Online grocer Ocado posted a widened loss of £12.5m in 2013 as it continues its operational shift in the online grocery market.
The firm, which is yet to make an annual profit, reported a sales rise of 17.2 per cent to £843m while its average basket size increased 1.3 per cent in 2013 compared to 2012. Ocado expects to spend £100m this year including £35m on bagging machines and refurbishments on aisle and cranes as well as £25m on technology. The news follows a 21 per cent sales surge over Christmas.
George Scott, Retail Consultant at Conlumino, commented: “The issue of profitability once again casts a long shadow, even as Ocado’s sales continue to increase.
“Ocado is well positioned in a polarised market, where discounters such as Aldi and Lidl are thriving at one end, while more premium players such as M&S, Waitrose and Ocado itself are also enjoying healthy gains, as consumers selectively trade up.”
Ocado, who recently signed a deal with Morrisons to invest in its services, are rumoured to have French giant Carrefour and Canadian chain Loblaws on its radar. It has expanded its grocery offering and now sells Swedish, South African and American Food and “soft- launched” its new online pet store Fetch.
The news comes as co-founder and Commercial Director Jason Gissing departs the company after 14 years. Shares fell 4 per cent today.
IGD forecast the online grocery market to grow by 124 per cent over the next five years to be worth £14.6bn in 2018.