Online appliances retailer AO World has raised £50 million in capital in an effort to push European expansion, despite making losses.
Amid a trading update in which AO announced it would not make a profit in its financial year, the retailer has sold nine per cent of its shares to raise capital.
Share prices have plummeted to less than half their 2014 float value to 113p per share, as well as falling a further 22 per cent from last year.
Ahead of the end of the financial year, which finishes today, AO said its adjusted losses before interest, tax, depreciation and amortisation would be between zero and £2.4 million – down significantly from November’s forecast of figures between a £4.7 million profit and a £2.4 million loss.
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It added that revenues for the year would be around £700 million, a rise of nearly a fifth on the year prior.
The retailer has plans to expand across Europe, investing heavily in Germany and The Netherlands.
AO’s new chief executive Steve Caunce said the share capital was to “will support our continued growth and increasing scale”.
Caunce took over from the company’s founder John Roberts as chief executive last month.
Caunce and Roberts bought £2 million worth of shares each, and together owned 38 per cent of AO’s shares at the start of 2017.