TIDMOCDO
RNS Number : 8366M
Ocado Group PLC
19 September 2023
OCADO GROUP PLC
19 September 2023
Ocado Retail Q 3 Trading Statement
Strategic momentum underpins confidence in FY guidance
Ocado Retail Ltd ("Ocado"), a joint venture between Ocado Group
plc ("Ocado Group") and Marks & Spencer Group plc ("M&S"),
today announces its trading statement for the 13 weeks to 27th
August 2023
Highlights
-- Q3 Retail revenue of GBP569.6m grew 7.2% vs the same quarter
last year, an accelerating trend vs the +5% reported in H1, with a
return to positive volume growth (total items) in the last month of
the quarter.
-- The Perfect Execution Programme, launched in January, has
further strengthened our customer proposition. The Big Price Drop
campaign was launched in August to coincide with the return to
school, further strengthening Ocado's price credentials, while
"perfect deliveries" (on time and in full) remained at high
levels.
-- Average orders per week (Ocado.com) of 381,000 grew 1.9%
year-on-year, lapping a strong customer acquisition push this time
last year.
-- Active customers reached 961,000 at the end of Q3, up 1.5%
year-on-year. The number of mature customers (defined as those who
have made a fifth shop at Ocado.com) grew 6.6%.
-- Average basket value (Ocado.com) was up 4.2% while basket
size (number of items) remained broadly stable quarter-on-quarter
at 44 items per order.
-- ASP increased 8.4% year-on-year, again considerably lower
than market inflation, reflecting Ocado's continued focus on
improving pricing relative to the market.
-- Positive momentum headed into Q4; FY23 guidance unchanged.
Key financial drivers
13 weeks 13 weeks Year on
Q 3 2023 Q 3 2022 year change
(%)(6)
Retail revenue (GBP million)
(1) GBP569.6m GBP531.5m 7.2%
---------- ---------- -------------
Average orders per week (000s)
(2) 381 374 1.9%
---------- ---------- -------------
Active customers (000s) (3) 961 946 1.5%
---------- ---------- -------------
Average basket value (GBP)
(4) 120.72 115.85 4.2%
---------- ---------- -------------
Average selling price (GBP)
(5) 2.76 2.55 8.4%
---------- ---------- -------------
Average basket size 44 45 (3.9)%
---------- ---------- -------------
Hannah Gibson, Ocado Retail's Chief Executive Officer, said:
"It has now been a year since I joined Ocado Retail and in
January we set out our Perfect Execution strategy, making sure
every element of our customer proposition and our operating model
is at its best. We are delivering on this plan and have great
momentum in the business, with revenue growing faster in Q3 than in
H1 and a return to positive volume growth in the last month of the
quarter. The continued progress in Q3 underpins our confidence in
delivering our FY23 guidance of mid-single digit revenue growth and
full year profitability, and we have started the final quarter
positively.
Ocado Retail brings together Ocado Group's cutting edge
technology and the magic of M&S to deliver the very best
experience for our growing customer base. Today we are opening a
new robotic customer fulfilment centre in Luton, with new
innovations that will enable huge leaps forward in fulfilment
productivity and a better experience for our customers. Opening
Luton will enable us to double productivity versus our first
generation Hatfield site. Our robotic CFC in Purfleet is now
already regularly achieving UPH (units processed per labour hour)
of over 220 and we expect Luton to achieve 300+.
We continue to deepen our collaboration with M&S, including
hundreds of new M&S lines set to launch in the Autumn. Together
with our partners, we are intent on bringing even lower prices,
more choice, and greater convenience to our customers. We are
making good progress, but we want to go even further.
I would like to thank the great team at Ocado for their
relentless focus on the needs of our customers, as they navigated
the cost of living crisis. Together, we look forward to building on
the growing momentum of the business and continuing to raise the
bar in online grocery through the rest of this year and
beyond."
Guidance
There is no change to the guidance issued on 28 February with
the Ocado Group FY22 results and reconfirmed at the H1 results on
18 July. This guidance is summarised below.
Revenue : mid-single digit growth, with an improving trajectory
during the year, reflecting a return to volume growth as the
challenging comparison to larger volume basket shopping behaviours
that remained in early 2022 fades.
EBITDA : marginally positive EBITDA, with the shape of the year
expected to reflect trends in volume and revenue growth; while
EBITDA was a small negative in H1 (-GBP2.5m), we expect a positive
result in the second half, as a return to volume growth supports
improved capacity utilisation and reduced costs relative to
sales.
Ocado Group, on behalf of the joint-venture, will be hosting an
analyst conference call at 8.00am today. Please use participant
number: +44 (0) 33 0551 0200 and confirmation code: Ocado Analyst
Call. A replay facility will be available through an on demand link
for 90 days following the announcement.
Contacts
-- Stephen Daintith, Chief Financial Officer, Ocado Group plc,
on +44 1707 228 000
-- David Shriver, Chief Reputation Officer, Ocado Group plc, on
+44 1707 228 000
-- Fraser Ramzan, Head of Investor Relations, Marks and Spencer
Group plc, on +44 20 3884 7080
-- Martin Robinson at Teneo on +44 20 7353 4200
About Ocado Retail
Online supermarket Ocado.com was established in 2000 and is one
of Britain's leading online retailers, now a 50:50 joint venture
between Ocado Group plc and Marks & Spencer Group plc. Covering
geographies comprising over 82% of UK households, every shopping
bag is carefully packed in one of seven distribution centres using
market leading software and technology. Shopping is then delivered
directly to customers using a network of regional spokes in
brightly-coloured vans. With award-winning mobile apps, Ocado
Retail delivers a wide range of products, including big-name
brands, a range of quality M&S and Ocado own brand products and
a non-food selection. Thoughtful service features such as
colour-coded bags, digital receipts provided in date order,
reminder texts with your driver's name, along with convenient
hourly delivery slots complementing award-winning customer service
on email, phone and social media.
Notes
1. Retail revenue comprises revenues from Ocado.com and Ocado Zoom
2. Average orders per week refers to results of Ocado.com
3. Active customers are classified as active if they have
shopped at Ocado.com within the previous 12 weeks
4. Average basket value refers to results of Ocado.com
5. Average selling price refers to Ocado.com and is defined a s
product sales divided by total eaches
6. Growth percentage calculated on a non rounded basis
7. The figures used in this announcement are unaudited
A copy of this trading update is available on www.ocadogroup.com
and www.corporate.marksandspencer.com
Cautionary statement
Certain statements made in this announcement are forward-looking
statements. Such statements are based on current expectations and
assumptions and are subject to a number of risks and uncertainties
that could cause actual events or results to differ materially from
any expected future events or results expressed or implied in these
forward-looking statements. Persons receiving this announcement
should not place undue reliance on forward-looking statements.
Unless otherwise required by applicable law, regulation or
accounting standard, Ocado does not undertake to update or revise
any forward-looking statements, whether as a result of new
information, future developments or otherwise.
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END
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