AO World ‘back to being a highly efficient growth machine’ after musicMagpie purchase – UKTN

The boss of AO World has said it is “back to being a highly efficient growth machine” after reporting a rise in profits.

The Bolton-based ecommerce business, which sells TVs, kitchen appliances and computers, said its retail revenues were expected to increase by 12% for the year to end March, while overall sales would rise to £1.1bn.

The firm said its profit before tax has grown faster than sales, in the region of 30%, and is expected to be around the top end of previously upgraded guidance range of £39m to £44m.

In December the firm completed the acquisition of musicMagpie, which buys and sells consumer tech, for £25m. AO World said it expected musicMagpie to contribute around £30m of revenue and a “negligible loss” to its overall results.

The company forecast that its B2C Retail business will deliver another year of double-digit revenue growth and our other revenue categories to be broadly flat, with profits continuing to grow faster than sales.

“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,” said CEO John Roberts.

“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 World’s share price rose 3% to 99p in early London trade. The stock is up around 10% over the past year.

The company today also announced the appointment of Mark Higgins to Chief Operating Officer, in addition to his existing role of Chief Financial Officer, a move which the firm said was “reflecting the way Mark and John have been running the business together for some time.”

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