Ocado swings to H1 loss as retail EBITDA drops

Online grocer Ocado said on Thursday that it had swung to an underlying loss in the six months ended 29 May, principally due to a £72.8m drop in retail EBITDA as a result of lower sales and cost inflation.

Ocado posted a group LBITDA of £13.6m, versus the previous year's EBITDA of £61.0m, while pre-tax losses came to £758.8m, a marked reversal when compared to the £188.5m pre-tax profit delivered the same time twelve months earlier.

Group revenues slipped 4.4% to £1.26bn, with retail revenue dropping 8.3% to £1.12bn and offsetting a 10.7% increase in UK solutions and logistics revenues and a 119% surge in international solutions revenues to £395.6m and £58.5m, respectively.

The FTSE 100-listed firm also said capex had risen from £319.0m in 2021 to £366.8m twelve months later and noted that it had fallen from a net cash balance of £188.5m at the midway point of the prior year to a net debt position of £758.8m just twelve months later.

Chief executive Tim Steiner said: "The last six months has seen significant progress at Ocado Group and we have put all the building blocks in place to deliver profitable growth and strong cash flows.

"With these building blocks in place, notwithstanding the near-term challenges for the consumer in the UK, we look forward to the future with confidence".

Reporting by Iain Gilbert at Sharecast.com