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(Alliance News) - Online grocer Ocado on Friday said it has signed a deal for its delivery platform in a new country, Japan.
Ocado's Smart Platform will now be used in Japan by Aeon. The Japanese company has 21,000 food stores across 14 countries but will be opening a new online business, with help from Ocado.
The agreement will see the development of a national fulfilment network to serve the whole of the Japanese market, with expected sales capacity of around JPY600 billion by 2030, growing to approximately JPY1 trillion by 2035. The service is expected to go live in 2023.
Aeon will pay Ocado upfront fees upon signing and during the development phase, then ongoing fees linked to both sales achieved and installed capacity within each customer fulfilment centres and service criteria.
"I am delighted to welcome another extraordinary retailer, and the first from Asia, to the unique international club of grocers powering their ecommerce operations with Ocado. This partnership marks a major milestone for the food retail landscape in Japan," said Ocado Chief Executive Officer Tim Steiner.
Added Motoya Okada, CEO of Aeon said: "We see Ocado as a state-of-the-art, exciting and transformative partner aligned with our strategy of accelerating Aeon's digital shift to serve Japan's consumers."
The Japanese deal follows a string of successes for Ocado selling its platform to partners around the world, in addition to its joint venture with Marks & Spencer in the UK. These include Kroger in the US, Groupe Casino in France, and Coles Supermarkets in Australia.
Ocado shares were up 10% in early trade Friday.
Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: down 0.6% at 7,375.02
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Hang Seng: down 2.0% at 26,344.62
Nikkei 225: closed down 0.5% at 23,293.91
Wall Street closed for Thanksgiving holiday Thursday; reopens for half-day Friday.
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GBP: flat at USD1.2906 (USD1.2904)
EUR: flat at USD1.1009 (USD1.1002)
Gold: up at USD1,458.20 per ounce (USD1,455.02)
Oil (Brent): up at USD63.10 a barrel (USD62.72)
(changes since previous London equities close)
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ECONOMICS AND GENERAL
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Friday's Key Economic Events still to come
0930 GMT UK GfK consumer confidence survey
0930 GMT UK monetary & financial statistics
0930 CET EU EuroCOIN indicator of euro area economic activity
1000 CET Germany labour market statistics (including unemployment)
1100 CET EU flash estimate euro area inflation
1100 CET EU unemployment
1300 EST US financial markets close early for day after Thanksgiving.
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A row has erupted in the UK between the Conservative Party and Channel 4, with the Tories saying the broadcaster "conspired" with Jeremy Corbyn to block them from a TV leaders' debate. The party has made a formal complaint to Ofcom's election committee as an ice sculpture was used in Boris Johnson's place in the Channel 4 News debate on climate change. The UK prime minister was again accused of "running scared" when he did not join the other party leaders, with Michael Gove instead turning up and asking if he could stand in for Johnson, before being turned away because he is not a party leader.
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UK consumer confidence has "flatlined" in the face of Brexit and election uncertainty, four years since it was last in positive territory, according to a long-running survey. GfK's Consumer Confidence Index remained unchanged at minus 14 in November as consumers continued in "wait and see mode" ahead of the General Election. Confidence in the general economy over the coming year rose by three points in an indication that some consumers believe the election might clear the Brexit deadlock, GfK said, but it noted it remains in "deeply negative" territory at minus 34. Confidence in personal finances over the next 12 months is unchanged at positive one, two points lower than November last year. Ahead of Black Friday, the major purchase index, a measure of confidence in buying big ticket items, fell one point to zero, three points higher than a year ago.
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Hong Kong police on Friday ended their two-week siege of a university campus that became a battleground with pro-democracy protesters as activists vowed to hold fresh rallies and strikes in the coming days. Renewed calls to hit the streets came after Beijing and city leader Carrie Lam refused further political concessions despite a landslide victory for pro-democracy parties in local elections last weekend. The polls ushered in a rare period of calm following weeks of spiralling unrest, with no clashes or tear gas battles between protesters and police for more than a week. But the calm spell looks set to end as public anger grows once more over the lack of response to the election results by Beijing and Hong Kong's leaders.
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Japan's jobless rate remained steady in October, the Statistics Bureau of Japan reported. The seasonally-adjusted unemployment rate was 2.4%, the same as that recorded the month before.
Meanwhile, Japanese industrial production fell markedly in October, data from the Ministry of Economy, Trade & Industry showed. Production was down 4.2% month-on-month, and slumped 7.4% on a year ago. Shipments were down 4.3% on a monthly basis and 7.1% lower annually.
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BROKER RATING CHANGES
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GOLDMAN CUTS ST JAMES'S PLACE TO 'SELL' ('NEUTRAL') - TARGET 900 (980) PENCE
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BERNSTEIN CUTS ROYAL MAIL TO 'MARKET-PERFORM' ('OUTPERFORM') - TARGET 225(250) PENCE
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MORGAN STANLEY CUTS BIG YELLOW TO 'UNDERWEIGHT' ('EQUAL-WEIGHT') - TARGET 1000(1075) PENCE
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COMPANIES - FTSE 100
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AstraZeneca said the US Food & Drug Administration has granted the company's Imfinzi small cell lung cancer treatment a priority review. The FDA has accepted a supplemental biologics licence application for the drug, based on positive results from phase III of the Caspian trial - which showed Imfinzi, in combination with standard-of-care chemotherapy, demonstrated a "statistically significant and clinically meaningful improvement in overall survival versus standard of care".
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COMPANIES - FTSE 250
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Student accommodation provider Unite Group has completed the acquisition of Liberty Living Group, a wholly owned subsidiary of the Canada Pension Plan Investment Board. Unite has issued 72.6 million shares at 25 pence each to Liberty Living to complete the deal. Unite will have 363.5 million shares in issue following the deal.
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Investec updated the market on its planned demerger and planned listing of its asset management business, which is to be renamed Ninety One Ltd. Ninety One will be dual listed, in London and Johannesburg, and is expected to be complete in March 2020. Transferring Investec Asset Management's assets into Ninety One is expected to have a positive impact on Investec's resulting CET1 ratio, of about 1.3% to 12.0%. The banking group is expecting to incur a GBP56 million cost for the demerger but Investec "strongly" believes the move will simplify its business and improve its long term prospects. Investec has committed to RoE between 12% and 16% for its Bank & Wealth business through 2022.
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COMPANIES - OTHER MAIN MARKET AND AIM
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Estate agent Countrywide has sold commercial real estate consultancy firm Lambert Smith Hampton for GBP38 million in cash. Countrywide said the business was non-core, and the funds will be used for its business turnaround. It also has agreed an amended credit facility with its lenders. Countrywide additionally announced on a share consolidation, but this first requires shareholder approval at its upcoming annual general meeting. Countrywide is proposing a 50 for 1 consolidation. The company currently has 1.64 billion shares in issue. Countrywide said the consolidation will improve its market liquidity, and reduce volatility and spread. "The group continues to make operational progress in its turnaround and confirms that it remains on course to deliver a full year result in line with the board's expectations," Countrywide added.
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Newspaper publisher Reach said its trading in in the past five months has been in line with management views. Like-for-like sales were down 4.4% in the period to November 24, but this is improved upon the 6.6% decline seen in the same period the year prior. Like-for-like print revenue in the five month period was down 7.3%, compared to down 8.2% a year before, but digital grew by 14%, versus 9.3% a year prior. Reach said it is confident its 2019 performance will meet expectations.
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COMPANIES - INTERNATIONAL
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Facebook said it has restored service following an outage on Thursday that hindered access to the social platform and its other apps such as Instagram. "Earlier today, people may have experienced trouble accessing Facebook's family of apps. The issue has since been resolved, we are back to 100% for everyone and we're sorry for any inconvenience," a company spokesman said in a statement. Facebook blamed "an issue in one of our central software systems" for snarling connectivity for several hours.
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Friday's Shareholder Meetings
PME African Infrastructure Opportunities
Range Resources
Ncondezi Energy
Oncimmune Holdings
Galliford Try (re purchase of Linden Homes by Bovis Homes)
Petra Diamonds
Infrastrata (re completion of placing)
Macau Property Opportunities Fund
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By Tom Waite; thomaslwaite@alliancenews.com
London Briefing is available to subscribers as an email newsletter. Contact info@alliancenews.com
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