Ocado shares push upwards despite 4% sales dip

Ocado Retail has blamed the end of lockdown and labour shortages as Q4 sales dipped almost 4% since last year.

The company, a joint venture between Ocado and Marks & Spencer, also saw its average basket size drop 12% to £118.

However, order numbers up 8.5% to 375,000 per week, while sales are up almost a third on 2019 levels.

Chairman Tim Steiner said it showed the “vast majority” who started using Ocado at the start of the pandemic “are continuing to shop online”.

READ MORE: Roboshop: Is Ocado the future of supermarkets?

The results drew a warm response from investors, with shares bouncing 6.7% when markets opened.

Sales growth was apparently hampered by labour shortages, even though Ocado warehouses are largely staffed by grocery-packing robots.

A fire at its Erith hub in July, which took fire services 12 hours to get under control, is also thought to have hurt order numbers.

“We are very encouraged by the underlying trends which are driving growth in our business,” Steiner said.

“Hundreds of thousands of UK consumers have tried online grocery over the last eighteen months and the vast majority are continuing to shop online and are not going back to physical stores.

“At a time of growing momentum in the channel shift from physical stores to online we… are on  a strong, long-term growth trajectory.”

Like most companies, Ocado Retail has been hit by price inflation, and is said to be bringing in “various cost management measures”.

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