Ocado Group PLC Annual Financial Report (5851O)
February 10 2016 - 2:00AM
UK Regulatory
TIDMOCDO
RNS Number : 5851O
Ocado Group PLC
10 February 2016
ANNUAL FINANCIAL REPORT
OCADO GROUP PLC
10 February 2016
Ocado Group plc
Annual Financial Report 2015
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 29 November 2015 (as required
by Listing Rules 9.6.1 and 9.6.3).
The annual report and accounts for the 52 weeks ended 29
November 2015 is available to view on Ocado's website:
www.ocadogroup.com (in compliance with Disclosure and Transparency
Rule 6.3.5(3)).
Ocado's annual report and accounts for the 52 weeks ended 29
November 2015 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 on 2 February
2016 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 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 29 November 2015. 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 29 November 2015. 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 14 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 38 to 41 of the annual
report and accounts for the 52 weeks ended 29 November 2015.
Objective Risks Mitigation Action/Control Change During
The Year
============= ================= ================================================================= =================
DRIVING Failure
GROWTH to maintain * Continuation of our LPP basket matching price é
competitive comparison
pricing Due to
position increased
* Maintaining a competitive number of promotional competition
offers and increased availability of free delivery in the market
slots for price sensitive customers
* Creation of a choice of tiered price points within
each category
------------- ----------------- ----------------------------------------------------------------- -----------------
Risk of
decline * Weekly monitoring of the key indicators and the çè
in high underlying drivers against published targets
service
levels
------------- ----------------- ----------------------------------------------------------------- -----------------
Failure
to develop * Growth of the Ocado own label range alongside çè
retail continued provision of the Waitrose range
proposition
to appeal
to broader * Growth of branded ranges and expansion of supplier
customer base
base and
sustain
growth rates * Alternative sourcing scenarios considered in the
event that the Waitrose sourcing relationship
terminates
* Continuation of investment and optimisation of the
marketing channels to acquire new customers
* Continued improvement of webshop and apps
------------- ----------------- ----------------------------------------------------------------- -----------------
Failure
to develop * Second and third overseas technology centres opened çè
sufficient
management
and technology * Improved IT prioritisation process
capability
or bandwidth
to deliver
on all our
strategic
priorities
------------- ----------------- ----------------------------------------------------------------- -----------------
Risk of
not signing * Investment in our platform which enables OSP is also n
multiple required for Ocado's expanding retail business.
OSP deals Initial deployment will be in CFC Andover and CFC
in the medium Erith
term
* Impact of not signing multiple OSP deals in the
medium term is restricted to the lost opportunity to
increase our earnings from our Platform business
* 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 the
development
============= ================= ================================================================= =================
MAXIMISING A risk of
EFFICIENCY delays in * Dedication of resources to the modularisation of é
the technology and logistics systems to enable faster
implementation replication Future new
of new capacity capacity
for both is reliant
Ocado and * New capacity in development at CFC Andover and CFC on new,
Morrisons Erith unproven
technology
* Regular Executive Board steering and full Board
reporting of new technology projects
============= ================= ================================================================= =================
UTILISING Technological
PROPRIETARY innovation * Engagement with a wide number of international çè
KNOWLEDGE supersedes grocers to understand market needs
our own
and offers
improved * Experienced teams in place who understand the current
methods solutions and are aware of the global alternatives
of food used in other industries
distribution
to consumers
* Processes to identify patentable inventions and to ê
apply for patents Multiple
Failure patents now
to protect filed although
our IP * Established Ocado Innovation Committee to review our the value
patent portfolio and discuss other IP issues of IP has
increased,
so increasing
the value
to others
* Conducting "freedom to operate" searches on selected
technologies
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