Ocado reports steady improvement

Ocado has reported growth in revenues as well as profit in its newest half year results.

The online grocer said that it generated a revenue of £584.2 million for the six months to 15 May, a 15.1% increase on the first half of 2015. Profits before tax were £8.5 million – up from £7.2 million.

Ocado said that 94.9% of its deliveries were on time, and also achieved an order accuracy of 99.1%. The company said that these results are “market leading service levels” though they were down on its first half of 2015 performance that was 95.6% on time, and 99.3% order accuracy. It also noted that more than 55% of its orders were now checked out using a mobile device.

Commenting on the results, Tim Steiner, Chief Executive Officer of Ocado said, “I am encouraged by the steady progress in our business, with volumes through our operations, including the throughput for Morrisons, growing by 30%. The market remains competitive with ongoing price deflation but our increasing scale and operational efficiencies meant that we still grew profits, albeit at a slower rate.

“We have been gaining share in the online grocery market and expect this to continue. The last few years have shown beyond doubt that British shoppers are choosing the benefits of grocery shopping online and we believe that the momentum of channel shift away from bricks and mortar stores will continue. The more opportunities customers have to try grocery shopping online, the more they will be attracted to Ocado’s superior customer offer.

“Testing of our new proprietary fulfilment and software solutions in our third facility in Andover is progressing well and we expect to move out of our test phase in the autumn post the quieter summer period. This and other innovations in technology that benefit our customers not only strengthen the Ocado retail brand but also make the Ocado Smart Platform an even more attractive solution for retailers outside the UK looking to build their own online grocery offer. I remain confident about signing up partners to this platform.

“Sales growth continues at pace and the productivity of our operations is improving. We have the technology, the brand and the financial resources to build on our leading position and look forward to the future with confidence.”