Ocado brings in auditors in wake of Tesco profit scandal

OCADO has launched an internal investigation to verify that its agreements with suppliers are above board in the wake of the

crisis engulfing Tesco, writes

RupertSteiner.

The online grocer, which has just broken through the £1bn mark for annual sales, said the probe included a health check from an external auditor.

It credited having a broader range of products and more competitive pricing as the drivers of fourthquarter sales.

The firm, which mainly sells items from Waitrose supermarkets, posted a 14.9pc increase in gross sales to £311.4m for the 16 weeks to November 30. Shares rose 21.40p to 355.40p despite trading having slowed from the 15.5pc increase seen in the previous quarter. Gross sales were £1bn for the 52 weeks to November 30, up 20.4pc. The performance is still strong given the turmoil in the traditional grocery market, which saw Tesco issue another profit warning this week. Shoppers have shifted their shopping patterns from large supermarkets to smaller convenience stores and online, while discounters Aldi and Lidl have also triggered a price war, wooing onceloyal shoppers. This has taken its toll on Ocado which saw the amount spent on an average basket fall from £111.64 to £109.74.

It says that fall is due to shoppers buying fewer items more often and from a range of other Ocado-linked websites, such as its outlet for pets, Fetch.

Despite that it saw a rise in shoppers flocking to its main website. Average orders per week were up 16.4pc to 177,000. Chief executive Tim Steiner,

pictured, said: ‘We are pleased with the continued steady growth in our business against the backdrop of a more competitive grocery market.’

Neil Saunders, managing director at retail analysts Conlumino, said: ‘Looking ahead we remain confident that Ocado can continue to grow its share of the market. That said, if the grocery price war intensifies Ocado may well find its own margins under pressure because of its price-matching scheme.’