(Alliance News) - Ocado Group PLC on Tuesday said retail revenue in its third quarter surged by more than 50%, driven by a shift to online grocery shopping in the UK and a positive customer response to its switch from Waitrose products to Marks & Spencer goods.
The FTSE 100-listed online grocer said that for the 13 weeks to August 30, Ocado Retail revenue rose by 52% to GBP587.3 million, compared to GBP386.4 million in the 13 weeks to September 1, 2019, as the channel shift to online grocery in UK continues, with weekly orders increasing due to a combination of strong demand, a phased reopening of the website to new customers, and a normalising of shopping patterns.
Average orders per week also rose 9.6% to GBP345,000. Ocado highlighted that while the average order size has continued to normalise from Covid-related peaks to GBP141, it remains above pre-crisis levels.
Shoppers have responded favourably to the switchover to M&S products on September 1, Ocado said, adding that the weighting of M&S products in the average Ocado basket is higher than for Waitrose products prior to the switchover.
Looking forward, Ocado said it expects full-year earnings before interest, tax, depreciation and amortisation of at least GBP40 million, as it noted Ocado Retail's strong trading performance in the first three quarters of the year.
"Our aim is to continue to set the bar as we begin again to welcome new customers who are seeing the benefits of online shopping in ever greater numbers and we remain focused and on track to increase capacity by 40% through to 2021," said Melanie Smith, Ocado Retail's chief executive officer
Shares in Ocado were trading 5.9% higher at 2,494.15 pence each on Tuesday morning in London.
By Ife Taiwo; ifetaiwo@alliancenews.com
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Ocado (OCDO)