White goods online retailer AO World reported a “challenging” UK trading environment in its first quarter but said it is on track to achieve market expectations for the full year.
British sales volumes in major domestic appliances such as dishwashers and washing machines fell overall, but revenues in its core UK website rose by 6.2 per cent, the company said in a trading update today.
It was the first full quarter since the firm's chief executive, Steve Caunce, took up the role. He replaced AO World founder John Roberts, who remains on the board, in February.
Total UK revenues grew 2.5 per cent in the second quarter, with the slower overall performance reflecting AO's efforts to refocus its business on the central brand. It still operates multiple third-party websites behind the scenes, but has decided to shrink that business in favour of concentrating on sales directly from AO.com.
The firm is also growing at a healthy rate in Europe, despite announcing last month it had made a £27.6m operating loss from its expansion into the region. Revenues on the continent grew 57.6 per cent year-on-year when measured in euros from a relatively low base, while measured in sterling the improvement was 73.1 per cent.
The firm also noted this expansion was achieved with limited spending on expensive television advertising.
AO World chairman Geoff Cooper said: "AO World remains on track with its long-term strategic plan and the board expects results for the full year to fall within the range of market expectations. Customer satisfaction continues to be exceptional in all of our territories and the roll-out of further categories across the UK and Europe continues."
He added: “Our momentum is encouraging and we remain confident in the delivery of the plan we set out at our capital markets day in February."
Read more: AO World has raised £50m in a share placing