Shares in the online appliance retailer AO World have taken a tumble after the company revealed a pre-tax loss of £2.9m.
AO World fell sharply on Tuesday to close at 170p after it revealed worse-than-expected trading figures for its first year as a listed company.
AO said the outlook in the UK remained challenging but insisted that it was well positioned to compete.
AO World’s share price has been battered since it entered the stock market in February 2014, valued at £1.2bn, despite profits of less than £8m that left many people scratching their heads or just in stunned disbelief. Then the company was forced to issue a profits warning in February when it admitted it may have been a victim of flotation hype.
Since then the sell-off has continued, led by chairman Richard Rose, who offloaded 5.58m shares in March. He sold the shares for 180p, a hefty discount to AO’s float price of 285p when it joined the stock market last year.
AO World reported revenues of £477m for the year ending 31 March, up 24% on last year. Website sales for the UK rose 33% to £382m. But the firm was dragged into loss-making territory as it spent money on building a web presence in Germany.
John Roberts, AO World’s chief executive, said he was pleased with the firm’s progress in Germany.
“Our long-term plan is on track and, despite missing our financial expectations for the year, we have continued to take market share in the UK MDA [major domestic appliances] market.”
