14th Jan 2025 10:59
(Alliance News) - Ocado Group PLC on Tuesday said it is confident to continue "market-leading" sales growth and volume momentum in the new financial year, as revenue for its joint venture with Marks & Spencer Group PLC, climbed comfortably in the fourth quarter of its financial year that ended in December.
The Hatfield, Hertfordshire-based licenser of grocery delivery technology said Ocado Retail Ltd's revenue for the fourth quarter that ended December 1 grew 18% on-year to GBP715.8 million from GBP609.4 million "as we continued to deliver on our strategy of unbeatable choice, unrivalled service and reassuringly good value".
The 50-50 joint venture's volumes increased 17% to 271.6 million total items from 232.2 million items on Ocado.com, while average orders also rose 17% to 476 per week, from 407.
For the full year, Ocado says retail revenue grew 14% to GBP2.69 billion while volumes and average orders per week both grew 13%.
The company added that Ocado Retail achieved "strong earnings before interest, tax, depreciation and amortisation growth" due to top-line growth "as well as continued focus on cost and efficiency".
Further, Ocado Retail celebrated "another record-breaking Christmas, with our highest ever level of sales over the peak Christmas trading period."
Ocado noted that the Christmas period was boosted by M&S party foods such as hot honey halloumi and pigs in blankets, as well as cheese and an ongoing popularity of low and no alcohol drinks.
Looking ahead, Ocado said: "We have confidence that the business will continue to show market-leading sales growth and volume momentum in FY25. Moreover, we expect to make further progress on driving operational efficiency and scale leverage, continuing on our journey towards a high mid-single digit adjusted Ebitda margin in the mid-term."
Ocado Retail Chief Executive Officer Hannah Gibson said: "As we enter the next phase of our strategy, we are excited about the future of online grocery and our role in shaping it. Priorities for this year are raising the bar again in our leading customer proposition, making further progress on improving profitability and transitioning the business onto new technology platforms."
Ocado will release results for the financial year ended December 1 on February 27.
Ocado shares were up 9.0% to 294.30 pence on Tuesday morning in London, giving it a market capitalisation of GBP2.46 billion. M&S shares were up 0.2% at 333.36p, for a market cap of GBP6.84 billion.
By Tom Budszus, Alliance News slot editor
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