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AO World plc (AO), renowned as the UK's leading electrical retailer, has released its audited financial results for the fiscal year ended March 31, 2024 (FY24), showcasing robust profit performance and strategic advancements.
Financial Performance Highlights
The Group's financial achievements reflect its focused strategy on profitability and cash generation, marking a significant turnaround as it positions for sustained growth:
- Adjusted Profit Before Tax: The Group reported an adjusted profit before tax of £34.3 million for FY24, marking an impressive increase of £22.3 million year-over-year. This achievement underscores the successful execution of AO's strategic plan to enhance profitability.
- Revenue Performance: AO demonstrated resilience in revenue performance, aligning with expectations following strategic decisions to streamline non-core channels and eliminate loss-making sales. The fourth quarter marked a return to growth, indicating a positive trajectory moving forward.
- Balance Sheet Strength: AO strengthened its financial position with robust liquidity, reporting overall liquidity of £116 million as of March 31, 2024, compared to £89 million in the previous year. Net funds increased significantly to £34.4 million, up from £3.6 million in FY23, reflecting prudent financial management.
- Credit Facility Extension: The Group extended its £80 million Revolving Credit Facility until April 2027, enhancing financial flexibility and supporting future growth initiatives.
Outlook for FY25 and Beyond
Despite prevailing macro-economic challenges, AO remains steadfast in its strategic objectives and optimistic about future prospects:
- Revenue Growth Ambition: AO aims for double-digit revenue growth in FY25, building on its strengthened operational foundation and market position.
- Profitability Targets: The Group anticipates adjusted profit before tax in the range of £36 million to £41 million for FY25, underscoring its commitment to sustainable profitability. AO reaffirms its medium-term guidance of achieving an adjusted PBT margin of 5%, with earnings per share (EPS) growth outpacing revenue growth.
Strategic Direction
Looking ahead, AO will continue to focus on enhancing operational efficiencies, expanding its product offerings, and leveraging digital platforms to drive customer engagement and satisfaction. The Group remains agile in responding to market dynamics while maintaining a disciplined approach to capital allocation and cost management.
