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Highlights:

  • Ocado Group reported H1FY25 revenue of GBP 674 million, up 13.2% year-on-year
  • The company delivered adjusted EBITDA of GBP 91.8 million, led by Technology Solutions margin growth
  • Ocado Retail revenue grew 16.3% with EBITDA rising to GBP 33.3 million following deconsolidation

Ocado Group plc (LSE: OCDO), a UK-based technology-led logistics and e-commerce solutions provider, has announced its results for the first half of the financial year 2025 (H1FY25), reporting higher revenues, expanded margins, and improved cash flow performance across its core business segments. For the six months ended 2 June 2025, group revenue increased by 13.2% year-on-year to GBP 674.0 million. This was driven by growth across both the Technology Solutions division, which recorded revenue of GBP 72.8 million (+14.9% YoY), and Ocado Logistics, which posted GBP 19.0 million in EBITDA (+12.1% YoY). The group’s adjusted EBITDA reached GBP 91.8 million, up from GBP 52.0 million in the prior-year period.

Ocado Retail (ORL), now accounted for as an associated undertaking following its deconsolidation in April 2025, reported a 16.3% revenue increase and an EBITDA contribution of GBP 33.3 million. Ocado retains a 50% economic interest in the venture, which it co-owns with Marks & Spencer Group. The deconsolidation led to a statutory profit of GBP 611.8 million, largely due to a one-off gain of GBP 782.6 million on the fair value adjustment of Ocado’s equity interest in ORL. Cash performance improved during the period. Underlying cash outflow was reduced to GBP 108 million, a GBP 93 million improvement compared to the GBP 201 million outflow reported in H1 FY24. The gains were attributed to higher revenues, increased EBITDA, lower capital expenditure, and cost-control measures, which collectively outweighed elevated finance costs. Ocado ended the period with GBP 1.05 billion in liquidity, including GBP 745.8 million in cash.

Operationally, the company reported 119 live modules at the end of H1FY25 (up from 112 in the prior year), despite the exit of Morrison deliveries from its Erith Customer Fulfilment Centre (CFC). Average live modules rose by 8.9% year-on-year. Weekly volume growth across the CFC network increased by 23%, and several international CFCs were reported to be nearing full design capacity. Ocado’s Re:Imagined rollout and automation investments continued across its global network. Productivity at OSP-powered CFCs increased by 8.1%, with robotic picking accounting for approximately 40% of volumes at the Luton site. In Ocado Logistics, efficiency improvements supported the overall performance, while Ocado Retail showed order growth of 14.7% and a 3.3% adjusted EBITDA margin (excluding Hatfield fees). The full customer transition to Ocado Smart Platform (OSP) was completed during the period.

Looking ahead, Ocado provided guidance for the full year and medium-term. The company expects Technology Solutions to grow revenue by around 10% in FY25, with EBITDA margins between 20% and 25%. Approximately eight new CFCs are expected to go live by FY27, including sites in Warsaw, Charlotte, Phoenix, Hachioji, Busan, Kuki, Gyeonggi, and Barcelona. Ocado Logistics is targeting mid-single digit revenue growth in FY25 and EBITDA of around GBP 30 million. Group capex is expected to total approximately GBP 300 million in FY25, and the company forecasts an underlying cash outflow of around GBP 200 million.

A key strategic priority remains achieving company-wide positive cash flow during FY26, with full-year cash flow positivity expected in FY27. Cost discipline continues to be emphasised, with plans to reduce technology and support expenses following a period of high R&D investment. From FY27, R&D spending is expected to account for around 20% of recurring revenues. CEO Tim Steiner commented that the business had delivered meaningful progress in the first half, with momentum across international markets and technology adoption. He noted that the expiry of certain exclusivity arrangements later this year will allow Ocado to re-engage in commercial discussions with new and existing partners globally.

OCDO is trading at 11.38% higher at GBX 262.30 per share as on 17 July 2025.