Britain’s Ocado counts cost of fire at flagship warehouse

FILE PHOTO: Part of the Ocado CFC (Customer Fulfilment Centre) is seen in Andover, Britain May 1, 2018. Picture taken May 1, 2018. REUTERS/Peter Nicholls/File Photo

LONDON (Reuters) – British online supermarket and technology group Ocado reported ballooning annual pretax losses and a 27% fall in core earnings, mainly due to a fire which destroyed a hi-tech flagship warehouse in Andover, southern England.

Ocado, whose shares have risen 35% over the last year due to overseas technology deals, said on Tuesday its loss before tax widened to 214.5 million pounds ($276.8 million) in the year to Dec. 1 2019 versus 44.4 million pounds in 2017-18.

The loss reflected exceptional charges of 94.1 million pounds relating to the write-down of the Andover site.

Ocado made earnings before interest, tax, depreciation and amortization (EBITDA) of 43.3 million pounds ($55.9 million), versus a re-stated 59.5 million pounds for 2017-18.

That outcome, which also reflected accounting changes and the costs of share schemes, was broadly in line with analysts’ consensus forecast.

For the 2019-2020 year Ocado forecast retail revenue growth of 10-15% and international technology fees of 40% or more.

It forecast EBITDA from retail above its revenue growth. However, EBITDA from UK solutions & logistics and from international solutions was forecast to decline.

Prior to Tuesday’s update analysts’ average forecast for 2019-20 EBITDA was 33 million pounds.

Reporting by James Davey; editing by Kate Holton

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