APPLIANCES retailer AO World has reported a sharp drop in profits after the cost of its launch in Germany was offset by a 25 per cent jump in half-year sales.

The Bolton-based online business said pre-tax profit fell to £779,000 in the six months to the end of September from £2.1 million a year ago, after incurring £3.3m of costs from the October launch of its German business.

The firm, which sells washing machines and fridges, said total sales for the period were up by just over one quarter to £217.1m.