TIDMOCDO
RNS Number : 7682Z
Ocado Group PLC
16 January 2024
OCADO GROUP PLC
16 January 2024
Ocado Retail Q 4 Trading Statement
FY23 guidance delivered; momentum building in FY24
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 we eks to 26th
November 2023
H ighlights
Q4 2023 (13 weeks to 26th November 2023)
-- Q4 Retail revenue of GBP609.4m grew 10.9% vs the same quarter
last year, a fourth consecutive period of quarter-on-quarter growth
and a significant increase vs the +7.2% reported in Q3.
-- Volumes (total items) grew consistently over the period, up 4.8% year-on-year.
-- Average orders per week (Ocado.com) of 407,000 grew 6.3% year-on-year.
-- Active customers reached 998,000 at the end of Q4, up 5.9% year-on-year.
-- Average basket value (Ocado.com) was up 3.8% while basket
size (number of items) remained broadly stable quarter-on-quarter
at 44 items per order.
-- ASP increased 5.4% year-on-year, again lower than market
inflation, reflecting Ocado's continued focus on improving pricing
relative to the market.
Key financial drivers
13 weeks 13 weeks Year on
Q 4 2023 Q 4 202 2 year change
(7) (%)(8)
Retail revenue (GBP million)
(1) GBP609.4m GBP549.3m 10.9%
---------- ----------- -------------
Volumes - total items (million)
(2) 232.2 221.5 4.8%
---------- ----------- -------------
Average orders per week (000s)
(3) 407 383 6.3%
---------- ----------- -------------
Active customers (000s) (4) 998 942 5.9%
---------- ----------- -------------
Average basket value (GBP)
(5) 120.62 116.20 3.8%
---------- ----------- -------------
Average selling price (GBP)
(6) 2.75 2.61 5.4%
---------- ----------- -------------
Average basket size (items) 43.8 44.5 (1.6)%
---------- ----------- -------------
FY 2023 (52 weeks to 26th November 2023)
-- Full year Retail revenue of GBP2,357.5m grew 7.0% vs last year.
-- Ocado.com volumes (total items) across the whole year are
down 0.9% given the drag in the first half due to the unwinding
from the pandemic and the cost of living crisis
-- Average orders per week (Ocado.com) of 393,000 grew 4.0%
year-on-year reflecting the increase in active customers.
-- Average basket value (Ocado.com) was up 2.7% while basket
size (number of items) reduced by 4.5% YoY to 44 items per order,
driven by the unwinding of pandemic shopping behaviours and the
cost of living crisis.
-- ASP increased 7.9% year-on-year, considerably lower than
market inflation, reflecting Ocado's continued focus on improving
pricing relative to the market.
-- Our trading performance, and our focus on costs, has
translated through to our bottom line, returning to positive EBITDA
for the full year.
Progress implementing our Perfect Execution programme
-- Focus on Perfect Execution has made the customer proposition stronger.
-- The percentage of Perfect Orders (on time and in full) has
increased +6pts across the year, with 99% of items delivered as
promised and a 24% improvement in products not fulfilled.
-- Consumers are being offered better choice, with the number of
M&S products on site increasing to around 90% of the
addressable range and even more Ocado Own Brand, new and unique
products being introduced.
-- Consumers are benefiting from lower prices through price
matching baskets to Tesco with the Ocado Price Promise since March
with the prices of 1000s of products reduced. Satisfaction scores
on value have improved materially.
Christmas Trading
-- Ocado delivered another record Christmas and hit its highest
ever level of sales over the peak Christmas trading period.
-- Demand was high and we sold over 90% of peak Christmas slots
released (22nd-24th) by mid-October. Between December 20th and
24th, sales overall increased 7% and eaches were up 3% including a
record day for "eaches" (number of items) delivered on the 23rd
December.
Hannah Gibson, Ocado Retail's Chief Executive Officer, said:
"We made significant progress in 2023. We have focused first and
foremost on being a great shopkeeper, improving our unbeatable
range, great value and unrivalled experience - all underpinned by
improved cost efficiencies. Our Perfect Execution programme set a
high bar for our performance, and we are pleased to have finished
the year with strong momentum. Thank you to everyone at Ocado
Retail, M&S and Ocado Group who've worked so hard to deliver
the first year of our strategy and these encouraging results.
We are starting the new year with over one million active
customers. Over the next 12 - 18 months, we will be embedding the
foundations we have laid this year and raising the bar again for
online grocery shopping. We have a really strong platform to build
on in 2024."
FY24 Guidance
Revenue:
We have confidence that the business will continue its
encouraging momentum over the coming year, growing sales volumes
ahead of the market. We expect the positive trends in customer
acquisition to lead to sustained volume growth in FY24. Revenue
growth is likely to be impacted by lower growth in average selling
price however, as we invest in value and as food price inflation
continues to subside. Overall revenue growth in FY24 is expected to
be in the mid-high single digits.
EBITDA:
This year we expect to make further progress on increasing
efficiencies and demonstrating operational leverage while
continuing on our journey towards a high mid-single digit EBITDA
margin in the midterm.
Alongside this release, a short video is available on the Ocado
Group website here in which CEO, Hannah Gibson, discusses recent
performance, strategy, and the outlook for Ocado Retail .
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 Zoom by Ocado
2. Volumes - total items refers to results of Ocado.com
3. Average orders per week refers to results of Ocado.com
4. Active customers are classified as active if they have
shopped at Ocado.com within the previous 12 weeks . 998,000 active
customers at the end of Q4 is based on the week 53 exit number
5. Average basket value refers to results of Ocado.com
6. Average selling price refers to Ocado.com and is defined a s
product sales divided by total eaches
7. As FY23 is a 53 week year, Q4 2023 therefore has 14 weeks in
the period, however to provide a like-for-like comparative the Q4
2023 trading update is based on the 13 weeks ending 26th November
(with the exception of active customers which is based on the 53rd
week year exit number). The 14 week Q4 2023 key financial drivers
are as follows: Retail Revenue GBP660.7m; volumes - total items
251m; average orders per week 409,000; average basket value
GBP121.00; average selling price GBP2.76; average basket size
43.9
8. Growth percentage calculated on a rounded basis
9. 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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