Ocado loss widens to $108m in first half

British online food retailer Ocado said yesterday that first-half net loss deepened on heavy investment made to help meet booming demand during the pandemic.

Loss after tax hit £77.8 million ($108 million) in the first half of its financial year or six months to May, Ocado said in a results statement.

That was worse than the £57.4 million loss posted in the same period of 2020, when the Covid19 pandemic erupted and sparked heightened demand for online food supplies.

However, Ocado added that earnings before interest, taxes, depreciation and amortisation (EBITDA) more than tripled to £61 million in the first half.

And sales surged 21.4% to £1.3 billion in the reporting period, despite the easing of coronavirus curbs in England since March.

Ocado sells food via its app and website under a tie-up with traditional high-street retailer Marks & Spencer, and also sells its technology to supermarket firms around the world.

The company has ramped up investment in highly automated customer fulfilment centres, as more people switch to online grocery deliveries.

“As we head towards a post Covid19 future, it is increasingly clear that the landscape for grocery worldwide has changed, for good,” said chief executive Tim Steiner.

“Over the last eighteen months, we have shown that the Ocado model works even in the most challenging and fluid of environments.

“That ours is a proven model in online grocery has been again demonstrated by the strong performance of Ocado Retail, the historic core of the Ocado business, which has led the market in customer experience, increasing sales by 20% in the period, thanks to a significant increase in customer numbers, while continuing to show sustainable and industry-leading profitable growth,” he added.

Ocado has signed a deal with Auchan to help develop online activities of the French giant’s Spanish division Alcampo.