Ocado sales growth picks up

Online grocer Ocado posted a 27 per cent rise in underlying earnings, forecast first-quarter sales growth of about 10 per cent and said the rate of growth should improve as the year progresses and capacity improves.

The group said Tuesday it made earnings before interest, tax, depreciation and amortisation (EBITDA) of £27.9m in the year to 27 November.

That was in line with analysts' consensus forecast, reduced after a December profit warning, of £28m and up from £22m in the previous year.

The group, which mostly sells the products of upmarket grocer Waitrose, said sales increased 16.6 per cent to £642.8m.

Ocado said in December earnings had been hit by higher staffing costs as it battled to overcome capacity constraints at its main distribution depot in Hatfield, north of London.

However, earlier this month the firm posted a 16.6 per cent rise in Christmas sales.

Shares in the firm gained some ground after that update but fell again less than two weeks later on fears over the firm's growth prospects after it said chief financial officer Andrew Bracey had been poached by recruiter Michael Page.