Ocado reports continued strong growth as lockdown restrictions ease

Ocado has posted interim results for the 26 weeks ended 30 May 2021, showing 21.4% sales growth.

Financial highlights:
• Group revenue growth of 21.4% to £1.3bn; growth across all business segments Retail growing to £1.2bn, up 19.8%; strong new customer and order growth as Covid-19 restrictions ease International Solutions revenues of £26.6m.
• Ocado Smart Platform (OSP) fees building as expected Group EBITDA more than tripled to £61m despite increased investment in OSP roll out and platform Industry-leading performance in Ocado Retail.
• EBITDA margin of 8.5% Loss before tax reduced by £17m to £23.6m compared with £40.6m in the prior year
• Cash balance of £1.7bn, supporting significant UK and International growth plans.

Business highlights:
• Continued strong Retail performance, even as Covid-19 restrictions ease.
• Bristol Customer Fulfilment Centre (CFC) scaled to over 50% of mature capacity four months after go-live, ramping faster than any prior site.
• 7 of 10 partners now live on OSP, using a full range of platform solutions; ISF through to standard CFC.
• Go-live of first 2 CFCs for US partner, Kroger; delivered on time and performing well.
• 4 CFCs now operating internationally, across 3 markets.

CEO Tim Steiner (pictured) said, 'As we head towards a post Covid-19 future, it is increasingly clear that the landscape for grocery worldwide has changed, for good. Over the last eighteen months, we have shown that the Ocado model works even in the most challenging and fluid of environments.

'That ours is a proven model in online grocery has been again demonstrated by the strong performance of Ocado Retail, the historic core of the Ocado business, which has led the market in customer experience, increasing sales by 20% in the period, thanks to a significant increase in customer numbers, while continuing to show sustainable and industry-leading profitable growth.

'Speed to market and resilience are critical attributes of the very flexible Ocado Smart Platform ('OSP'), the hardware and software solution which enables our partners in the UK and around the world to bring the benefits of the Ocado model to their customers.'

Steiner continued, 'Our first mini Customer Fulfilment Centre (CFC), in Bristol, UK, is now ramping faster than any facility before it. The speed at which the OSP has developed means that our partners can bring the best customer experience and the best economics to their customers faster.

'The model is resilient - as the imminent relaunch of Andover as a state of the art robotic CFC shows - and well suited to an environment where customers will ask grocers to offer solutions to a full range of customer missions from same day delivery to next day; big basket to immediacy; delivery to home or kerbside pick-up.

'We continue to build strong partnerships with our clients and win new clients, based on our twenty year experience as a technology company and a food retailer, and these partnerships are the bedrock of our business.'

Steiner ended, 'Our partners will continue to benefit from the full suite of options available from OSP as well as high levels of innova?on and problem-solving which is at the heart of Ocado's DNA. Together, we are reshaping the grocery industry to the benefit of consumers around the world'.