We use your sign-up to provide content in ways you’ve consented to and to improve our understanding of you. This may include adverts from us and 3rd parties based on our understanding. You can unsubscribe at any time. More info
It said that its losses widened from £52.3million to £176.9million, while its revenues for the year to November 28 grew 7.2 percent to £2.5billion. Ocado fell deeper into the red after spending £680.4million – up from £525.6million a year ago – investing heavily in technology for a new generation of robotic warehouses. It plans to increase its capital expenditure to £800million this financial year.
Analysts have been left wondering when it will return to the black. Ocado last made an annual profit in 2016.
When the UK confirmed its first coronavirus cases on January 31, 2020, its shares traded at 1,223.5p.
They shot up as demand soared in lockdown and peaked at 2,914p on September 30, 2020 but have since sunk.
“Ocado shares have slid to 22-month lows, despite improving full-year revenues to £2.5billion, a decent improvement on last year’s £2.3billion,” said CMC Markets chief market analyst Michael Hewson.
“Losses increased to £176.9million, a big fall from last year’s £52.3million loss.
“Higher capital expenditure of £680.4million over the year, along with higher spending of £800million for 2022 has raised concerns as to the timeline of when shareholders will see the business return a profit.”
Clive Black, Shore Capital’s head of research, said: “Sadly, lowered [profits] guidance and the extension of the jam tomorrow corridor is par for the course from Ocado.
“It is a distinctive business that blends undoubted innovation and, seemingly, potential, with an inability to break even and create a pathway to sustainable self-funded development.”
Ocado is to open nine warehouses this year, six in the US, and one each in the UK, Canada and Sweden.
Source: Read Full Article