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
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