Ocado makes first ever annual profit
Online grocery retailer Ocado has reported its first full year profit since it was founded 15 years ago.
In the year to 30 November 2014, the retailer made a statutory pre-tax profit of £7.2 million compared to a loss of £12.5 million in the previous year.
Revenue climbed by 19.8% to £948.9 million while gross sales rose by 15.3% to £972.4 million.
The number of active customers increased to 453,000 from 385,000 in the previous year despite lower growth in overall marketing spend. However, average basket fell in the period to £112.25 from £113.53 previously.
Ocado chief executive Tim Steiner said: “Channel shift towards online grocery shopping continued during the period. While the broader grocery market was characterised by intense competition with minimal growth in the segment, declining supermarket store sales, competitive price activity and cautious consumer spending, we continued to grow ahead of the online grocery market and significantly ahead of the market overall.
“At the same time, we invested for further growth in UK grocery, non-food and platform opportunities given the attraction of our model in a growing online grocery market.”
The company said its tie-up with Morrisons, where its delivers online grocery orders on the supermarket’s behalf, was “ramping up smoothly” and paved the way for future agreements to commercialise the value of Ocado’s intellectual property.
Ocado is set to open a further two customer fulfilment centres in Andover and Erith which will add “significant” capacity.
Steiner said: “Overall, we are well equipped to continue to lead the online grocery revolution, in the UK and overseas, as increasing numbers of customers shift away from traditional forms of retailing. We are confident that we have significant opportunities for growth in sales and shareholder value.”
