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* 2021 core earnings fall 12.1%
* Warns 2022 core earnings won't meet market expectations
* Capex to rise to around 800 mln stg in 2022
* Says has encouraging pipeline for new deals
* Shares down 9.2%
(Adds detail, CEO quote, updates shares)
By James Davey
LONDON, Feb 8 (Reuters) - Ocado Group, the British
online supermarket and technology firm, warned core earnings in
2022 would undershoot market expectations as it steps up
investment in automated warehouses around the world, hammering
its shares.
The stock was down 9.2% at 1051 GMT on Tuesday, extending
losses over the last year to 53%, which also reflect investor
concerns over ongoing litigation with Norwegian rival AutoStore
.
Ocado reported a 12.1% fall in earnings before interest,
tax, depreciation and amortisation (EBITDA) to 61.0 million
pounds for its year to Nov. 28 as investment in the business
more than offset an increase in revenue.
The outcome was a touch above analysts' average forecast of
60 million pounds.
They had on average been expecting EBITDA to rebound to 92
million pounds in 2022.
However, Ocado's finance chief Stephen Daintith told
reporters the group was planning 30 million pounds more
investment in its International Solutions technology business in
2022 than the market had anticipated.
"That would imply therefore a 30 million pound lower EBITDA
for that segment in 2022 than current consensus and therefore a
similar lower level for the group number," he said.
Ocado forecast flat EBITDA for International Solutions in
2022, with a 50% increase in the UK technology business.
Investment in 2022 will support the launch of nine automated
warehouses as well as technology development.
Ocado has already struck partnership deals to provide its
technology to supermarket groups in eight countries, including
Kroger in the United States, Aeon in Japan,
Casino in France and Coles in Australia.
It has an "encouraging" pipeline for new deals and was in
talks with a number of retailers, it said.
Last week, Ocado unveiled a suite of technological
innovations from lightweight robots to hi-tech van routing
systems which it predicted would raise its returns and win new
customers.
"I can't understate the importance of these initiatives to
us, our partners and to the future of the grocery market
worldwide," CEO Tim Steiner told reporters.
Ocado's pretax loss widened in 2021 to 176.9 million pounds
in 2020, while revenue rose 7.2% to 2.5 billion pounds.
Capital expenditure increased to 680.4 million pounds and
was forecast to rise to 800 million pounds in 2022 as more sites
go live and others are ramped up.
The group forecast the Ocado Retail business, a joint
venture between Ocado Group and Marks & Spencer, would
return to "mid-teens" revenue growth in 2022, after growth of
4.6% in 2021.
($1 = 0.7393 pounds)
(Reporting by James Davey; Editing by Kate Holton, Louise
Heavens and Mark Potter)
