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Shares in Ocado Group PLC shot up on Thursday, as sales beat expectations, despite another loss-making year. Ocado rose 5.2% to 516.20 pence in London on Thursday morning. The wider FTSE 100 index was up just 0.3%. The Hatfield, England-based grocer and warehouse technology firm reported a pretax loss of £403.2 million in the 53 weeks ended December 3. This narrowed from £500.8 million a year ago, and was slightly better than the £410 million loss predicted by the company-compiled market consensus. The comparative period was for the 52 weeks to November 27, 2022. Adjusted earnings before interest, tax, depreciation and amortisation totalled £54.2 million, swinging from an adjusted loss of £74.1 million before. On an adjusted basis, Technology Solutions returned a profit of £15.4 million, Ocado Logistics a profit of £30.1 million and Ocado Retail, jointly-owned with M&S, a profit of £10.4 million. Revenue climbed 12% to £2.83 billion from £2.52 billion, ahead of a company-compiled consensus of £2.76 billion. Within that, Ocado Retail revenue rose 9.5% to £2.41 billion from £2.20 billion. Ocado said the total active customer base in the retail business increased by 5.9% and the growth in the mature customer base - meaning those customers who have shopped 5 or more times on Ocado.com - was stronger, up 9% on the year, the highest level it has ever been. Ocado Retail has over 1 million customers actively shopping on Ocado.com, the company reported. Ocado said it was confident that the business will continue its encouraging momentum over the coming year, growing sales volumes ahead of the market. But it cautioned revenue growth is likely to be held back by lower growth in average selling prices, reflecting price cuts, as food price inflation continues to subside. Overall revenue growth in financial 2024 is expected to be in a mid-to-high single-digit percentage, Ocado said. Ocado said it has installed capacity at its retail partners for gross annual grocery sales of over £8 billion. Technology Solutions revenue jumped 44% to £429.0 million from £291.4 million. Ocado forecast 15% to 20% growth in the division in 2024. Underlying cash outflow of £473 million in financial 2023 compared to an £829 million outflow in financial 2022, and the £356m improvement was better than guidance of plus £200 million. In financial 2024, Ocado predicted a further reduction in cash outflow of £100 million. Copyright 2024 Alliance News Ltd. All Rights Reserved.
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