Published on April 4th, 2019 | by The GC Team0
AO stockpiles for Brexit
Online retailer AO World today said it has increased fast-moving stock levels as part of Brexit contingency planning.
In a trading update for the twelve months to 31 March 2019, the company said full-year performance is expected to fall within the range of current market forecasts, with Group revenue increasing 13% to c.£900 million – up 9% excluding Mobile Phones Direct Limited, which the company acquired at the end of last year – but Group adjusted EBITDA, excluding exceptional costs, is expected to be at the lower end of market expectations, at £0.7m with a range of £‐0.4m to £2.0m.
UK revenue is predicted to be around £748m, up 9.8% year on year (5.4% excluding Mobile Phones Direct), while revenue growth in Europe is expected to be 32.3% for the year at c.€174m.
The business said it increased its fast-moving core inventory levels by around £15m during the last quarter, with a corresponding impact on its cash position, as part of Brexit contingency planning.
The company also took a £2.5m hit due to the restructuring of its management team following the re‐appointment of John Roberts as CEO in January this year, together with charges for a loss-making contract which it was unable to terminate in Germany.
These costs are in addition to previously disclosed one‐off costs incurred in connection with the acquisition of Mobile Phones Direct Ltd in December 2018 and exceptional share‐based payment charges.
Further details will be disclosed in AO’s preliminary statement on 4 June 2019.