AO returns to profit in FY23

Electrical retailer AO World has achieved statutory profit before tax of £7.6m for the year ended 31 March, compared with the £10.5m loss recorded the previous year. 

The group also reached an adjusted EBITDA of £45m, achieving an adjusted EBITDA margin of 4%. 

This comes as the group exited some business lines during the financial year, delivering operational efficiencies and overhead reductions ahead of original plans.

As the company ceased trading in Germany and completed its closure “with minimal cash impact”, AO also simplified its UK operations to focus more on profitable lines of business. 

As a result, the group’s overall liquidity reached £89m by the end of March compared with £50m in the same period last year. 

In addition, AO renewed its £80m revolving credit facility, which is now due to expire in April 2026. 

Looking ahead to FY24, the group said it is “confident” in its ability to deliver on its 5% EBITDA ambition in the short term and return to top line growth in the medium term. 

John Roberts, founder and chief executive of AO, said: “We are delighted with the demonstrable progress that we’ve made with the strategic realignment of AO towards profitability and cash generation. 

“Looking ahead, we intend to continue with this focus whilst also retaining the flexibility to drive growth through disciplined investment at the right pace and at the right time. Over five million new customers experienced the AO Way over the last three years, during which time we’ve maintained our “excellent” Trustpilot rating from more than 400,000 Trustpilot reviews, making AO the most trusted electrical retailer in the UK.”

He added: “I’d also like to thank all AOers for their support and commitment over the last 12 months. I’m always very proud of the way in which they rise to the challenges and maintain our fantastic culture, which is ultimately how we deliver for customers.”