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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Ocado Group Plc | LSE:OCDO | London | Ordinary Share | GB00B3MBS747 | ORD 2P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| -6.50 | -1.79% | 357.40 | 357.20 | 357.70 | 365.60 | 355.00 | 356.50 | 3,415,063 | 13:19:05 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Misc Retail Stores, Nec | 2.83B | -314M | -0.3838 | -9.35 | 2.94B |
From Apr 2019 to Apr 2024
TIDMOCDO
RNS Number : 6549C
Ocado Group PLC
11 February 2020
ANNUAL FINANCIAL REPORT
OCADO GROUP PLC
11 February 2020
Ocado Group plc
Annual Financial Report 2019
Ocado Group plc ("Ocado") has today submitted to the Financial Conduct Authority's national storage mechanism its annual report and accounts for the 52 weeks ended 1 December 2019 (as required by Listing Rules 9.6.1 and 9.6.3).
The annual report and accounts for the 52 weeks ended 1 December 2019 is available to view on Ocado's website: www.ocadogroup.com (in compliance with Disclosure Guidance and Transparency Rule 6.3.5(3)).
Ocado's annual report and accounts for the 52 weeks ended 1 December 2019 will also be available for viewing at the Financial Conduct Authority's national storage mechanism at www.morningstar.co.uk/uk/NSM.
This announcement follows Ocado's announcement today of its preliminary results for the same period. A condensed set of Ocado's financial statements and information on important events that have occurred during the year and their impact on the financial statements and related party information were included in Ocado's preliminary results announcement. That information together with the information set out below is the information provided in satisfaction of the requirements of Disclosure Guidance and Transparency Rule 6.3.5. The description of principal risks and uncertainties below is extracted in unedited full text from the annual report and accounts for the 52 weeks ended 1 December 2019. Reading this announcement and/or the preliminary results announcement should not be a substitute for reading the full annual report and accounts for the 52 weeks ended 1 December 2019. This announcement and the preliminary results announcement are available to view on Ocado's website: www.ocadogroup.com.
Principal risks and uncertainties
We have identified 13 principal risks and uncertainties facing Ocado. These are considered by the Board to be material to the development, performance, position or future prospects of Ocado. These risks, mitigations and changes during the year are summarised in the table below. They are not set out in priority order. Further information on risk is set out on pages 48 to 52 of the annual report and accounts for the 52 weeks ended 1 December 2019.
Hot Features
Premium
Objective Risks Mitigation Action/Control Change During
The Year
================= ================= ============================================================ ==================
IMPROVING Risk of decline çè
THE PROPOSITION in high service * Weekly monitoring of the key indicators and the
levels in underlying driver targets.
the retail
business
especially * Continuing initiatives to improve resiliency and
during the operational performance of the Hatfield and Dordon
transitional CFCs.
period of
change
associated * Along with the scaling of operations at Erith, these
with the arrangements help reduce the impact of operational
creation problems in CFCs on customer service levels.
of the Ocado
Retail joint
venture
----------------- ----------------- ------------------------------------------------------------ ------------------
Failure to çè
maintain a * Continuation of Low Price Promise basket matching
retail price comparison and competitive pricing.
proposition
which appeals
to a broad * Development of appropriate M&S own-label range.
customer base
and sustains
growth rates * Growth of branded ranges and expansion of supplier
while managing base.
changes
resulting
from our new * Continuation of investment and optimisation of the
arrangements marketing channels to acquire new customers.
with M&S
* Continued improvement of webshop and apps.
* Planned roll-out of further immediacy sites.
----------------- ----------------- ------------------------------------------------------------ ------------------
Risk that çè
current * Full review of projected financial impact undertaken
Solutions before signing any new partnerships.
pricing levels
may not provide
both acceptable * Periodic review of delivery costs and close
returns for relationship with our partners provides oversight of
our shareholders project costs.
and attractive
long- term
cost of * Regular review of IT prioritisation process and rate
ownership of software development and regular platform steering
for our meetings.
clients, while
delivering
a viable fully * Resources and capabilities will be scaled and
operational reallocated to help meet Ocado Solutions project
end-to-end deadlines.
customer
experience
* There is an ongoing programme of design improvements
for the platform.
* The amount of capital invested in our platform is
carefully controlled and we have the ability to
reduce costs by scaling back the speed of future
development.
----------------- ----------------- ------------------------------------------------------------ ------------------
MAXIMISING Risk of the é
EFFICIENCY transformation * Creation of a Group Transformation team who are The risk has
programme supporting the business in the design and increased
failing to implementation of the new operating model which during the
deliver a includes people, process and systems. period with
sustainable the successful
operational signing
infrastructure * Increased hiring of key skills in the UK and of further
able to execute internationally, including greater emphasis on international
effectively graduate recruitment and training programmes. deals
the requirements
for multiple
Ocado Solutions * Standardisation of platform delivery to improve
contracts, repeatability.
simultaneously
in many
international
locations,
while providing
for sufficient
management,
technology
and engineering
capabilities(1)
----------------- ----------------- ------------------------------------------------------------ ------------------
Risk of delays ê
in the * Dedicated resources continue to work on modularising The risk has
generation technology to enable faster replication and reduced decreased
of additional build times. during the
capacity in period with
the UK the announcement
* New capacity increasing as Erith (CFC4) ramps up with of further
plans to build CFC5 (Purfleet) and CFC6 (Bristol). CFCs
CFC3 (Andover) is being rebuilt.
* Regular steering meetings and management oversight
for new CFC projects.
----------------- ----------------- ------------------------------------------------------------ ------------------
UTILISING Technological çè
KNOWLEDGE innovation * Establishing our identity as a technology business,
supersedes international platform provider and innovation
our own and factory.
offers improved
methods of
food * Engagement with a wide number of international
distribution grocers to understand market needs.
to consumers
* Experienced teams in place who understand the current
solutions and are aware of global alternatives used
in other industries.
----------------- ----------------- ------------------------------------------------------------ ------------------
Risk of çè
infringing * Conducting "freedom to operate" searches on selected
a third party's technologies in selected jurisdictions and monitoring
IP or failing IP filings by a large number of companies.
to protect
Ocado's own
IP(2) * Where appropriate, obtaining specialist or legal
advice including to help ensure our ability to use
our IP is not restricted by infringement claims.
* Ongoing effort to identify patentable inventions and
to apply for patents, with an increased number of
patent applications. Expansion of IP team to help
with IP protection work.
* Ongoing review of our patent portfolio and discussion
of other IP issues by the Ocado Innovation Committee.
* Where necessary we take steps to protect our IP from
unauthorised use.
----------------- ----------------- ------------------------------------------------------------ ------------------
OPERATIONAL Risk of supply n
chain * Setting up of a "Central Manufacturing Fund" governed
disruption, by Supply Chain with a view to ensuring reliable
in particular supply of components.
for single
source
equipment, * Agile approach to manufactured products including the
that adversely ability to divert any product to sites with the most
affects product pressing requirements.
availability,
delivery,
reliability
and cost,
resulting
in delays
to contractual
commitments
and loss of
revenue(3)
----------------- ----------------- ------------------------------------------------------------ ------------------
Risk of a çè
food safety, * Experienced legal, food and product technology
product safety professionals and health and safety experts monitor
or health compliance against policies and procedures.
& safety
incident(4)
* Supplier approval and certification process.
* Food and product safety policies and quality
management with operational procedures.
* Risk assessments and safe systems of work prepared by
qualified staff to raise awareness and knowledge.
* Active monitoring of international regulatory changes
supported by territory expertise and recognised
safety management system standards.
----------------- ----------------- ------------------------------------------------------------ ------------------
Risk of changes çè
in regulations * Regular monitoring of regulatory developments to
impacting ensure that changes are identified.
our business
model or the
viability * Due diligence carried out at appropriate stages in
of Ocado the Ocado Solutions process.
Solutions'
deals.
----------------- ----------------- ------------------------------------------------------------ ------------------
Risk of negative çè
implications * Engagement with regulators and monitoring by
due to changes management and specialist teams of the global and
in the global economic environment and regulatory changes to access
economic and the potential impacts on hiring employees, trading,
geopolitical operations or the business model.
environment,
including
Brexit and
the associated
tariffs or
difficulty
in hiring
employees,
that may impact
our business
model(5)
----------------- ----------------- ------------------------------------------------------------ ------------------
Failure to çè
prevent or * IT systems are structured to operate reliably and
respond to securely. The security of our IT systems is regularly
a major cyber tested by third parties.
attack or
data breach
that could * An information security and PCI security governance
result in programme overseen by the Information Security
business Committee.
disruption,
reputational
damage, * A dedicated Information Security team to monitor for
significant security issues and respond to security incidents.
fines or the
loss of
customer, * No customer payment card data is held in Ocado's
employee or databases.
confidential
business
information * Data Protection Officer oversees the Group's privacy
compliance programme.
----------------- ----------------- ------------------------------------------------------------ ------------------
Risk of business çè
interruption * IT systems are structured to operate reliably and
securely.
* Dedicated engineering teams on site with daily
maintenance programmes to support the continued
operation of equipment.
* Ongoing testing and research and development to make
equipment and MHE more reliable and robust.
* Disaster recovery testing and business continuity
plans continue to be progressed and updated.
* High level of protection for CFCs and equipment,
combined with business interruption insurance to
transfer residual risks.
================= ================= ============================================================ ==================
(1) The risk covering the execution of multiple international contracts and the requirement for resources has been amended to reflect the importance of the transformation programme.
(2) The risks described in the 2018 annual report as "Risk of infringing a third party's IP" and "Risk of failing to protect Ocado's own IP" have been combined.
(3) A new risk covering supply chain disruption has been added to reflect the increased significance of the Ocado Solutions programme.
(4) The risk described in the 2018 annual report as "Risk of a food safety or product safety incident" has been expanded to include health & safety incidents.
(5) The risk described in the 2018 annual report as "Risk of negative implications caused by final Brexit terms such as increase in import costs or difficulty in hiring employees" has been expanded to reflect the global economic and geopolitical environment resulting from Ocado's increased international reach.
Key: é Risk has increased ê Risk has decreased çè No change n Not applicable
For further information on the financial risks see pages 192 to 194 of the notes to the consolidated financial statements in the annual report and accounts for the 52 weeks ended 1 December 2019.
Directors' Responsibility Statement
Ocado's annual report and accounts for the 52 weeks ended 1 December 2019 contains the following statements regarding responsibility for the financial statements and the annual report in compliance with DTR 4.1.12. This responsibility statement is repeated here (below) solely for the purposes of complying with Disclosure Guidance and Transparency Rule 6.3.5. It is not connected to the extracted information presented in the preliminary results announcement or this announcement.
Each of the Directors who held office at the date of the approval of this Annual Report (whose names and functions are listed on page 70 of this Annual Report) confirms, to the best of his or her knowledge, that:
-- the Group financial statements, which have been prepared in accordance with IFRSs as adopted by the EU, give a true and fair view of the assets, liabilities, financial position and profit or loss of the Group; and
-- the "Management Report" (as defined in the Directors' Report on page 132) includes a fair review of the development and performance of the business and the position of the Group, together with a description of the principal risks and uncertainties that it faces.
The Directors of Ocado Group plc are listed on page 70 of the annual report and accounts for the 52 weeks ended 1 December 2019 and are listed on the Ocado Group's corporate website: www.ocadogroup.com. The Directors of Ocado Group plc as at the date of this announcement are as follows:
Lord Stuart Rose;
Tim Steiner;
Neill Abrams;
Duncan Tatton-Brown;
Mark Richardson;
Luke Jensen;
Jörn Rausing;
Andrew Harrison;
Emma Lloyd;
Julie Southern;
John Martin; and
Claudia Arney
Enquiries
For further information contact:
Ocado Group plc Investor Relations
Company Secretary David Shriver
Neill Abrams +44 1707 228 000
email: company.secretary@ocadogroup.com investor.relations@ocado.com
Person responsible for arranging the release of this announcement:
Neill Abrams
Company Secretary
Ocado Group plc
Buildings One & Two
Trident Place
Mosquito Way
Hatfield
Hertfordshire AL10 9UL
Fax: +44 (0)1707 227 997
email: company.secretary@ocadogroup.com
Ocado Group plc LEI: 213800LO8F61YB8MBC74
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.
END
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February 11, 2020 08:30 ET (13:30 GMT)
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