Ocado reports double digit sales growth

Online supermarket Ocado has once again reported double digit growth in sales, with a 15.3% increase in sales in the twelve weeks to 21 February by comparison to the same period last year. The Group’s sales were £312.4 million while retail sales saw an increase of 13.8% to £286.7 million.

Average orders per week increased to 214,000 from 183,000, but the average order size fell from £111.41 from £114.72.

Commenting on the results, Tim Steiner, Ocado’s Chief Executive Officer, said: “We are pleased with the steady progress in our business, maintaining double digit sales growth in a retail environment that remains challenging, and post period end we shipped over 250,000 orders in a single week for the first time.

“We believe our focus on customer satisfaction and commitment to improving what we offer to consumers through innovation and our proprietary IP will support further growth.  Notwithstanding the tough nature of the marketplace, we expect to continue growing ahead of the online grocery market.”

Ocado’s Chief Financial Officer Duncan Tatton-Brown told reporters that Ocado expects to finalise a renegotiated supply agreement with Morrisons “relatively soon”.Ocado struck a deal to provide Morrisons with online delivery services back in 2013 – but the arrangement has been complicated by Morrisons’ recent tie-up with Amazon Prime.

Rumours have been rife about Ocado’s relationship with Amazon Pantry yet Amazon watchers were caught off guard with the announcement of Morrisons’ tie up with Amazon Prime. Where Ocado looked to be in for a bright future should they be bought by Amazon, it hasn’t turned out to be. Things could change quickly but for now the grocery store is focusing on rapid growth as it has been for many years – not something that grows profit margins, but something that does make it a juicy acquisition for an interested buyer.