AO World FY earnings rise but IPO costs weigh

5th Jun 2014 08:13

AO World reported higher sales and earnings, but the white goods supplier racked up annual operating losses of £7.2m due to costs of its flotation earlier this year.AO World said total revenue in the year to March 31st increased 40% to £384.9m, driven by increased order volumes at slightly higher average order values to the previous year.Adjusted pre-tax earnings before interest, depreciation and amortisation (EBITDA) rose 10.9% to £11.2m.But it made an operating loss for the year of £7.2m against £8.4m last time after charging £15.4m of exceptional costs relating to the flotation to its income statement.Adjusted EBITDA margin fell by 0.8 percentage points to 2.9% largely as a result of higher marketing and advertising expenses as a result of re-branding its main website to ao.com and subsequent TV campaigns.The company, which listed on the London Stock Exchange in March, said the 2015 financial year had begun well with trading in line with its expectations in all respects.Chief Executive John Roberts said: "Our UK business continues to build strongly aided by a successful rebranding, introduction of same day delivery and entering the small domestic appliance and television markets. "We are making great strides in preparing for our launch into Germany as the first step to becoming a leading European online electrical retailer."Shares fell 6.5p or 2.5% to 254.75p at 08:46 in London.PW