
  • c.500 new drivers recruited to meet peak period demand, bringing our fleet up to full strength and easing the previously reported shortage of drivers
  • Five new outbases opened across UK and Germany; over 300,000 sq ft new warehousing added
  • Third Party Logistics revenues grew 38.5% with three new contracts in Germany
  • 300,000 Trustpilot ratings, averaging an excellent 4.6 out of 5 stars and Net Promoter Scores averaging over 80
  • Over 2 million fridges have now been recycled at our AO Recycling facility and we are now working with manufacturers to use our recycled plastic in new products

Outlook

  • Growth in the UK has been impacted by the nationwide shortage of delivery drivers and ongoing disruption in the global supply chain
  • German online market has seen significantly increased competition.
  • Ongoing supply chain challenges with poor availability in certain categories, particularly in our newer products where we have less scale, experience and leverage.
  • Shipping costs, material input prices and consumer price inflation remain challenging uncertainties.
  • Current peak trading period is significantly softer than we anticipated only eight weeks ago.
  • Expect full year Group revenue to be flat to minus 5% year on year
  • Expect Group Adjusted EBITDA in the range of £10m to £20m.

Read the Statement here

(Link goes to AO World website)

Image credit: Michael Kramer


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