AO World (LON: AO.) shares jumped Friday after the company updated its profit guidance to the top end of the previously issued range.
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In February, AO World said it expected adjusted EBITDA for the financial year to come in between £37.5 million and £45 million.
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AO World shares gained more than 10% after today’s release, hitting a high of 77.9p.
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The company said it has continued to see positive traction from its initiatives to reduce costs and improve margins. In addition, the potential impacts from trading risks, continuing macroeconomic uncertainty, and the tough consumer environment that it previously anticipated “have not materialised to the extent envisaged.”
UK revenues for the full year to March 31, 2023, are anticipated to be £1.13 billion, in line with expectations, resulting in AO’s online UK MDA market share being 32.1%.
Furthermore, AO World’s £80 million revolving credit facility has been renewed with HSBC, NatWest, and Barclays, extending to April 2026.
“We are encouraged by the work undertaken to pivot the business during the financial year 2023. AO enters the new financial year with net funds on the balance sheet, a robust trajectory, and full confidence in our ability to deliver on our medium-term profit guidance of 5% adjusted EBITDA4,” said John Roberts, CEO and Founder of AO World. “We anticipate that our progress in improving both operational cost efficiencies and margin in FY23 will continue through the next 12 months and beyond.”
The company is set to publish its full-year results on July 5.
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