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Ocado losses widen as contracts multiply

The online grocer has won a slew of new contracts but profits are suffering in the meantime
Ocado losses widen as contracts multiply

Ocado’s (OCDO) escalating losses did not deter the market from reacting positively to a 12.3 per cent rise in group revenue, which reflected a higher number of average orders per week and fees from new partnerships. Cash profits of £59.5m marginally beat consensus expectations, albeit down more than a fifth year on year as a result of costs associated with those new partnerships – specifically the building of new fulfilment centres and increased staff numbers. That said, analysts at Peel Hunt still expect cash profits of £81m for the year ending November 2019, representing growth of more than a third. 

IC TIP: Hold at 1,010p

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