REG - Ocado Group PLC - Update on shared UK CFCs

OcadoAnnouncement

28/11/2024 07:00

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RNS Number : 9380N  Ocado Group PLC  28 November 2024

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION

 

 

 

28 November 2024

 

Ocado Group plc

Update on shared UK CFCs

 

Ocado Group ("Ocado") provides technology solutions to two grocery partners in
the UK,

Morrisons and Ocado Retail Ltd. They currently share fulfilment capacity at
two Customer Fulfilment Centres ("CFCs") in Dordon and Erith. We engage
actively with both Morrisons and Ocado Retail to support their expansion and
development within the online grocery market. This includes strategic
discussions on the optimal use of our CFCs to support each partner to achieve
their growth ambitions.

 

Following recent discussions, Morrisons will gradually cease deliveries from
Ocado's Erith CFC in order to continue building further volumes from Ocado's
Dordon CFC, as well as expansion of their store network where online orders
are fulfilled using Ocado's AI-powered In-Store Fulfilment solution.

 

Ocado has supported Morrisons.com's growth since May 2013, helping to
establish and build an online grocery business delivering Morrisons unique
blend of customer service, value and fresh food to thousands of shoppers each
week. Morrisons.com is enabled by Ocado's world-leading technology, the Ocado
Smart Platform, which also enables the online operations of leading grocery
retailers globally.

 

As Ocado Retail continues to grow robustly and approaches full capacity in its
current network, this decision now opens an attractive option to provide Ocado
Retail with extra network capacity over the near term.

 

Tim Steiner, CEO of Ocado Group, said:

 

"With our world-leading technology, Ocado Retail and Morrisons offer amazing
propositions in the UK online grocery market. As Ocado Retail moves towards
full utilisation of existing capacity, this decision enables a helpful option
to provide it with further short-term growth, without an expectation for
additional capex. As Morrisons reduce their operations at Erith and build
their volumes in other parts of the network we are working with them to ensure
seamless continuity of service to their customers and to continue strong
market share growth across the UK market with the Ocado Smart Platform."

 

Rami Baitiéh, CEO of Morrisons, said:

"We have a successful partnership with Ocado and we value their expertise and
their technology highly. As our online business continues to grow we have
decided to process a greater share of our online volume through the Dordon CFC
and with in-store fulfilment - which gives our customers full access to our
unique Market Street offer. Morrisons.com will continue to service every
postcode in England, Wales and Scotland, with no impact to customers."

Expected Financial Impact on Ocado Group

 

Subject to the conclusion of our discussions with Ocado Retail, we expect the
net cash impact to be broadly neutral across FY25 and FY26.

 

Contacts:

 

●    Tim Steiner, Chief Executive Officer on +44 1707 228 000

●    Stephen Daintith, Chief Financial Officer on +44 1707 228 000

●    Nick Coulter, Head of Investor Relations on +44 1707 228 000

●    Jamie Kerr, Head of Communications on +44 1707 228 000

●    Lucy Legh, Headland Consultancy - ocadogroup@headlandconsultancy.com
(mailto:ocadogroup@headlandconsultancy.com)

on +44 (0) 20 3805 4822

 

Notes to Editors

 

About Ocado Group

 

Ocado Group is a UK based technology company trading on the London Stock
Exchange

(Ticker OCDO). It provides end-to-end online grocery fulfilment solutions to
thirteen of the

world's largest grocery retailers and holds a 50% share of Ocado Retail
Limited in the UK in a Joint Venture with Marks & Spencer. Ocado has spent
two decades innovating for grocery online, investing in a wide technology
estate that includes robotics, AI & machine learning, simulation,
forecasting, and edge intelligence.

 

Person responsible for arranging the release of this announcement:

 

Neill Abrams

Group General Counsel and Company Secretary

Ocado Group plc

Buildings One & Two, Trident Place, Mosquito Way,

Hatfield, Hertfordshire AL10 9UL

email: company.secretary@ocado.com

Ocado Group plc LEI: 213800LO8F61YB8MBC74

 

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