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Ocado revenue slips in fourth quarter

Ocado saw its retail revenue edge down 3.9% to £547. 8 million in its fourth quarter, although sales were up 31.6% on 2019. In the 13… View Article

FOOD & DRINK

Ocado revenue slips in fourth quarter

Ocado saw its retail revenue edge down 3.9% to £547. 8 million in its fourth quarter, although sales were up 31.6% on 2019.

In the 13 weeks to 28 November, customer orders per week rose by 9% on the prior year after sales were driven by a 22% increase in active customer numbers to 832,000.

However, growth in orders was impacted by labour shortages  early in the quarter and by a temporary reduction in capacity at the retailer’s Erith customer fulfilment centre. At the same time, the value of the average basket fell by 12% to £118 as customer behaviours adjusted following the lifting of Covid-19 lockdowns.

Tim Steiner, chairman of Ocado Retail, said: “We are very encouraged by the underlying trends which are driving growth in our business. Hundreds of thousands of UK consumers have tried online grocery over the last eighteen months and the vast majority are continuing to shop online and are not going back to physical stores.

“These customers increasingly appreciate the customer service provided by Ocado.com and Ocado Zoom and the range of customer missions that we satisfy from the big basket to the top-up shop. We can see this in the strong growth in customer transactions at Ocado Retail over the second half of the year.”

Ocado said it expects to return to strong, mid-teens revenue growth in 2022 at the top of the historic pre-Covid range of 10% to 15% as it ramps up capacity. This has included the addition of three new customer fulfilment centres in 2021 and a new site in  Bicester which is due to go live in in the second half of the new financial year.

Steiner added: “At a time of growing momentum in the channel shift from physical stores to online we are bringing significantly more capacity to market and are confident that we are on a strong, long-term growth trajectory.”

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