Ocado reports rise in third quarter sales

Ocado said it made gross sales of 126.5m in the 12 weeks to August 8.

Growth was in line with the rate achieved in the first half of its financial year and gross profit margins remained at a similar level to that period, the company said.

However Ocado, which sells the products of upmarket grocer Waitrose, has yet to make a pre-tax profit, and analysts are split over whether its model of distributing from a central depot will ever be as cost-effective as filling online orders from local stores, as rival supermarkets do.

The group also faces growing competition, with Waitrose stepping up its own online service and analysts suggesting Bradford-based Wm Morrison Supermarkets may unveil a plan to move online in a strategy update on Thursday.

Founded by three former Goldman Sachs bankers in 2000, Ocado raised 200m from selling new shares in July to fund its expansion. It said on Thursday talks to build a second depot were progressing.