TIDMAO.

RNS Number : 7776Z

AO World plc

27 January 2022

This announcement may contain inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is disclosed in accordance with the Company's obligations under Article 17 of MAR. Upon the publication of this announcement via the R01egulatory Information Service, this inside information is now considered to be in the public domain.

27 January 2022

AO WORLD PLC

Trading update and Strategic Review of the German business

AO World plc ("the Group"), a leading European online electricals retailer, today issues the following trading update for the period ended 31 December 2021 and announces a strategic review of its German business.

 
 Revenue growth(1)        9 mths     9 mths         Q3         Q3 
                         2yoy(2)    1yoy(3)    2yoy(4)    1yoy(5) 
 Group revenues             +58%       (3)%       +45%      (14)% 
 UK revenues                +58%       (1)%       +47%      (12)% 
 Germany revenues(6)        +67%       (8)%       +35%      (24)%

The Group confirms that current trading estimates for the full year remain in line with the guidance set out at the Interim Results on 23 November 2021. On a comparable two-year period for the nine months to 31 December, UK revenues grew 58%. On a one-year comparative, which covered the Covid-related government lockdowns in the previous year, UK revenues were broadly stable, despite supply chain constraints and driver shortages. In Germany, on a comparable two-year period for the nine months to 31 December, revenues grew 67%(6) . On a one-year comparative in Germany for the same period, revenues declined 8%(6) .

Our German business is being significantly impacted by a number of recent material changes to the local trading environment: competition in the online market has intensified whilst online penetration has returned to pre-pandemic levels; digital marketing costs have substantially increased against pre-pandemic levels; and supply remains constrained. We expect these trends will continue for the foreseeable future in the German market.

The Board is focused on maximising shareholder value, and as a result of the aforementioned factors, the Group has decided to commence a strategic review of its German business, which will evaluate a range of options. The results of the review will be announced in due course.

We remain confident about AO's long-term growth prospects, driven by the strength of our proven business model, the quality of our customer proposition, and the long-term market trend towards online migration.

AO World will announce its full year results to 31 March 2022 on 15 June 2022.

 
 Enquiries 
 AO World plc                                                      +44 (0)7525 147 877 
 John Roberts, Founder and Chief                                             IR@AO.com 
  Executive 
 Mark Higgins, Group CFO 
 Cynthia Alers, Investor Relations Director 
 
 Powerscourt                                                  Tel: +44 (0)20 7250 1446 
 Rob Greening                                                 ao@powerscourt-group.com 
  Nick Hayns 
  Sam Austrums 
 
 Notes 
  (1) Based on unaudited management accounts. AO World's financial 
  year FY22 runs from 1 April 2021 to 31 March 2022. 
  (2) Covers the nine months 1 April to 31 December 2021 compared 
  to the equivalent period in FY20. 
  (3) Covers the nine months 1 April to 31 December 2021 compared 
  to the equivalent period in FY21. 
  (4) Covers the three months 1 October to 31 December 2021 
  compared to the equivalent period in FY20 
  (5) Covers the three months 1 October to 31 December 2021 
  compared to the equivalent period in FY21 
  (6) Based on euros constant currency. On a sterling basis, 
  revenue growth for each period is: 
                9 mths   9 mths      Q3      Q3 
                  2yoy     1yoy    2yoy    1yoy 
               -------  -------  ------  ------ 
   Germany 
    revenues      +63%    (12)%    +34%   (28)% 
 
 
  About AO 
  AO World plc, headquartered in Bolton and a constituent of 
  the FTSE Small Cap index, is a leading online electrical retailer. 
  Our strategy is to create value by offering our customers 
  brilliant customer service and making AO the destination for 
  everything they need, in the simplest and easiest way, when 
  buying electricals. 
 
  In the UK, we sell major and small domestic appliances and 
  a growing range of mobile phones, AV, consumer electricals 
  and laptops, delivering them via our in-house logistics business 
  and carefully selected third parties. We also provide ancillary 
  services such as the installation of new products and recycling 
  of old products as well as offering product protection plans 
  and customer finance. AO Business serves the B2B market in 
  the UK, providing electricals and installation services at 
  scale. AO launched in Germany in October 2014 selling major 
  and small domestic appliances, AV and electrical floorcare 
  products. AO also has a majority equity stake in AO Recycling, 
  a WEEE processing facility, allowing AO to ensure its customers' 
  electronic waste is dealt with responsibly in the UK. 
 
   Cautionary statement 
   This announcement contains certain forward-looking statements 
   (including beliefs or opinions) with respect to the operations, 
   performance and financial condition of the Group. These statements 
   are made in good faith and are based on current expectations 
   or beliefs, as well as assumptions about future events. By 
   their nature, future events and circumstances can cause results 
   and developments to differ materially from those anticipated. 
   Except as is required by the Listing Rules, Disclosure Guidance 
   and Transparency Rules and applicable laws, no undertaking 
   is given to update the forward-looking statements contained 
   in this document, whether as a result of new information, 
   future events or otherwise. Nothing in this document should 
   be construed as a profit forecast or an invitation to deal 
   in the securities of the Company. This announcement has been 
   prepared for the Group as a whole and therefore gives greater 
   emphasis to those matters which are significant to AO World 
   plc and its subsidiary undertakings when viewed as a whole. 
   ENDS

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