AO World (AO) investor relations material

Executive summary

• Achieved record like-for-like profit before tax of £45.2m, up 32% year-over-year, surpassing guidance.

• Group turnover reached £1.1bn, with B2C revenue up 12% year-over-year to £832m.

• Vertically integrated operations across retail, logistics, recycling, and insurance ensure value capture.

• Membership model and customer service rated 4.9/5 on Trustpilot, driving loyalty and repeat business.

• Strategic focus on expanding product categories and leveraging acquisitions like Music Magpie.

Financial highlights

• Group revenue increased 9% year-over-year to £1,138m; B2C retail revenue rose 12% to £832m.

• Profit before tax (like-for-like) was £45.2m, above guidance and up 32% year-over-year.

• Adjustments of £23m included non-cash impairments in mobile and acquisition costs.

• Available liquidity increased to £147m from £116m; revolving credit facility raised to £120m and extended to 2028.

• CapEx of £9m focused on delivery vehicles and logistics; £20m planned for FY26 for vehicle refresh.

Outlook and guidance

• FY26 profitability expected between £40m and £50m, with a medium-term target of at least 5% PBT margin.

• Labor cost increases and Music Magpie losses to impact short-term profits, offset by efficiency gains and B2C growth.

• Efficiencies and innovations to benefit H2 more than H1; profit distribution may differ from FY25.

• Decision on postpaid mobile business expected within weeks; closure possible if profitability cannot be achieved.

• Focus on membership leverage, mobile strategy, and operational efficiencies for future growth.