Shareholders 'don't want us to make a profit,' says Ocado chief after big loss
- Ocado posted a pre tax loss of £12.5million for the year to December 1
- Sales rose 15.2 per cent to £843million during the year, also below forecast
The chief executive of Ocado insisted shareholders ‘don’t want us to make a profit at the moment’ after posting a deeper than expected annual loss.
The online grocer, which has seen its shares soar 390 per cent over the past year following a transformational deal with Morrisons, has defied critics to achieve a £3billion valuation, despite having never made a profit in 14 years of trading.
Boss Tim Steiner, pictured, says instead, investors want him to grow the business into a ‘white-label’ giant, providing a template for international retailers to use online.
Ocado boss Tim Steiner says investors want him to grow the business into a 'white-label' giant
‘We could have made a £40million profit,’ he said. ‘But shareholders prefer we invest in the business so they can make a significant profit in the future – they want billions.’
The retailer, which mainly sells products supplied by Waitrose, struck a £216million partnership with Morrisons during the year to catapult Britain’s fourth largest grocer online.
It is in talks with a number of foreign grocers to secure similar deals and is developing software that would allow them to help multiple partners to launch simultaneously.
Steiner will announce the location for a third warehouse after the second in Dordon, Warwickshire, approaches capacity faster than planned due to the Morrison deal.
Ocado disappoints: The online grocer's big 2013 loss disappointed investors who had been hoping fro a profit
He also said gaffe-prone co-founder Jason Gissing, who previously described Waitrose as a ‘pain in the a**e’ to deal with, plans to leave the firm in July. He will not receive a pay-off.
Ocado (down 13.5p to 510p) saw its loss grow to £12.5million for the 52 weeks to December 1 from £600,000. However operating profit increased to £45.8million from £34.5million and sales grew 17.2 per cent to £843million.
The Morrisons deal contributed £900,000 to profit. The number of customers grew to 385,000 from 355,000 and average spend increased to £113.53 from £112.10.
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