Home retail Ocado lifts profit forecast as pandemic sends shoppers online

Ocado lifts profit forecast as pandemic sends shoppers online

Ocado lifts profit forecast as pandemic sends shoppers online

Online food retailer Ocado has raised its full-year profit forecast, cementing its position as one of the corporate winners from a pandemic that has driven ever more people to shop online.

The UK company, which has sold its technology to supermarket groups across the world, including Kroger in the US, said on Monday that it expected earnings before interest, tax, depreciation and amortisation to be more than £60m in the 12 months to the end of November. That is up from previous guidance of more than £40m.

Its joint venture with Marks and Spencer, Ocado Retail, was enjoying a strong performance in the final quarter of the year, the retailer said in an update on trading.

The coronavirus crisis has turned Ocado into one of the hottest investments on the UK stock market. Shares in Ocado jumped 7 per cent in early trading, giving the company a market capitalisation of £17.9bn.

Separately on Monday, Ocado said it had agreed to buy a San Francisco-based robotics company Kindred Systems for $262m. The US group, which has about 90 employees, develops robots used in picking and packing online orders. Ocado said it was also paying $25m for Haddington Dynamics, which is based in Las Vegas and makes robotic arms.

Tim Steiner, chief executive of Ocado, said the acquisitions would “allow us to accelerate delivery, innovate more and grow faster”.

The UK retailer said it expected the acquisitions to boost full-year revenues in its next financial year by about £30m, but have a “small” hit on earnings. 



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