- Two new delivery hubs open in Australia
- Delivery hubs will serve customers in Melbourne and Sydney
- Year-to-date shares are down more than 50%
Shares in Ocado (OCDO) were marginally higher at 364p in morning trading as the online grocery retailer said two (customer fulfilment centres) CFCs in Australia had opened in July (a year later than originally planned).
The joint venture with Coles has now finally begun to serve communities in Melbourne and Sydney, the company says.
The delivery hubs will be powered by cutting edge (artificial intelligence) AI and automation in the (Ocado Smart Platform) OSP which Ocado insists will improve freshness, range and order rates for Coles customers.
Last month the online grocery said it planned to build a third CFC in Kuki-Miyashiro prefecture in Japan which will go live in 2027 and will be developed with hypermarket group AEON (8267:TYO).
'NOT QUITE THE DISASTER EVERYONE THINKS IT IS'
Russ Mould, investment director at AJ Bell said: ‘After client setbacks in the US and Canada, Ocado will be relieved that expansion plans in Australia have proceeded.
‘The rollout of new warehouses with Coles in Australia is exactly the good news Ocado needs, given the volatile nature of its announcements this year. Just as North American partners rethink their plans to boost capacity to support online groceries, Ocado is still making progress in other parts of the world.
‘Going live in Australia and having recently strengthened relationships in Japan means that Ocado is not quite the disaster so many people imply it is.’
DISCLAIMER: Financial services company AJ Bell referenced in this article owns Shares magazine. The author of this article (Sabuhi Gard) owns shares in Ocado and AJ Bell and the editor (Tom Sieber) owns shares in AJ Bell.
