Shareholders in Ocado (OCDO) are still waiting for details about which European retailer has licensed its platform software, although the online grocer did note that it is having further conversations with multiple retailers, and has signed a general merchandise partnership with garden centre Dobbies to help launch its online business. But higher volumes fed distribution costs, those strategic initiatives lifted administrative expenses, and the kick-off for operations at its Andover CFC distribution centre pushed up depreciation charges. All this meant underlying operating profit fell from £11.8m to £11.2m.
The retail division fared well with revenue up 12.5 per cent to £660m as its active customer base (those that have shopped within the previous 12 weeks) grew by 11.3 per cent year-on-year to more than 600,000. Order volumes increased by 15.6 per cent to an average of 260,000 orders per week but the value of the average customer's basket fell from £109.94 to £108.45 as customers shopped more frequently.
Analysts at Numis expect pre-tax profits of £8.4m in the year to November 2017, giving an EPS of 1.4p, down from £14.5m and 2.4p in FY2016.
| OCADO (OCDO) | ||||
|---|---|---|---|---|
| ORD PRICE: | 292p | MARKET VALUE: | £1.75bn | |
| TOUCH: | 292-292.7p | 12-MONTH HIGH: | 340p | LOW: 210.5p |
| DIVIDEND YIELD: | na | PE RATIO: | 160 | |
| NET ASSET VALUE: | 45.7p* | NET DEBT: | 77% | |
| Half-year to 28 May | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2016 | 584 | 8.5 | 1.45 | nil |
| 2017 | 714 | 7.7 | 1.26 | nil |
| % change | +22 | -9 | -13 | - |
Ex-div: na Payment: na *Includes intangible assets of £96m, or 16p per share | ||||
