(Alliance News) - AO World PLC on Thursday lifted its yearly outlook, with its move to focus on "profit and cash generation" paying off.
Shares traded 7.4% higher at 96.50 pence each in London, among the best FTSE 250 performers. The stock has jumped more than 50% over the past 12 months.
The electricals retailer expects adjusted pretax profit to be "at least" at the top end of a GBP28 million to GBP33 million range for the year ending March 31. It raised its outlook to that guidance range in November.
AO World expects revenue for the year to be around GBP1.04 billion, which would represent an 8.7% decline from GBP1.14 billion.
"Our core business continues to trade positively through Q4, and AO.com has returned to revenue growth during the quarter as expected," AO said.
The company reports annual results on June 26.
Chief Executive Officer John Roberts said: "I'm pleased with the clear progress that we're making after pivoting our focus to profit and cash generation during the 2023 financial year. As we expected at our half year results, we returned to revenue growth in our core business during Q4 and, as a result, we're entering the new financial year with good momentum. With net funds on our balance sheet and a clear plan, we remain confident in our ability to deliver on our ambition for 10-20% revenue growth in the year ahead and medium-term profit guidance of 5% adjusted [pretax profit] margin."
Profit cautions, tumbling consumer confidence, inflationary pressures, a Germany exit and credit cover worries at suppliers meant post-pandemic life for the company got off to a difficult start.
AO turned to self-help measures. In a set of annual results issued back in August 2022, it planned a "period of realignment for the business", focusing on cash a profit generation.
Since then, it has issued a number of guidance lifts, and market confidence in the stock is returning.
It made a return to the FTSE 250 index in December, after being dumped out two years prior.
By Eric Cunha, Alliance News news editor
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Ao World (AO.)