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Ocado's Sales Growth Held Back By Fire At Distribution Centre

By Steve Wynne-Jones
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British online supermarket Ocado said on Tuesday its retail revenue growth slowed in the latest quarter, hit by last month's huge fire at its flagship robotic distribution centre in southern England.

The group, which last month announced a joint venture with Marks and Spencer, said its retail revenue increased 11.2% to £404 million in the 13 weeks to March 3, its fiscal first quarter, having risen 12% in the previous quarter.

Fire Impact

Prior to the blaze at Ocado's Andover site, the centre was providing about 10% of the firm's UK capacity. The company warned in February of a reduction in sales growth until it increases capacity elsewhere.

Ocado said the impact of the fire was 1.2% of sales in the quarter. It said average orders per week rose 11.3% to 314,000, though average order size edged 0.2% lower to £110.24.

The cause of the fire is still being investigated.

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"Our initial assessment of the reasons for the fire gives us confidence that, going forward, there are no significant implications for the risk profile of the assets or the viability of our model," Ocado said.

It plans to build a state-of-the-art replacement facility that reflects the innovations and improvements it has made since Andover opened in November 2016.

News by Reuters, edited by ESM. Click subscribe to sign up to ESM: European Supermarket Magazine.

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