Shares in Ocado (OCDO) slipped into reverse following the release of these figures, partly as a consequence of a general market correction, with the mood hardly enhanced by news of a placing of 31.5m shares. The group reported a decent acceleration at the top line as customers increasingly turned online for weekly food shops, but the technology provider slipped back into the red by £0.5m (on an equal 52-week basis), compared with a £12m profit last year.
A slew of new international deals has thrown significant momentum behind the share price lately, but management believes it could spend up to £210m in capital expenditure this year to facilitate these future contracts. The group also said current-year cash profits would “reflect the fixed costs” involved with building and expanding existing logistics hubs in the UK – comments some City analysts likened to a profit warning.
The share placing has therefore been designed to ease the group’s – not to mention investors’ – short-term suffering. Although pricing wasn’t made clear to the market, Peel Hunt reckons a fundraising at the previous day’s closing price would drum up £155m. For now, the broker still expects adjusted pre-tax profits of £7.6m and EPS of 1.2p for the year ending November 2018, moving to £12m and 1.6p in FY2019.
OCADO (OCDO) | ||||
ORD PRICE: | 461p | MARKET VALUE: | £2.76bn | |
TOUCH: | 460.7-461.3p | 12-MONTH HIGH: | 551p | LOW: 233p |
DIVIDEND YIELD: | NIL | PE RATIO: | NA | |
NET ASSET VALUE: | 45p* | NET DEBT: | 84% |
Year to 3 Dec | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
2013 | 0.79 | -12.5 | -2.2 | nil |
2014 | 0.95 | 7.2 | 1.2 | nil |
2015 | 1.11 | 11.9 | 2.0 | nil |
2016 | 1.27 | 12.1 | 2.0 | nil |
2017** | 1.46 | 1.0 | 0.2 | nil |
% change | +15 | -92 | -92 | - |
Ex-div: | na | |||
Payment: | na | |||
*Includes intangible assets of £112m, or 19p a share **53-week period |