ONLINE grocer Ocado today said it had outperformed market expectations since its controversial stock market flotation after delivering a strong Christmas performance.
The Hatfield-based firm posted gross sales of £50.9 million in the four weeks to December 26, up 26.7% on last year. Sales in the week before Christmas were £12.3 million, up 43.5% on last year.
In a bid to overcome the heavy snowfall and freezing temperatures, the group fitted snow tyres to its 700 delivery vehicles and reduced the number of delivery slots available to ensure orders could be met, which allowed it to meet more than 98% of orders made.
The company was forced to slash the price for its initial public offering in July to 180p - down from initial hopes of 200p and 275p - after retail analysts and fund managers hit out at the firm for overvaluing its business. The share price hit a low of 120p in October before gradually climbing back to today’s price of 184p.
The company said sales increased 27.4% to #178.9 million for the 16 weeks to November 28, its fourth quarter, while average orders per week for the period increased 28% to 99,741.
Chief financial officer Andrew Bracey said Ocado was able to continue this strong performance during the severe weather by "winter-ising" the fleet with snow tyres and by providing extra training to drivers.
The internet retailer, which is yet to make a profit since it launched more than 10 years ago, said it planned to grow the business this year, by expanding its own-label offering, expanding into the south west through a new site in Bristol and building a second distribution centre in the Midlands.
Ocado faces stiff competition in the coming months, as supermarket Morrisons plans to trial an online service, while Amazon recently moved into the grocery sector.
While Ocado has renewed a contract with Waitrose to continue selling its goods until 2020, the supermarket has just started its own competing delivery operation within the M25.
Tim Steiner, Ocado chief executive, said: "We are delighted to see the continued growth in demand for Ocado, a record number of customers shopped with us in this period.
"Our plan for dealing with extreme weather conditions enabled us to make over 98% of deliveries in the affected period."
Andrew Wade, an analyst at brokers Numis, said: "We remain positive on Ocado, highlighting the clear and ongoing shift in grocery shopping towards online."