Ocado reports widened loss: ‘it has very low financial visibility’

July 19, 2023 03:04 AM AEST | By Invezz

Ocado reports widened loss: ‘it has very low financial visibility’ — Image source: Invezz

Analyst reacts to Ocado Group’s H1 update

Shareholders are content primarily because the grocery technology company reiterated its previous guidance. Still, Clive Black of Shore Capital said today:

Ocado has very low financial visibility. There’s virtually no basis for credibly model Solutions activity where to date, so much has been invested for such material accumulated losses.

The London-listed firm concluded H1 with £289.5 million of pre-tax loss that it related to one-off costs. Ocado Group had £211.3 million of loss in the first half of 2022.

Last month, Amazon was rumoured to be interested in buying Ocado (read more). The retail behemoth, so far, hasn’t made a definitive announcement, though.

Ocado saw revenue growth across all divisions

On Tuesday, Ocado reported a 9.0% annualised growth in its H1 revenue.

While strength was evident across all of its divisions, tech solutions was particularly noteworthy with a whopping 59% increase. Still, Clive Black added in his research note today:

We continue to feel unable to forecast Ocado’s medium-term financial output with any confidence. We don’t have a recommendation on its equity. Our caution remains palpable.

Ocado Group did, however, swung to £16.6 million of adjusted EBITDA versus £13.6 million of loss a year ago. Its joint venture with Marks & Spencer increased slightly to £1.18 billion on solid customer growth, increase in orders per week, and bigger basket on average.

The post Ocado reports widened loss: ‘it has very low financial visibility’ appeared first on Invezz.

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