Ocado shares climb on a rise in basket value
The first-quarter trading statement from Ocado has seen strong volume growth and market share gains for the logistics and delivery business. Volumes grew 8.1% year-on-year, driving Q1 retail revenue growth of 10.6%, to £645.3m.
Importantly, average basket value was up 2.1% giving the company an increase in margins. However, while the online grocery business continues to push ahead the news continues to be overshadowed by two events. First, the falling out with its joint-venture operator Marks & Spencer. At the end of February, Ocado warned it may take legal action against M&S if the retailer does not hand over a final payment for their agreement for online deliveries.
Ocado and M&S signed a deal nearly five years ago for the delivery company to sell the high street retailer's food on the internet. M&S made an upfront payment of more than £560 million and was due to pay £190.7 million based on certain targets being met. However, it claimed that Ocado had not reached those goals. Ocado is also facing a potential shareholder revolt over executive pay after an influential proxy adviser has encouraged investors to vote against the group's new bonus scheme that could see CEO, Tim Steiner, receive as much as £14.8 million.
(AI Video Summary)
Business is booming for Ocado
Ocado, a company that specialises in delivering goods, shared some exciting news. Market volumes grew by 8.1% compared to the previous year, which means more people are using their services. This increase in demand led to a 10.6% rise in retail revenue, reaching an impressive £645 million. On top of that, their online market share grew by 13.5% in just one month, showing that they are gaining popularity among shoppers.
Customer shopping habits statistics
Ocado also shared some interesting statistics about their customers' shopping habits. On average, they receive more orders per week, with an 8.4% increase. This shows that more people are turning to Ocado for their everyday needs. Not only that, but the average amount spent per basket also increased by 2.1%. This means that customers are not only buying more frequently, but they are also spending more each time. It's clear that people are enjoying their experience with Ocado and finding value in their products.
Turbulence on the horizon for Ocado
However, despite these positive updates, the company is facing a potential revolt from its shareholders. A group of influential advisors is urging investors to vote against a new bonus scheme, which would grant the CEO, Tim Steiner, a hefty paycheck of up to £14.8 million. This has sparked concerns among shareholders, and there could be a significant backlash during the upcoming vote. If the revolt is successful, it could have important implications for Ocado's leadership and the direction the company takes in the future.
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