Investors shun Ocado as sales growth slows

More than 10 per cent was wiped off the market capitalisation of Ocado, the online grocer, yesterday, after it warned on lower profit margins and its quarterly sales growth slowed.

Ocado, which delivers Waitrose groceries, also continued to suffer from "capacity constraints" in its third quarter, as its huge distribution warehouse in Hertfordshire's Hatfield struggles to keep up with strong demand.

However, Andrew Bracey, the finance director

of Ocado, said it had already addressed "some" of these constraints.

Jonathan Pritchard, the analyst at Oriel Securities, said: "We believe that the business model here is coming under increasing pressure."