Ocado has reported a pre-tax loss despite a growth in sales, due to large investments in technology and new distribution centre openings.
In the 12 months to 28 November, the online grocer’s EBITDA widened from £52.3 million to £176.9 million.
However, group sales rose by 7.2% to £2.5 billion in the same period, and retail sales rose by 4.6% to £2.3 billion.
READ MORE: Ocado accuses Autostore of “misleading” investors over court proceedings
Ocado chief executive and co-founder Tim Steiner explained large investments were made to create “an unequalled customer experience through ground-breaking technology” for an “unrivalled low-cost operation.”
Additionally, Ocado opened five new distribution hubs globally, including a US debut with two new centres in the region.
Three sites have opened in the UK, including a small site in Bristol and two larger sites in Purfleet and Andover to increase capacity by around 40%.
The expansion comes as Ocado’s UK operation suffered a reduction in capacity due to a fire in its Erith distribution centre in July.
Furthermore, the online retailer said growth was stagnated by the HGV driver shortages which were “constrained in the second half of the year by ongoing tight labour market in the UK.”
Despite overlapping challenges, Ocado sales grew steadily as it continued to benefit from people shopping from home for Covid safety.
Customers numbers increased by 22,4% to 832,000 and numbers of orders rose by 11.9% to 357,000.
However, the amount spent per basket fell by 5.8% to £129 amid high inflation rates and surges in the cost of living.
The news comes as Ocado’s court battle with AutoStore is set to reach UK’s High Court where both parties are arguing the other breached intellectual property laws.
Ocado revealed several millions of pounds have been spent on the case so far, but the outcome remains “uncertain” despite confidence in the “integrity of their intellectual property portfolio.”
Click here to sign up to Retail Gazette‘s free daily email newsletter
