Online grocery store Ocado saw shares fall over 3 percent on Thursday, despite a strong increase in gross sales.
Sales at the supermarket rose 13.6 percent over the last 12 months, and 13.1 percent in the last quarter. The average order number also increased by 17.6 percent in their fiscal fourth quarter, with both new and returning customers fuelling demand.
However, investors were unimpressed by the 2.9 percent decrease in average order size, as industry-wide price deflation affected figures. Ocado attributed the fall to their ‘Smart Pass’, which allows customers to save money on both goods and delivery by shopping mroe frequently.
Tim Steiner, Ocado’s Chief Executive Officer, commented:
“We are very pleased with the financial performance achieved this year. The strong growth in sales and order volumes reflects the attractiveness of our retail offer to customers.
“During the period, we were also pleased to announce that we have commenced operations at our Andover CFC. This is the first of our CFCs to use our new proprietary infrastructure equipment solution and software, which will support the ongoing growth of our business.”
Ocado have faced strong competition in 2016, with retail giant Amazon launching a rival service and a change in its agreement with Morrisons reducing its income from the partnership. The supermarket sector as a whole has struggled of late, forced to decrease prices to compete with budget brands such as Lidl and Aldi.
Ocado (LON:OCDO) shares are currently down 3.28 percent at 268.60 (0931GMT).