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Online grocer Ocado posted a 19.2% rise in group sales for the first quarter despite a fall in average basket size as the retail price war intensified (OCDO)

Ocado said gross sales for the 12 weeks to 23 February rose from £227.5m to £271.1m while its retail sales climbed 15.2% to £252m.

During the period the average number of orders per week rose 18.1% to 183,000 although the average order size fell 2.4% to £114.72.

Ocado has been caught up in the price war, largely as a result of its commitment to price match Tesco on brands. Tesco’s key strategy in the early part of this year has been a concerted effort to lower the price of key branded lines.

“Our business continued to grow, against a backdrop of a retail market that remains challenging and competitive,” said Ocado CEO Tim Steiner.

“We remain committed to improving the quality of the proposition to customers, which we believe will support further growth. Notwithstanding the uncertainty that remains in the marketplace, we expect to continue growing slightly ahead of the online grocery market.”

 

Morning update

A quiet opening to the markets this morning. But an interesting appearance from Morrisons (MRW) among the biggest climbers. The retailer is set to deliver another tough set of reuslts on Thursday but there is clearly confidence in the new retail ‘dream team’ of chairman Andrew Higginson and CEO David Potts who starts next week. On early trading Morrisons shares were up 2.26% at 212.90p

 

Yesterday in the City

The FTSE 100 fell back further yesterday from its record heights of 6,974.3 points last week. The index was down 1.2% to 6,876.5 points – extending declines from Friday – as a result of the poor performance of property stocks.

In grocery, shares in Thorntons (THT) had another wobble, falling 1.9% to 71p. The stock has had an up-and-down couple of weeks as it struggled with poor sales in the commercial arm. Associated British Foods (ABF) also took a hit, with its share price down 1.9% to 3,069p.

Marks & Spencer (MKS) was another retailer to finish the day worse off after it revealed it was replacing its dividend payment with a discounted gift card. The stock dipped 1.3% to 504.5p.

At the other end, c-store group McColl’s Retail Group made up more lost ground after its shares fell last week after it said like-for-like sales had declined since its recent year end. The company finished yesterday 2.7% up at 170p.

Two other stocks which have fallen throughout the past week also rallied yesterday. Majestic wine and Ocado (OCDO) were up 1.9% to 347.5p and 1.7% to 367.1% respectively.

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