4 July 2022
AO WORLD PLC
Response to Recent Press Reports
AO World plc ("AO" or the "Company"), a leading online electricals retailer, notes today's share price movement following press reports over the weekend. The Company's current financial performance and financial position remain in line with the Board's expectations and the guidance set out in its trading update on 29 April 2022.
AO confirms that it is aware that one of the third-party credit insurers who provide credit insurance to some of its suppliers rebased their cover in May 2022 with respect to AO, reflecting post-Covid sales levels. This was a reduction from the heightened levels that had been in place and required through the period of the pandemic. To date this rebased cover has had no effect on AO's liquidity position which remains in-line with the Board's expectations for FY23.
On 9 June 2022, AO announced the decision to close its German operations. Progress to date has been encouraging with total cash costs of closure now expected to be towards the lower end of the Company's original estimates of nil to £15m. The higher end of that range assumes the Company would be unable to exit certain asset leases, of which c. £10m of cash outflow would be due in future years.
AO continues to have full access to its £80m revolving credit facility, the term of which runs until April 2024. In addition, the Company continues to consider and implement a number of ongoing initiatives and further actions to strengthen its balance sheet while optimising its focus on profit and cash generation against the uncertain macroeconomic conditions in the UK and the continuing global supply chain challenges.
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| AO World plc | Tel: +44 (0)7525 147 877 | |||||
| John Roberts, Founder and Chief Executive | IR@AO.com | |||||
| Mark Higgins, Group CFO | ||||||
| Cynthia Alers, Investor Relations Director | ||||||
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| Powerscourt | Tel: +44 (0)20 7250 1446 | |||||
| Rob Greening Nick Hayns Elizabeth Kittle | ||||||
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| About AO AO World plc, headquartered in Bolton and a constituent of the FTSE Small Cap index, is a leading online electricals retailer in the UK. Our strategy is to create value by offering our customers brilliant customer service and making AO the destination for everything they need, in the simplest and easiest way, when buying electricals, including major and small domestic appliances and a growing range of mobile phones, AV, consumer electricals and laptops.
We deliver for our customers via our in-house logistics business and carefully selected third parties. We also provide ancillary services such as the installation of new products and recycling of old products as well as offering product protection plans and customer finance. AO Business serves the B2B market in the UK, providing electricals and installation services at scale. AO also has a majority equity stake in AO Recycling, a WEEE processing facility, allowing AO to ensure its customers' electronic waste is dealt with responsibly. | ||||||
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| Cautionary statement This announcement contains certain forward-looking statements (including beliefs or opinions) with respect to the operations, performance and financial condition of the Company and its subsidiary undertakings. These statements are based on current expectations or beliefs, as well as assumptions about future events. By their nature, future events and circumstances can cause results and developments to differ materially from those anticipated. Except as is required by applicable laws, no undertaking is given to update the forward-looking statements contained in this document, whether as a result of new information, future events or otherwise. | ||||||
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ENDS | ||||||
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