Published on July 21st, 2017 | by The GC Team0
AO defies MDA market slowdown
AO World today reported that its core AO website sales in the UK rose 6.2% year on year for the quarter ended 30th June 2017, despite the challenges of a Brexit-induced slowdown and a robust performance in the comparable period last year, which was driven in part by changes to stamp duty on housing transactions at the end of March 2016.
Overall UK revenue growth in the quarter was 2.5%. The company said this reflected the expected reduction in third party website and logistics sales year on year as it focuses on the AO brand.
Chairman Geoff Cooper commented that the UK trading environment remains “challenging” with the MDA market overall seeing lower volumes year on year in Q1.
Earlier this week, MDA manufacturer Electrolux reported a rise in second-quarter profits but said demand in the UK continued to decline.
AO World said it remains on track with its long-term strategic plan and the board expects results for the full year to fall within the range of market expectations.
“Customer satisfaction,” said Cooper, “continues to be exceptional in all of our territories and the rollout of further categories across the UK and Europe continues.”
He added: “Our Europe segment has performed in line with our plan during the first quarter of the new financial year, with strong year-on-year revenue growth of 57.6% in local currency (up 73.1% on a sterling basis), with limited above-the-line marketing as planned.
“Our momentum is encouraging and we remain confident in the delivery of the plan we set out at our capital markets day in February.”
The company’s half year results for the six months ending 30 September will be announced on 21 November 2017.