LONDON (Reuters) - The chief executive of AO World (AO.L), the British online retailer of domestic appliances that floated last year, still sees strong support from investors for his long-term strategy even after its shares crashed following a profit warning.
Chief Executive John Roberts said he had spoken to shareholders after the firm he set up 15 years ago cut its full-year earnings forecast last month, prompting the shares to plunge by more than 40 percent.
“They are all very supportive of us,” he told the Retail Week Live conference. “Investors in our business think on five to 10 year horizons.”
AO, which sells everything from washing machines and fridges to ovens and vacuum cleaners, said that some of last year’s revenue growth was due to the extra publicity around its flotation, making it harder to live up to its original forecast.
Roberts said his business philosophy was based on treating all customers as if they were his grandmother and taking decisions based on whether they would make his mother proud.
“Mum’s normally a pretty good guide,” he said. “Great service is the most profitable service long-term ... Do the right thing. Don’t let the P and L (profit and loss) be your guide.”
Roberts said he did not regret floating the company as it had helped fund a move into Germany as part of a wider European expansion plan.
He said he did not rule out eventually opening AO stores, although that was not his current plan.
Reporting by Emma Thomasson; Editing by Mark Potter