Ocado Group Earnings: Solid Performance Across the Board Leads to Higher Profit Guidance

No-moat Ocado Group reported half-year results, with revenue up 12.6% and group adjusted EBITDA of GBP 71.2 million ahead of expectations. Ocado Retail's performance (revenue up 11%) was driven by customer growth of 8.1% to 1,037,000, growth in average orders per week of 9.2% to 428,000, and the average basket value increasing 1.8%, in turn due to 1.5% higher average selling price, with basket sizes remaining stable (44.7 items). Profitability was EBITDA-positive at GBP 20.7 million, with progress expected, driven by efficiencies and operational leverage, toward a mid-single-digit EBITDA margin in the midterm (5% in our model by fiscal 2025).