Among the major news on UK stocks, AO World PLC (GB:AO) soared after the company released upbeat results for the fiscal year that ended on March 31, 2024. The company reported an adjusted pre-tax profit of £34.3 million, marking a huge year-over-year growth of 186%. This surpassed the company’s previously guided range of £28 million and £33 million. The profit growth was driven by the successful implementation of the company’s strategy of shifting its focus towards profitability and generating cash.
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Following the release of the results, AO World shares gained 2.3% as of writing. Year-to-date, the stock has experienced a gain of 25% in trading.
AO World is a retail group based in the UK, providing a wide range of electrical and household appliances.
Highlights from AO World’s FY24 Results
In FY24, AO World’s revenue slipped 9% to £1.04 billion compared to the previous fiscal year. The revenue dip was expected by the company, mainly due to the elimination of non-core channels and loss-making sales.
During the year, more than 600,000 new customers engaged with AO’s services. Meanwhile, repeat customers contributed 54% of its overall clientele. Additionally, the company achieved the milestone of 500,000 Trustpilot reviews, with an overall rating of 4.8 out of 5. Trustpilot is a Denmark-based leading online review platform that hosts reviews of businesses from around the world.
In terms of outlook, the company confirmed its double-digit revenue growth in FY25, coupled with an adjusted pre-tax profit ranging between £36m and £41m. Despite the ongoing macroeconomic challenges like inflation, shrinking consumer confidence, and higher interest rates, AO World remains confident about achieving its goals.
Is AO World a Good Investment?
In terms of share price appreciation, AO stock has received a Moderate Buy rating from analysts on TipRanks. The projected target for the AO World share price stands at 106.67p, indicating a potential downside of 8%.
