Ocado has reported another significant rise in sales and profits as its retail joint venture with M&S continued to benefit from the pandemic-related shift to buying groceries online.
During its first half to May 30, Ocado’s overall group revenue rose 21.4% to £1.32bn, with EBITDA up 41.2% to £61.0m and pre-tax losses almost halved to £23.6m.
This was driven by the main Retail division where EBITDA climbed 58.4% to £104.1m on revenue up 19.8% to £1.22bn. At the end of the period, the delivery operation was serving 777,000 active customers, a 22% increase year-on-year, whilst average basket size was flat at £138.
Despite the easing of Covid-19 restrictions resulting in more shoppers returning to supermarket stores, Ocado said it was still seeing strong new customer and order growth.
The group is currently focused on ramping up its capacity in the UK to meet demand, with several new Customer Fulfilment Centres (CFC) due to go live in the second half of this year and in 2022.
Tim Steiner, the Ocado chief executive, said the company was tapping into demand “from new pools of customers now socialised to online grocery shopping”.
He added: “As we head towards a post Covid-19 future, it is increasingly clear that the landscape for grocery worldwide has changed, for good.”
Ocado also announced today that it had struck a deal with Auchan Retail to supply its state-of-the-art technology to the French group’s online business in Spain.
The 310-strong Alcampo chain in Spain will use the Ocado Smart Platform (OSP) to help expand its online capacity across the country. The pair will build a CFC to serve the Madrid region from 2024, with additional CFCs to follow. Alcampo will also leverage Ocado’s In-Store Fulfilment (ISF) software across its hypermarkets to enable more efficient picking from stores. The agreement will cover the retailer’s food and non-food business.
To date, Ocado’s has signed partnership deals with supermarket groups including Kroger in the US, Casino in France, and Aeon in Japan.
Steiner said: “The appetite for our unique end-to-end platform remains strong as retailers look to take advantage of the channel shift which is now redrawing the landscape of the global grocery market.
“Our partnership with Alcampo will bring the very best online grocery experience to customers in another major retail market, with proven and sustainable economics. We look forward to helping Alcampo change the way customers shop in Spain, for good.”
Ocado and Auchan Retail added that they would look at extending the partnership into other geographies.
