AO profits hit by German launch

APPLIANCES retailer AO World has reported a sharp drop in profits after the cost of its launch in Germany offset a 25 per cent jump in half-year sales.

By The Newsroom

Published 25th Nov 2014, 13:23 BST

The Bolton-based online business said pre-tax profit fell to £779,000 in the six months to the end of September from £2.1m a year ago, after incurring £3.3m of costs from the October launch of its German business.

The firm, which sells washing machines and fridges and was launched in 2000 by founder and chief executive John Roberts, said total sales for the period were up by just over a quarter to £217.1m.

AO World’s new unit was launched six months ahead of schedule and it said that although customer feedback is positive, German trading losses will reduce group trading profit for the full year.

Chief executive Mr Roberts said: “Although Germany has only been operating a number of weeks, we are delighted with the way our culture has transferred, with the way it’s operating and with the way sales are building.”