- 13 September 2016
- Transport / Logistics Services
Online grocer Ocado has reported that it saw its quarterly revenues rise by 13.6% to £286.4 million while group sales, which include Morrisons.com, rose by 15.4% to £314 million.
The online retailer’s CFO Duncan Tatton-Brown also said that that Ocado achieved these record figures despite the fact that Amazon had launched its AmazonFresh grocery delivery service during this quarter.
Even so some investors seemed jittery with the competitive nature of the online delivery grocery market. Despite the good growth figures, Ocado saw its shares fall by 10% this morning.
Ocado has struck a deal to work with Morrisons for deliveries nationwide. The downside however is that Morrisons has also agreed to work with AmazonFresh, and on Sunday it announced that it is to install hundreds of Amazon Lockers at its supermarkets in the coming year. This points to the direction it is leaning and this doesn’t favour Ocado.
Commenting on the Ocado results, Martin Lane, a representative at www.money.co.uk , said: “While Ocado posted really positive results this morning, shares slumped because their Chief Exec admitted they’re under real pressure due to the continued battle of the supermarkets. It’s fairly unusual for a CEO to talk so candidly about the difficulties it’s facing so investors acted tentatively.
“With Aldi and Lidl causing mayhem for the whole sector by driving down prices, Ocado now faces huge competition from Amazon too. This is only going to intensify the price war between the online supermarket retailers, which is a good thing for bargain hunters and shoppers on a budget.
“Ocado’s results are a strong sign that its strategy to be the busy shopper’s best friend has most definitely paid off. Let’s just hope they don’t have to sacrifice some of the great development work they’ve ploughed into their website to make a profit.”