Weak pound 'to push up price of electrical goods'

Washing machines and fridges will start to become more expensive next year thanks to the fall in the pound, online electrical retailer AO World has warned.

It said that it was facing "pricing pressure" because of the collapse in sterling since the Brexit vote  in June - as well as economic uncertainty.

AO is one of a number of companies counting the cost of the UK currency's slump - though some are also setting out how it benefits them.

John Roberts, AO's chief executive, said this week's Black Friday sales looked set to be "bigger than ever" ahead of prices going up at the start of next year.

AO reported a 23% rise in revenues to £325m for the six months to the end of September, with growth in the UK and Europe.

Pre-tax profit swung into the black at £2.3m, compared to an £8m loss last year.

Mr Roberts said prices for electrical appliances would rise after the 14% fall in the value of the pound against the US dollar since the EU referendum.

"We do know there are going to be price increases," he said.

"In a category like electricals, where the margins are as tight as they are, there is no way the significant changes in currency we have seen are not going to flow into the market."

Separately, bar and restaurant owner Mitchells and Butlers warned that weaker sterling would squeeze its profits.

The group, whose brands include All Bar One and O'Neills, said this was because it buys food and drink in foreign currency.

Pre-tax profits for the year to 24 September fell 25% to £94m as sales declined - though there have been signs of a turnaround in recent weeks.

Elsewhere, global catering giant Compass saw a boost from the fall in sterling - which makes income in foreign currencies more valuable in pound terms.

Pre-tax profits for the year to the end of September were up 14% to £1.3bn, with nearly half the rise attributed to the pound's decline.

Meanwhile, banknote printer De La Rue, which makes 80% of its revenues outside the UK, said it "would benefit from a sustained weakness of sterling".

It made the comments as it reported a 31% fall in pre-tax profits to £17.2m for the six months to 24 September, with the fall attributed to one-off costs.