Ocado Group Earnings: Good Progress in 2023, Steady Improvement Across the Board in Fiscal-Year 2024

Ocado Group reported fiscal 2023 results, with group revenue up 9.9% and group EBITDA of GBP 51.6 million broadly in line with expectations. Ocado Retail's good performance (revenue up 7%) was driven by: 1) good customer growth of 5.9% to 998,000; 2) growth in average orders per week of 4% to 393,000; and 3) the average basket value increasing 2.7%—in turn due to 7.9% higher average selling price, offset by smaller basket sizes (down 4.5% to 44 items). Segment profitability was EBITDA-positive at GBP 10 million with progress expected driven by efficiencies and operational leverage toward a mid-single-digit EBITDA margin in the midterm (5% in our model by fiscal 2025).