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AO World revenues surge 17% with strong EU performance, more categories
Online electrical products retailer AO World reported much improved European sales and revenues from its UK business up 11.4% over the last three months of the year in spite the "fiercely competitive" trading environment.
AO.com enjoyed the double-digit domestic sales growth despite a decrease in marketing expenditure, driven in part by its two-week-long Black Friday sales and the recent extension of its range into mobile phones, smart home devices and games consoles.
Over on the continent, Premier saw revenue continue on its upward trajectory, up 58.4% year-on-year on a constant currency basis. Putting the two together, overall group revenue increased 16.6% for the quarter.
AO anticipated that the firm's overall performance for the full year would fall within analysts' expectations, however, the company remained cautious given the state of uncertainty surrounding Britain's economic outlook.
Chief executive Steve Caunce said, "We have performed well over our peak period delivering further sales growth across all our territories and are on track with our long-term strategy."
"Looking ahead, although we need to be mindful of the uncertain economic outlook (particularly in the UK), as long as we are relentless in our focus on making things easy for our customers, we can be confident that they will continue to choose the AO Way," he added.
Analysts at Numis Securities applauded AO's third-quarter update on Thursday, reiterating their 'buy' rating and target price of 200p. "Clearly, with AV and technology over-indexing around Black Friday, this result would have been boosted by growth in new categories, but we are confident that AO also took market share in core MDA categories over the period," the analysts noted.
As of 0920 GMT, shares had grown 1.30% to 132.70p.