Pureplay electronics retailers AO.com has reported “strong year-on-year revenue growth” in the UK and Germany ahead of its annual general meeting today.
AO said the “strong trading momentum” it flagged in July had continued and resulted in 58.9% growth in UK sales to £401.3m and a 91.5% surge in German sales to €74.3m.
In terms of the outlook for the remainder of the year, AO said its belief that “customers have found a better way to shop the electricals category” had been upheld due to the continued demand for its products and services during the pandemic and as a result it would be ramping up its capacity and capabilities through greater investment.
The retailer added a note of caution about the wider macroeconomic outlook with the pandemic ongoing and Brexit to come.
It said: “We remain cognisant of the significant level of economic and customer uncertainty driven by both Covid-19 and the prospect of Brexit in December and the impact this may have on demand for electricals in the medium term.”
Chief executive John Roberts said: ”Despite stores reopening, we are experiencing sustained momentum as customers continue to choose AO. This reaffirms our belief that this is a structural shift in demand where customers have found a better way to shop the category with AO.
”Consequently, we continue to invest in capacity and capability so that we maintain the high levels of service that our customers have come to expect now and in the future. The outlook remains uncertain but AO is well placed for the opportunities and challenges that are to come.”
Earlier in August, AO announced it would expand its distribution network with a new warehouse in Crewe.
The new centre would create 250 jobs at the retailer and add 225,000 sq feet of warehouse space, alongside the 115,000 sq foot warehouse in Stafford due to open this month.
In July, following its buoyant trading update, Roberts expressed an interest in expanding into new markets, after securing the future of its German arm.
Roberts said: “We will [look to new markets] now our German business is fixed. What we’re looking to do is build central areas of expertise, which we can repeat across categories and territories.
“Getting our German business into profitability is very much first base to give us the platform to grow in Germany and grow out from there too. That will be our focus for next year.”
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