nline grocer Ocado stated its retail grocery arm returned to an underlying revenue in current months – however noticed revenues held again as cash-strapped customers reduce their spending.

The group’s retail arm, run as a three way partnership with Marks & Spencer, posted underlying losses of £2.5 million total within the six months to May 28, although Ocado stated it delivered underlying earnings in every month of the second quarter.

It stated there was a “clear pathway” to proceed driving underling earnings on the division.

Retail revenues rose by 5% to £1.2 billion as common worth inflation of 8.4% was offset by smaller basket sizes – down 6.3% at 45 gadgets – and fewer orders per week as customers decreased their spending within the face of hovering value pressures.

Our operations within the UK stay an vital demonstration of the potential for our worldwide ambitions as we search to rework the economics of on-line grocery and broaden into the broader automated storage and retrieval options market

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It insisted its improve in common promoting costs was under the broader UK grocery inflation at 12.8%, in keeping with trade information from Nielsen.

Ocado stated it had begun to see the declines in basket sizes stabilise at 44 gadgets over the second quarter.

Overall throughout the group, which additionally consists of its worldwide logistics and robotic warehouse operation, Ocado reported widening pre-tax losses of £289.5 million within the first half, in opposition to losses of £211.3 million a 12 months in the past, together with one-off prices of closing its Hatfield warehouse.

It stated on an underlying incomes foundation, it swung to a £16.6 million revenue in opposition to losses of £13.6 million a 12 months earlier.

Tim Steiner, Ocado chief government, stated: “In the UK, Ocado Logistics had a steady, profitable first half and Ocado Retail is making good progress, with a return to profitability in the second quarter.

“Our operations in the UK remain an important demonstration of the potential for our international ambitions as we seek to transform the economics of online grocery and expand into the wider automated storage and retrieval solutions market.”