StockMarketWire.com - Electrical-appliance retailer AO World booked a narrower first-half loss after it notched higher sales in the UK, offset by a weaker performance abroad.

The company also said it would close its Netherlands operations to focus more on transforming its German business.

The decision to close operations in the Netherlands was expected to cost about £3m and become effective by the end of the current financial year.

For the year six months ended 30 September, pre-tax losses narrowed to £5.9m from £10.9m on-year, while revenue increased 16.3% to £470.1m.

Total UK revenue was up 20.3% to £402.7m, and Europe revenue decreased by 3.4% on a constant currency basis to €75.7m.

Gross margin for the group fell 1.3% to 16.3%, with total gross profit increasing by 7.6% to £76.6m.

Looking ahead, the company said it was fully committed to building German operations that would be a profitable business at around €250m run rate of revenue.

However, it didn't completely rule out the prospect of having to shutter its German operations, should efforts to boost performance fail.

'If we are wrong in our conviction it will be clear to us by at the very latest summer 2020 and in a worst case scenario we believe the cost of closure is around £20m,' AO World said. At 8:10am: [LON:AO.] AO World share price was +3.6p at 60.7p

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