Jan 29 (Reuters) - Ocado, the British technology and online grocery group, said on Thursday its Canadian supermarket partner Sobeys has decided to close its robotic warehouse in Calgary, dealing
Ocado Faces Setback as Canadian Partner Closes Calgary Warehouse
Impact of Sobeys' Warehouse Closure
Jan 29 (Reuters) - Ocado, the British technology and online grocery group, said on Thursday its Canadian supermarket partner Sobeys has decided to close its robotic warehouse in Calgary, dealing another blow to the Ocado business model.
Details of the Closure
The planned closure of the Calgary customer fulfilment centre (CFC) was blamed on the Alberta grocery e-commerce market's size and the rate of expansion being slower than originally anticipated.
Financial Implications for Ocado
It follows last year's move by U.S. grocer Kroger, Ocado's biggest partner, to close three automated warehouses, which sent Ocado's shares down 17%.
Future of Other CFCs
Ocado said Sobeys two CFCs in the Greater Toronto and Montreal areas will remain open. A planned CFC in the Vancouver area remains "paused".
Ocado expects to receive compensation during its current financial year of 18 million pounds ($25 million) for the closure of the Calgary CFC.
It expects the closure to reduce fee revenue by 7 million pounds in its 2025/26 year.
($1 = 0.7224 pounds)
(Reporting by Ankita Bora in Bengaluru and James Davey in London; Editing by Rashmi Aich and Sarah Young)
