Ocado sales surged by 40 per cent over last two months thanks to coronavirus stockpilers and say online grocery shopping will continue to grow when crisis ends
- The company said it has ramped up its capacity ‘significantly’ to meet demand
- It expects a long-term shift towards grocery shopping post-crisis
- Shareholders are expected to protest over a £58.7 million pay packet awarded to Chief Executive Tim Steiner
- Here’s how to help people impacted by Covid-19
Online supermarket Ocado said retail revenues surged by 40.4 percent over the past two months as demand soared due to the coronavirus pandemic.
The company said it expects ‘the long-term shift towards online grocery to accelerate post-crisis.’
The update came ahead of Ocado’s annual general meeting, where shareholders are expected to protest over the £58.7 million pay packet Chief Executive Tim Steiner received for 2019.
The company said it ramped up its capacity ‘significantly’ in order to support the rise in demand, running its warehouses close to their peak capacity and highest efficiency.
Steiner, 50, pictured with his girlfriend, lingerie model Patrycja Pyka, 30, was awarded a £58million bonus for his work with Ocado despite the company posting losses of £214million
Ocado said grocery demand increased significantly ‘almost overnight’ at the start of the outbreak.
It said it adapted its platform rapidly in order to meet the record demand and is now delivering significantly more groceries to households than ever before.
However, it said ‘more normal shopping patterns have returned’ in recent weeks.
The online grocer said its current priority is operating its retail business safely and therefore has introduced contact-free deliveries, temperature monitoring for staff, and now regular testing of frontline workers.
It said it expects online grocery shopping to accelerate post-crisis’ but said it is unable to provide guidance for its outlook for the rest of the year due to the uncertainty caused by the pandemic.
Mr Steiner said: ‘We are facing quite a different challenge to many, as we scale up Ocado.com to play its part in feeding the nation, and as we help our clients launch and roll out their online businesses more rapidly against a backdrop of a likely long-term increase in demand for online.
‘Ocado remains in a strong position and, while we should be grateful that our current challenges are around growth, expansion and increased demand, we have great empathy for all who are facing different challenges at this time.
The company said it expects ‘the long-term shift towards online grocery to accelerate post-crisis’
‘In retail, we are working with our small suppliers to make sure we pay them earlier than normal and we will work closely with any who are struggling.’
Mr Steiner bagged the £58.7million bonus back in February.
His pay-out is one of the largest ever to a British chief executive, falling just below the £70million paid to advertising mogul Sir Martin Sorrell in 2015.
Under his leadership, Ocado shares had risen more than five-fold since late 2017. A saver who invested £1,000 in Ocado in December 2017 would now have £5,255.
Earlier this week, the value of Mr Steiner’s shareholding in Ocado had increased to close to £296million.
Mr Steiner’s eye-watering pay packet came as the company’s losses ballooned from £44million to £214million, which it blamed in part on a fire at its warehouse in Andover last year.
Responding to news of his bonus earlier this year, his former wife, Belinda Cohen insisted she had no regrets over the divorce from the 50-year-old food delivery chief executive after he was awarded the huge bonus.
Speaking to MailOnline at her £3.5million north London home, Belinda, 48, said: ‘Congratulations to him. I’m delighted. It’s a fantastic amount of money. Good luck to him.
She added: ‘I don’t have any regrets. I just wish him lots of luck in the future.’
Belinda wed the city high-flier in 1999, the year before he founded Ocado, but their marriage floundered in 2016 and Mr Steiner is now dating glamorous Polish model Patrycja Pyka, 30.
The end of their marriage led to an acrimonious court battle with the father-of-four dividing his £116 million fortune with Belinda.
Ocado’s successes are likely to continue as M&S are due to deliver their full range through the online supermarket from September.
M&S will pay Ocado £750million for a 50% share of the new venture, when Ocado’s deal to supply Waitrose products expires.
M&S have launched on Deliveroo and will deliver 130 store favourites to customers’s doors in 30 minutes amid coronavirus lockdown. The store will deliver its full range through Ocado from September
The £600million cash call on its shareholders will bring its ready meals and other food hall items in a £1.5billion deal with Ocado.
But analysts have raised concerns that M&S overpaid for the Ocado deal.
Ocado announced last year that it had cut ties with Waitrose after 19 years – to sign with the middle-class favourite’s arch-rivals Marks & Spencer.
Many shoppers are not pleased that Ocado’s deal will change amid coronavirus concerns and uncertainty.
Waitrose will refocus its online efforts into Waitrose.com after the deal loss with Ocado.
In the meantime M&S have expended their Deliveroo range and will deliver store favourites to customers’ doors in 30 minutes amid the coronavirus lockdown.
The upmarket grocer had a trial partnership with Deliveroo and after its success, have made more than 130 M&S food, beverage and household items available across the country.
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