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I honestly prefer hilarious bulls*** posts like this to the:
-"Why is the price down" (price goes down 0.5%) or
-"What are people's price targets" or
-"I just bought xxx shares"
vacuous posts.
I have so many people filtered now it's getting stupid. Like the people I filter.
Price targets are irrelevant in a sentiment-driven stock like Ocado.
Thank you Valueplay.
I hope Ocado's value will be realised soon. My dream would be for Ocado *Solutions* to be listed on the US stock exchange. I have no idea when this could happen but the time is surely ripe.
At the risk of posting too much today.... what does the "Deconsolidation of Ocado Retail" mean? Is it simply some administrative rearrangement of no consequence or could it pave the way to Ocado Solutions being spun out as a separate entity (as we all would like to see I expect!)?
This is the text from the RNS:
"Ocado Group plc and M&S are both joint equal shareholders of Ocado Retail Limited. At present the results of Ocado Retail Limited are consolidated into the results of Ocado Group plc as Ocado Group plc are deemed to be the controlling shareholder via certain tie-breaking rights. Our current intention is to give up those tie-breaking rights to M&S in early April 2025. There will be no change in the economic interest of both shareholders in Ocado Retail Limited, or any consideration paid by M&S, as a result of this proposed change. After giving up the tie-breaking rights to M&S, we expect that the results of Ocado Retail Limited will cease to be consolidated into the results of Ocado Group plc and will instead be equity accounted for as an investment from this point onwards. From this point, M&S would have the right to consolidate the results of Ocado Retail Limited pursuant to the terms of the original Shareholder Agreement signed in August 2019 when the Joint Venture was formed."
Okay, so my assumption is that Ocado changed the way they present accounts (to IFRS 13???) and as a result have to make this deduction to balance the numbers.
Okay, so separate to revenue.
That £67m is quite a lot to lose... what does that practically mean? Is it part of the fee that they think M&S will not pay them? Or is it loss of goodwill in Ocado Retail?
As title. £187m paid by Autostore to Ocado but which revenue figure is this included in?
If it is part of Solutions revenue, that suggests that Solutions revenue apart from that payment has actually decreased.
Much appreciated!
Incredible post. Thank you for your service good sir!
Definitely a steady day! The graphs never lie right? They are soooo reliable.
I have to agree that the drop was overdone today.
That said, this should be drifting down and definitely not up IMO given the lack of uptake of new CRCs. Kroger has stopped expanding their CFCs to be "sure that we have a clear path" whatever that means.
This is a sentiment-driven stock and there is naff all positive going. Hasn't been since about a year ago.
"increasing all the time"... you should get a job in marketing!!!
Last time I checked their biggest customer Kroger had stopped expanding use of Ocado kit! Sept 2023
https://www.grocerydive.com/news/kroger-ocado-grocery-cfc-delivery-pickup/693287/
The future is uncertain and more so than it's ever been for Ocado.
Okay, so we would expect Alison in the next few years to start making decisions on property and if she decides to keep them, that's 1-2B extra to be spent. Now let's see some of that strong leadership!
M&S is saving £197m so not too bad for them. Weird thing seems to be from my reading that the payment was dependent on results to November 2023 however it was due to be paid in August 2024. Source:
https://www.sharecast.com/news/news-and-announcements/ms-withholding-multi-million-pound-payment-to-ocado-over-performance-failures--16315488.html
The solutions stuff grew by 59% in the half year results in 2023 so clearly that is where the money is. That said, Ocado has been going almost 24 years so those basic patents must be expiring in the next few years.
Ocado half yearly report 2023 was released 18th July 2023 so when is the next one due?
People bleating on about AI clearly don't understand the minuscule role of it in Ocado.
The robots are the innovation here. A basic machine learning algorithm to predict what a customer will buy next is nothing special.
Thanks Fleccy, looks like my searching in the document was too lazy. :-|
£449 is very little which puts paid to any theories that BT will rake it in by selling their vacated property. So the savings will mostly be on rent/short leases.
Probably but also it doesn't matter long term I don't think. At this point I lose track of Ocado's losses. All I know is there was that one year they made profit that everyone remembers.
Thanks, that's a really useful link.
"As part of a wider property outsourcing arrangement, in December 2001, we completed the sale and leaseback of
the majority of our UK property portfolio to Telereal, a 50/50 joint venture partnership between Land Securities Trillium
and The William Pears Group, for £2.4 billion in cash. Around 6,700 properties – ofÆces, telephone exchanges,
vehicle depots, warehouses, call centres and computer centres, totalling some 5.5 million square metres – were
effectively sold."
and later:
"We have retained direct ownership of approximately 220 properties. A number of these were retained with a view to obtaining better value through other means."
Fast forwarding to 2023 the annual report says that "Property, plant and equipment" is worth £21B but does not break down how much of that is property and indeed how much value will be brought in by that which is being sold. This is what I would really love to know.
I've googled the heck out of this but am still unclear on whether BT owns its exchanges or not. I found this article from the Guardian in 2001 that says they sold them to Telereal to get cash quickly, and then leased back the properties:
https://www.theguardian.com/media/2001/jun/13/bt.citynews
Presumably they pay rent effectively or maybe they bought short term leases to save them money?
Does anyone know the timeline for the company being wound up?