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Ocado sees double digit jump in Q3 revenue

Ocado sees double digit jump in Q3 revenue

Online supermarket Ocado has announced an 11.5% jump in revenue for the 13 weeks to the beginning of September.

Good performance was experienced at its state of the art fulfilment centres in Andover and Erith, with very strong initial growth at Erith.

Its boost in performance was mainly attributed by a double-digit growth in average orders per week with average customer shopping spend at £106.

As at 2 September 2018 the Group had cash and cash equivalents of £406.1m and external borrowings of £281.2m.

Tim Steiner, Ocado's Chief Executive Officer, said: "The new capacity from Andover and Erith, our robotic third and fourth warehouses, is helping meet consumer demand for our services and drive the channel shift which is transforming grocery retailing in the UK. We are proud to have opened our Erith Customer Fulfilment Centre this summer on time and on budget. At full capacity, this latest state-of-the-art CFC will be the largest automated warehouse for online grocery in the world. We are delighted to report that last week Erith processed over 20,000 customer orders 14 weeks after opening, a number which took Andover 15 months to achieve. Together, Andover and Erith provide new opportunities for growth in our UK retail business while showcasing the scalability, adaptability and efficiency of our platform.

"Ocado's unique and proprietary technology, which makes these facilities work, is bringing greater value, quality and convenience to British shoppers while at the same time helping our partners redefine the shopping experience for their own customers. We are on track to deliver a significant number of new CFCs for our Solutions partners in the coming years and as such are fulfilling our goal of changing the way the world shops."

Manu Tyagi, Associate Partner, Retail and Consumer Goods Practice at Infosys Consulting gave her assessment to the latest set of figures from the retailer. He said: “Ocado’s rising sales figures provide the perfect example of the impact automated warehouses are having on online retail. With the roll-out of its hi-tech warehouses leading to a jump in sales, Ocado have proven the benefits of incorporating robots and large-scale automation into the complex world of grocery.

“It’s no secret that the rise in connectivity has led to an age of urgency in retail. Consumers now expect to order and receive items in a matter of hours, an expectation that has recently extended beyond Amazon orders and into consumers’ weekly grocery shops. Automation, when rolled out efficiently, can help boost ecommerce sales by providing consumers with what they want, when they want it. Retailers both online and on high streets are under constant pressure to keep up with this growing customer demand.

“Ocado is clearly an example of automation done right. What Ocado has done especially well is balance the use of both humans and machines in its operations. By retaining workers for ‘intelligent’ jobs – such as sales and business strategy – and deploying robots to do manual work like picking and packing, Ocado have not only streamlined but also enhanced their supply chain. Today’s figures show that shareholders and customers alike are reaping the rewards.”

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