UK DIY News
AO World Begins Strategic Review of 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 growth1 | 9 mths 2yoy2 | 9 mths 1yoy3 | Q3 2yoy4 | Q3 1yoy5 |
Group revenues | +58% | (3)% | +45% | (14)% |
UK revenues | +58% | (1)% | +47% | (12)% |
Germany revenues6 | +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.
Source : AO World PLC
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