// Ocado Retail lowers its sales outlook as the UK market softens and shoppers return to offices
// The online grocer expects revenue growth in 2022 “closer to 10%”, having last month forecast growth in the “mid-teens”.
Ocado has lowered its annual sales outlook as it reported a 5.7% year-on-year fall in revenue in its latest quarter, which it said partly reflected a softening of the overall market as Covid restrictions eased and more customers returned to offices.
The online supermarket said retail revenue for the 13 weeks ended February 27 fell 5.7% to £564.7 million and said his was linked to a 4% fall in U.K. grocery market sales amid higher prices.
The grocer noted that its first-quarter performance was also up 32% when compared with the first quarter of fiscal 2020.
Regarding its outlook as a whole, Ocado said it now expected revenue growth in 2022 “closer to 10%”, having last month forecast growth in the “mid-teens”.
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The business, a 50:50 joint venture between Ocado Group and Marks & Spencer said smaller basket sizes offset an increase in the number of customer transactions.
The grocer said its average orders per week increased 12% to 367,500 orders, but that the value of the average basket declined by 15% to £124, “as customer behaviours return toward pre-Covid levels, reflecting the continued easing of pandemic restrictions and return to more in-office working.”
The group said its caution reflected uncertainties over inflation, which have increased significantly in recent weeks due to the war in Ukraine, the overall level of market demand, and the continued return to pre-Covid shopping patterns.
It also said it had increased some retail prices, where increased costs could not be mitigated, in line with the rest of the market and would continue to monitor the market to ensure alignment on prices.
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