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First-half revenues at Ocado (OCDO) have increased 15.1% to £584.2m but the online grocer still shows no signs of striking a long-awaited deal with an international partner.

CEO Tim Steiner said this morning that tests on new software in the new facility in Andover were progressing well and mad the Ocado Smart Platform an “even more attractive solution” for retailers outside the UK. He added he remained confident about signing up partners to the platform.

Pre-tax profits at Ocado in the 24 weeks ended 15 May 2016 came in at £8.5m, compared with £7.2m in the same period last year.

Ocado, which has just won Online Supermarket of the Year at The Grocer Gold Awards, pushed up its active customer numbers by 14.9% to 541,000 in the half, with new customer acquisitions up 11% year on year.

Average basket value declined by 2.2% in the period to £110.10 as price deflation in the market continued to hit the business. But order volumes grew by 17.8% to an average of 225,000 orders per week, with the highest number of orders delivered in a week reaching 250,000.

Ocado’s own-label also continued to grow with sales up by 11% and more than five products in the average customer basket.

“I am encouraged by the steady progress in our business, with volumes through our operations, including the throughput for Morrisons, growing by 30%,” Steiner said. “The market remains competitive with ongoing price deflation but our increasing scale and operational efficiencies meant that we still grew profits, albeit at a slower rate.

“We have been gaining share in the online grocery market and expect this to continue. The last few years have shown beyond doubt that British shoppers are choosing the benefits of grocery shopping online and we believe that the momentum of channel shift away from bricks and mortar stores will continue. The more opportunities customers have to try grocery shopping online, the more they will be attracted to Ocado’s superior customer offer.

“Testing of our new proprietary fulfilment and software solutions in our third facility in Andover is progressing well and we expect to move out of our test phase in the autumn post the quieter summer period. This and other innovations in technology that benefit our customers not only strengthen the Ocado retail brand but also make the Ocado Smart Platform an even more attractive solution for retailers outside the UK looking to build their own online grocery offer. I remain confident about signing up partners to this platform.”

Morning update

Despite no update on an overseas deal, Ocado shares have jumped 6% since markets opened to 220.6p. The stock has taken a hammering in recent weeks (see below) as investors worry about the impact of Amazon Fresh but the latest figures show there is still plenty of growth left in the business.

The grocery market has fallen into decline for the first time since January this year with sales at the tills falling by 0.2% as like-for-like prices decreased by 1.4%, the latest grocery figures from Kantar Worldpanel for the 12 weeks to 19 June have revealed. Kantar added that the impact of the EU referendum result was too recent to be felt, but precedent suggested grocery sales are unlikely to see a significant fall.

Overall sales at Tesco dropped by 1.3% in the period, while Morrisons recorded a 2.4% decline, both reflecting the ongoing impact of store disposals. Sainsbury’s sales fell by 1.4% and Asda’s woes continued with sales plunging 5.9%. Each of the big four lost market share on last year.

Aldi and Lidl reached a combined share high of 10.5% as 58% of Britons visited one of the retailers in the past 12 weeks. Co-op achieved a full year of increasing sales, growing 2% this period, and Waitrose’s premium Waitrose 1 range helped it post a run of growth dating back to 2009.

Fraser McKevitt, head of retail and consumer insight at Kantar Worldpanel, said: “The decline is a continuation of the slow supermarket sector growth dating back to summer 2014, primarily a result of cheaper everyday groceries brought about by a retailer price war.

“While these latest figures predate the EU referendum result, the immediate economic uncertainty is unlikely to cause a substantial fall in grocery volumes, as demonstrated by the 2008 financial crisis when basic food, drinks and household sales proved resilient.

“With an estimated 40% of the food we consume sourced from overseas, any long term change in exchange rates may threaten the current period of cheaper groceries. Historically, higher prices have led to consumers looking for less expensive alternatives such as own-label products, seeking out brands on promotion or visiting cheaper retailers.”

Nielsen retail performance data, also released this morning, showed that UK supermarkets recorded the first “genuine” increase in year-on-year takings at the tills since July 2015 as Euro 2016 boosted alcohol and crisps sales. And the market data firm said Brexit was unlikely to change shopper behaviour in the short-term.

During the four weeks ending 18 June 2016, the sales value was up 0.4% versus the same period a year ago. The last time sales value increased year-on-year (excluding an Easter-inflated period) was the four-weeks ending 18 July 2015. But sales volume remained flat for the second consecutive period.

“It remains a tough trading environment for the big supermarkets but changes made over the last year in lowering prices, less promotions, edited ranges and improved customer service seem to be having an impact, alongside the drop in shoppers buying cheaper grocery brands to save money,” said Mike Watkins, Nielsen’s UK head of retailer and business insight. “Furthermore, deflation is no longer deepening and, with the effect on figures of some store closures last year soon to be behind us, we can be more optimistic about a supermarket recovery later this year.”

Nestle has appointed a new CEO to replace the long-serving Paul Bulcke, who is set to take the role of chairman next year. Ulf Mark Schneider will join Nestle in September to take over from Bulcke at the start of 2017. Schneider, 50 years old and a German and U.S. citizen, has been CEO of health care company Fresenius Group since 2003. It comes as the Swiss consumer goods giant continues to attempt to shift towards being a nutrition, health and wellness company.

Bulcke has been at the helm of the Swiss consumer goods giant for eight years and has in recent times sought to focus more on nutrition, health and wellness. The Nestle board has proposed that Bulcke will become the next chairman at the AGM in April 2017. Current chairman Peter Brabeck-Letmathe, who has reached the mandatory age of retirement at 71,will not stand for re-election having served Nestle for 50 years, 14 on the executive board, 11 years as CEO and 12 as chairman, will have

Brabeck-Letmathe said: “With the proposed appointment of Paul Bulcke as chairman and Ulf Mark Schneider as CEO, the board has increased the company’s capabilities to accelerate Nestle’s journey to become the world’s preeminent player in the nutrition, health and wellness sector.”

Schneider, who is Nestle first external hire for the CEO job in almost 100 years, added: “I am honoured and excited to have the opportunity to join Nestle. This is a truly iconic global company with a proud heritage and tremendous future prospects. With consumers around the world taking a deeper interest in their personal health and wellbeing, Nestle’s industry-leading global food and beverage business positions it well for advancing the vision of nutrition, health and wellness. I very much look forward to working with the Nestle team and all Nestle stakeholders as we continue to pursue this vision.”

Aside from the rise in Ocado shares, the FTSE 100 has bounced back 2.1% to 6,109.74 points so far today with most grocery/fmcg shares back in the black. Tesco is up 3.2% to 158.6p, Morrisons 2.4% to 178.8p and Sainsbury’s 2.2% to 222.6p.

Yesterday in the City

Ocado investors flocked from the stock yesterday ahead of this morning’s interims, with the share price tumbling 14.2% to 208.1p.

Elsewhere, the aftershocks of the Brexit vote were still being felt across markets, with the FTSE 100 being dragged down another 2.6% to 5,982.2 points as banks, property and airlines shares being pummelled.

The FTSE 250, which is more reflective of British business, slumped 7% to take the index down more than 13% since Thursday’s vote.

Associated British Food (ABF), Marks & Spencer (MKS), B&M (BME) and Hotel Chocolat (HOTC) all took a hammering as investors worried what Brexit would do for consumer confidence on the high street. The shares fell 15.3% to 2,350p, 12.6% to 285.2p, 9.2% to 233.1p and 6.7% to 175p respectively.

Tesco (TSCO), Morrisons (MRW) and Sainsbury’s (SBRY) all were affected ahead of the latest market share numbers, falling 5.3% to 153.7p, 4.6% to 174.6p and 4.1% to 217.8p.

Britvic (BVIC), SSP Group (SSPG), Booker (BOK), Cranswick (CWK), Greggs (GRGS), like most grocery, retail and fmcg stocks, also took heavy losses, plunging between 4% and 7%.

Diageo (DGE), Unilever (ULVR), Reckitt Benckiser (RB) and British American Tobacco (BAT) all defied the general downturn, rising 1.9% to 1.914p, 1.4% to 3,310.5p, 1.4% to 6,991p and 1.6% to 4,455p respectively. The four businesses all earn a majority of their revenues outside the UK.

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