Despite posting a pre-tax loss of £3.8 million ($5.8 million) for the six months ending 19 May, Ocado has asserted that it is 'well-placed' to benefit from growth in the online grocery market.
The online grocer pointed to growth in customer numbers, an increase in average basket values and its recent 25-year tie-up with supermarket chain Morrisons as evidence of its strong position.
Ocado's first half sales rose by 15.2% to hit £382.7 million and the firm said it expected to continue to grow broadly in line with the market.
Earnings before interest, tax, depreciation and amortization rose 29% to £19.2 million, as the retailer managed to win new customers and increase average spend, which rose by 1.6% to £114.90. Average order numbers per week also increased, rising by 13.4%
Ocado said the pre-tax loss was driven by advisory costs associated with the Morrisons deal, which is subject to shareholder approval, as well as pre-opening costs of new distribution centres.
The Hatfield-based online retailer posted one-time costs of £2.8 million to open its new warehouse in Warwickshire in February, along with professional fees in relation to the finalisation of its deal with Morrisons, Ocado CFO Duncan Tatton-Brown said. The firm also opened its first non-food distribution centre in Hertfordshire during the period, which it said would enable it to take advantage of the rising number of customers purchasing items other than food.
"We remain well placed to take advantage of the accelerating structural changes in the industry as more customers choose online delivery for their grocery shopping," Ocado chief executive Tim Steiner said. (2 July)
© 2013 - ESM: European Supermarket Magazine by Ellen Lunney
