Ocado overtakes rivals amid pressure from shareholders urging the group to leave London for New York
Ocado Group Plc grew faster than Britain’s major supermarkets as the technology and retail company tries to reverse losses that have fueled chatter around a potential stock listing move.
Sales at the British online grocer rose 12.5% in the 12 weeks to April 14 from a year ago, ahead of the total online market growth of 6.8%, according to data published by research firm Kantar on Tuesday.
Ocado is vying to turn its fortunes around following a pretax loss of almost £400 million ($494 million) in 2023 and a more than halving of its stock price since January. That’s putting shareholder pressure on the company to explore moving its London listing to New York, the Telegraph reported, without saying where it got the information.
The latest data highlights how the upmarket grocer’s efforts to compete against discounters through price cuts and special offers is driving some initial success. Discounter Lidl recorded the second best growth, gaining 9.1% in sales compared with last year as shoppers opted for more affordable items.
Lidl and Aldi combined now account for 18% of the UK’s grocery market. Ocado still accounts for less than 2% of the market, despite its sales growth.
Inflation fades
Kantar’s data also revealed another step in the UK’s recovery from an historic cost of living crisis. “This emphasis on offers, coupled with falling prices in some categories like toilet tissues, butter and milk, has helped to bring the rate of grocery inflation down” to 3.2%, said Fraser McKevitt, head of retail and consumer insight at Kantar’s Worldpanel. It means grocery inflation for the four weeks to April 14 dropped to the same level as the UK’s overall consumer prices index, which came in at 3.2% in March.
Tesco cemented its position as Britain’s biggest grocer with a market share of 27.4%, while Sainsbury’s followed at 15.3%.
Asda, however, is struggling to hold on to market share, losing 0.4% from a year ago. The UK’s third largest supermarket chain saw total sales rise 7.1% in 2023, according to a statement Monday, but the company risks losing ground as its seeks cash to ease its high levels of debt.
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