Online electricals retailer AO World has been hammered by the cost of living crisis, but the future may be brighter after it shut loss-making divisions.
AO has reported that revenues fell 17% in the six months to 30 September, while its pre-tax loss swelled to £12m from £4m in “a tough environment”.
AO insists, though, that its sales are on track, while profits for this year are expected to hit the top of current guidance.
The company, which sells electrical items and kitchen equipment for home delivery, has conducting a ‘strategic pivot’ towards cash generation and profitability, having been hurt by supply chain problems and the economic slowdown.
It warns, though, that it expects more damage from the cost of living crisis affecting consumer spending, and ongoing supply chain issues.
AO’s founder and chief executive, John Roberts, explained: “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.”