Ocado’s Andover factory fire will hurt first quarter sales, the retailer warned today, adding that it will continue to impact sales in the months to come.
The three-day blaze destroyed one of Ocado’s flagship robotic distribution centres and sent shares down 12 per cent in early February.
Today the firm revealed revenue grew 11.2 per cent to £404m in the three months to the end of February, with the inferno costing it 1.2 per cent in lost sales growth.
Chief executive Tim Steiner today warned that figure would triple in the current quarter as Ocado races to replace the lost functionality at its Erith facility.
However, Steiner added: "The fire has been a setback, but it will only be a temporary one."
The fire at the firm’s flagship automated robotics site in Andover, which comes as the company ramps up its transformation plan to build robot-operated warehouses for retailers across the world, saw hundreds of millions of pounds wiped off of the blue-chip firm’s stock value last month.
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The Andover factory, which accounts for 10 per cent of capacity and can process roughly 65,000 orders a week, caused devastation to both its roof and contents inside.
Today's results come several weeks after Ocado revealed its planned tie-up with M&S, in a move that will give the high street giant a home delivery service for the first time.
On a media call this morning, Ocado’s chief financial officer Duncan Tatton-Brown said that today's results showed "how resilient we are that if we lose 10 per cent capacity but our sales are only impacted this modestly".
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M&S is set to pay Ocado roughly £750m for a 50 per cent stake of the new joint-venture, which will come into force late next year after Ocado’s tie-up contract with Waitrose comes to an end.
However, Richard Hunter, head of markets at interactive investor, said: "The fire at the Andover centre appears to have done little to quell Ocado’s rampant growth. It is estimated to have taken the equivalent of 1.2 per cent of sales in the quarter, but given that revenues rose 11 per cent, the effect has been contained. Repairs to the centre will of course be a diversion, but the site was fully insured and it is with some irony that the company will be able to build an improved replacement which is fully state of the art."