AO World pins its hopes on a winning World Cup run for England to boost flagging TV sales
AO World is pinning its hopes on the World Cup to boost TV sales.
England got off to a flying start this week with a 6-2 victory over Iran, fuelling hopes the Three Lions could enjoy a good run in the tournament.
And AO founder and chief executive John Roberts said progress by England into the later stages of the World Cup was likely to bolster demand for TVs.
Football fever: AO founder and chief executive John Roberts said progress by England into the later stages of the World Cup was likely to bolster demand for TVs
‘Any World Cup gives our business really positive momentum around sales for things like TVs,’ he said.
‘The further [England] go in the competition, normally the more TVs we sell.’ AO shares soared 16.8 per cent, or 8.8p, to 61.15p.
The start of the World Cup followed a difficult first six months of the year for AO, with the major domestic appliance market slumping 11 per cent compared with 2021.
Declines in the electricals market together with measures taken by AO to streamline its business saw revenue plunge 17 per cent to £546million in the six months to September.
The group’s losses also tripled to £12million in the period. In a further warning, AO said its business would continue to take a hit from the cost of living crisis and fall in consumer spending.
But the Bolton-based company outlined plans to focus on the UK market and scaling down the business.
It is in the process of winding down operations in Germany.
AO said sales for the year should be in line with forecasts while profit should exceed expectations.
The group also wants to strengthen its foothold across televisions, laptops, audio visual and small domestic appliances.
‘During the first six months of the year we’ve made good progress with our strategic realignment as we focus on profitability and cash generation, all of which is yielding the results we expected,’ Roberts said.
‘We’ve now closed the loss-making and cash consumptive parts of our operations, meaning the remaining UK business is cash generative, and are successfully closing our German business with a minimal cash impact to the wider group.
‘I’m pleased with this progress, particularly against the backdrop of an extraordinarily difficult macro-economic climate.’