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(Alliance News) - FTSE 100-listed grocery delivery firm Ocado Group PLC said Tuesday its interim loss deepened due to the effects of a warehouse fire in Hampshire, but it continues to experience healthy sales growth amid "strong" demand.
For the six months ended June 3, pretax loss widened dramatically to GBP142.8 million from just GBP13.6 million a year prior. This was despite revenue rising 11% to GBP882.3 million from GBP795.3 million, as retail revenue grew 10% to GBP811.5 million from GBP736.6 million.
Profit performance was primarily hurt by GBP100.6 million in exceptional administrative costs during the period. This was largely the write down of property, plant and equipment following a fire at Ocado's Andover warehouse.
Adjusted pretax loss, excluding such one-off costs, still worsened to GBP43.0 million from GBP12.9 million the year before.
"In the last six months the centre of gravity at Ocado Group has shifted," Ocado Chief Executive Officer Tim Steiner said. "Our exciting new joint venture with M&S creates further growth opportunities for both parties in the UK and allows Ocado Group to increase focus on growing our Ocado Solutions business and innovating for our partners."
Ocado does not pay a dividend.
"We have never had as many opportunities to grow as we do today," Steiner added. "As we look to successfully scale our business and deliver outstanding execution to our partners, our challenge will be to select and prioritise the most attractive of these opportunities."
Ocado retained its current second half guidance. The firm expects retail revenue to rise between 10% and 15% despite the Andover fire amid "strong" underlying demand. The firm does expect a GBP15 million impact on profit from further Andover-related business disruption.
Back in February, Ocado and Marks & Spencer Group PLC entered a 50-50 joint venture for online grocery shopping, combining M&S's branded food and beverage range with Ocado's own label and third-party products.
