ocado group plc
annual report and accounts 2011
stock code ocdo
growing sales increasing capacity 
supporting future growth welcome to 
ocado group plc
established in 2000 and listed on the lse’s main 
market in july 2010 ocado is the uk’s largest 
dedicated online grocery retailer providing an 
innovative market leading customer experience
ocado value ocado service
ocado choice ocado way
we use inspired thinking and 
cuttingedge technology to keep 
honing our uniquely efficient 
delivery model  this helps us to 
drive down prices and guarantee 
exceptional value for money
we have a passion for delivering 
quality groceries in perfect condition 
and on time while treating our 
customers with care and honesty  
this helps us to share our vision of 
a different way of shopping a better 
greener and more convenient one
we love what we do and are 
proud of all the wonderful groceries 
that we sell  this drives us on to 
offer the widest choice imaginable 
and ensures everything we sell is 
always of the highest quality
we care passionately about our 
environment  this spurs us on to 
provide a greener more sustainable 
alternative to oldfashioned 
storebased supermarket chains
see further information online 
wwwocadogroupcom 01 stock code ocdo wwwocadogroupcom
governance about oc ado our responsibilities our financials our performance
2106604 08022012 proof 1
contents  
 
operational and financial performance 
in 2011 and pr ospects for 2012
an overview of the company including 
our strategy
02 highlights
03 chairman’s letter
04 chief executive officer’s review
08 chief financial officer’s review
10 marketplace
12 driving the online proposition
14 strategy
16 questions and answers
our performance about oc ado
information regarding the bo ard and ho w 
they have run the business for the benefit 
of the shareholders
detailed analysis of financial position and 
performance
18 principal risks and uncertainties
24 corporate social responsibility report
28 board of directors
30 statement of corporate governance 
46 directors’ remuneration report
56 directors’ report
66 independent auditors’ report
67 consolidated income statement
68 consolidated statement of comprehensive income
69 consolidated balance sheet
70 consolidated statement of cash flows
71 consolidated statement of changes in equity
72 notes to the consolidated financial statements
115 independent auditors’ report
116 company balance sheet
117 company statement of cash flows
118 company statement of changes in equity
119 notes to the company financial statements
137 glossary
139 company information
our responsibilities our financials 02
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
highlights
 
  
highlights
gross sales
2011 2010
£551m
2009
£427m
£643m
£643m
2010 £551m
2011 2010
£220m
2009
£92m
£279m
ebitda
£279m
2010 £220m
net assets
2011 2010
£172m
2009
£32m
£173m
£173m
2010 £172m
active customers
2011 2010
262k
2009
220k
298k
298000
2010 262000
financial highlights
 z gross sales
1
 up 166 to £6428 million
 z revenue up 160 to £5983 million
 z ebitda
2
 up 266 to £279 million
 z ebitda
3
 margin up to 47
 z operating profit of £11 million
 z net debt of £192 million
 z cash and cash equivalents £921 million
 
operational highlights
 z a verage orders per week up by 186 
to 110219
 z items delivered exactly as ordered 983
 z deliveries on time or early 923 
strategic highlights
 z cfc1 capacity expansion work making good progress
 z cfc2 building services and ancillary 
infrastructure substantially complete
 z significant initiatives in customer offer including
 z roll out of ownlabel 
 z ocado saving pass
 z ‘shop in shop’ development
 z roll out of latest w ebshop 
 z additional mobile platforms
1
 gross sales include revenue plus vat and marketing  
 vouchers
2
 ebitda is a nongaap measure which we define as  
 earnings before net finance cost taxation depreciation  
 amortisation impairment and exceptional items
3
 ebitda margin is calculated on revenue 03 stock code ocdo wwwocadogroupcom
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2106604 08022012 proof 1
chairman’s letter  
  chairman’s letter
dear shareholder
overview
w e are now in our second year as a public listed company 
and i am pleased to report that the business continues to 
see significant sales growth and improvements in operational 
profitability
during the year the group invested heavily and continues to 
do so in the development of its second customer fulfilment 
centre at dordon w arwickshire  this major development will 
ensure ocado is in a prime position to take full advantage of the 
rapid growth expected in the online grocery business over the 
coming years  
people
i am greatly inspired and hugely impressed by the level of 
service and quality of offering that our people deliver  ocado’s 
impressive record in achieving awards for innovation and quality 
of service continued during the year and is testament to the 
efforts and talent of our workforce  i wish to thank all members 
of the ocado family for their continued support
board changes
andrew bracey has resigned as chief financial officer from the 
board and a process is underway to find a new chief financial 
officer  andrew is expected to leave after the publication of this 
annual report david young who joined the board in 2000 has 
also expressed his intention to resign as nonexecutive director 
at the agm  i would like to pay thanks to andrew and david 
for their valuable contribution to the success of ocado and wish 
them every success for the future  
w e welcomed mark richardson to the board in the newly 
created role of operations director  since 2001 as head 
of technology mark had led the ocado technology team in 
developing our website mobile applications and warehouse it 
system
existing board members jason gissing and neill abrams also 
had changes to their roles during the period  jason has taken on 
the new board position of commercial director and neill has 
assumed responsibility for human resources in addition to his 
current role as legal and business affairs director
w e also welcomed three new nonexecutive directors onto 
the board in douglas mccallum w endy becker and alex 
mahon  douglas’ highlevel experience in ecommerce and it   
w endy’s wealth of experience in retail technology and customer 
service and alex’s experience in media strategy and corporate 
development will complement the skill set of the existing board  
w endy will chair the remuneration committee upon the 
retirement of david young 
corporate governance 
the board has a wide range of responsibilities  there are three 
that are particularly important for the success of the business 
first to debate determine and oversee the execution of our 
strategy second to ensure that we have the most talented 
team to execute this strategy and that we plan effectively for 
succession and third to ensure effective governance
securing the right balance of skills experience and perspectives 
on the board is a key responsibility to ensure that the board 
works effectively as a team towards shared goals with the right 
mix of enquiry and support of the executive directors from the 
nonexecutive directors  the nomination committee report 
on pages 36 to 37 describes this work  w e always seek to run 
our business in a responsible way and we have a very strong 
team which is mindful of its responsibilities not just in helping to 
deliver the strategy but also in overseeing financial controls and 
risk management
our governance reporting obligations are set out in the uk 
corporate governance code  the appointment of the three 
new nonexecutive directors moves the board closer to the 
board’s desired full compliance with the 2010 code in respect 
of board independence  a detailed statement of corporate 
governance can be found on pages 30 to 45 of this annual 
report  
i am also mindful of my responsibility as chairman to lead the 
board and ensure that it is working effectively  this year a board 
evaluation was carried out with the frc’s guidance on board 
effectiveness in mind  i am encouraged as reinforced by our 
board’s performance review that our board operates effectively 
and is properly engaged 
corporate social responsibility
operating our business in a responsible way is fundamental both 
to the way we operate and to delivering sustainable profits and 
longterm value for our shareholders
w e have continued to explore methods of reducing our impact 
on the environment including the use of anaerobic digestion to 
produce electricity from our food waste use of electric vans in 
our london spokes and continuing our closedloop carrier bag 
recycling system  w e have also supported the japan appeal and 
macmillan cancer support among other important causes  the 
corporate social responsibility report found on pages 24 to 27 
describes our responsibilities here 
looking forward
i am excited about ocado’s future and i look forward to the 
continued expansion of our business  as a board we remain 
confident that our strategy and business plan will allow ocado 
to grow and deliver our commitment to create value for our 
shareholders
lord grade of yarmouth
chairman 
ocado group plc
lord grade of yarmouth
chairman 04
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
chief executive officer’s review 
  
chief executive officer’s review
during the past year ocado has made significant progress in 
growing sales and increasing capacity to support future growth  
against the background of the weak uk economy gross sales 
have grown by 166  w e are very grateful to our customers 
for their loyalty and support
market development
the importance of the online grocery market in the uk while 
still in its infancy is now recognised by most major grocery 
retailers  customers continue to migrate from shopping in 
stores for groceries to shopping online  this is borne out by 
average orders per week at ocado in 2011 increasing by 186 
from 92916 to 110219  a recent report from the institute 
of grocery distribution forecast that the uk online grocery 
market will reach £11 billion of sales by 2016  w e believe the 
biggest threat to the growth of the online market is under
investment retailers will not be able to fully service increasing 
customer demand unless they invest in online sales capacity
competition in the online grocery sector is already as strong 
as the traditional storebased sector and will almost certainly 
increase  w e believe the best way for ocado to acquire new 
customers as well as retain existing customers is to continue 
to develop and improve the ocado offer  w e have worked to 
improve this on many levels for the benefit of our customers
capacity expansion
this year we developed cfc1 towards its ultimate capacity 
of 180000 orders per week  investment was made in major 
upgrades to our proprietary software running the warehouse 
operation in additional storage picking and tote conveyor 
capacity and in the power infrastructure of cfc1  in 2012 we 
are planning further investment in cfc1 to take capacity to 
around 160000 orders per week by year end
as i have said in previous updates on the business increasing 
the capacity of cfc1 to cope with increased sales demand 
has presented operational challenges  during the year several 
major construction projects were completed in cfc1 while 
the picking of groceries continued  that we were able to 
do this is a credit to the planning and execution skills of our 
engineering and cfc1 teams  w e temporarily reduced our 
product range to under 20000 lines during the year to create 
space for construction of additional automation  in h2 2011 we 
hired additional temporary staff and reintroduced some manual 
trolleypicking to provide a shortterm increase in operational 
capacity  as a result of these changes cfc1 efficiency measured 
in units per hour “uph” dropped by 82 from 121 uph to 
111 uph  as new equipment becomes operational in cfc1 
over the next 12 months we expect to see a rise in efficiency 
towards our longterm target of 180 uph
“against the backdrop of a weak uk economy we  
have continued to see material growth in the online  
grocery market  w e believe this is evidence of a 
structural shift in consumer behaviour we expect 
continued expansion of this market in the future”
tim steiner chief executive officer
fac t
over 30000 litres of milk 
are delivered daily t o our 
hatfield cfc for next day 
delivery t o our cust omers
oxford
southampton
manchester
leeds
dartford
coventry
w eybridge
bristol
cfc1 hatfield
cfc2 dordon
ocado’s marketplace
coverage o ver 70 of uk 
households and gr owing
spokes
cfcs
wimbledon
white city 05 stock code ocdo wwwocadogroupcom
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2106604 08022012 proof 1
chief executive officer’s review  
 
construction is advancing well at cfc2 in dordon 
w arwickshire  w ork on the building services and ancillary 
infrastructure is substantially complete and equipment 
installation has started  it remains on budget and on time to 
open in q1 2013  systems testing is currently planned to start 
in mid2012 with initial operations scheduled to commence 
in early 2013 giving us a six month testing and commissioning 
window  w e believe cfc2 will represent the single biggest 
increase in capacity by a grocery retailer serving the online 
market in the uk  it is a key part of our drive to secure 
ocado’s leading position in this fast growing market
customer demand
more customers are shopping online and doing so more 
frequently  this is causing a slight decline in basket size and we 
have seen the average order size at ocado during the year 
fall by 17 from £11406 to £11215  most of this decrease 
is due to the shift of customers towards the ocado delivery 
pass “odp” one of our key customer loyalty schemes  there 
are two reasons for this the majority of ocado orders are 
now placed using the odp scheme and these customers 
have a higher overall spend as increased shopping frequency 
more than offsets the lower average basket for this customer 
group  nevertheless it is also clear that ocado customers are 
feeling the same budgetary pressures that are affecting british 
consumers elsewhere and towards the end of 2011 we began 
to see a slight change in product mix and baskets that were on 
average one item smaller
operating efficiency
our delivery network’s performance continued to improve 
throughout the year  w e opened new spokes in bristol and 
wimbledon and after the period end in oxfordshire  the 
bristol spoke has enabled us to expand our service coverage 
into the south w est of england and south w ales  whilst we 
already operate in wimbledon this new spoke increased our 
capacity in the london area by around 17000 orders per 
week  the opening of these spokes increased the operational 
efficiency of our existing delivery network
the increasing scale of the business combined with 
ongoing upgrades to routing software and van design have 
contributed to deliveries per van per week “dpvweek” 
increasing by 87 to 145 dpvweek  during the year the 
peak was 165 dpvweek  the ontime delivery performance 
was 923 down from 949 in the previous year largely due 
to the impact of significant development works in cfc1
grocery range
w e have continued to develop our grocery range and 
ocado now offers a grocery range equivalent in size to our 
largest storebased competitors  our investment in cfc1 
will enable us to grow this from the level of around 20000 
products we had at year end to over 30000 products over 
the next year  the ocado ownlabel range has more than 
doubled during the year to 620 products  our ownlabel 
range is comparable in price and quality to similar products of 
our major competitors and has proved very popular 70 of 
all ocado baskets now contain at least one ocado ownlabel 
product  in addition we have a growing number of specialist 
ranges such as carrefour’s “reflets de france” range of 
authentic french produce as well as leading organic suppliers 
such as daylesford organic and laverstoke p ark farm
nonfood business 
in line with the objectives we set out at our ipo we continue to 
expand our range of nonfood items  w e recruited a dedicated 
nonfood team to drive this expansion forward  w e plan to 
increase significantly our nonfood range by the end of 2013
delivery productivity 
drops per van per week
133
2009
121
145
2008
106
longterm target
2010 2011
175 06
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
chief executive officer’s review 
  
chief executive officer’s review continued
value
w e continue to focus on offering greater value to an ever 
widening customer base  w e have done this by investing in 
price in four main ways increasing the number of products on 
promotion continuing our t esco price match on all identical 
products not on promotion to approximately 7000 products 
by the end of 2011 expanding the ocado own label range 
and launching the ocado saving pass  the ocado saving 
pass enables our customers to make at least a 10 saving on 
over 600 leading branded products  this includes products 
that are already pricematched to t esco in return for a small 
annual fee  all these initiatives were achieved while delivering 
the freshest produce to customers through our shorter 
supply chain accompanied by our product life guarantee
t echnology and innovation –  
website and mobile interfaces
the launch of ocado’s latest w ebshop was completed in 
q1 2011  it has proved to be very successful receiving 
excellent customer feedback  the w ebshop enabled 
customers to shop up to 25 faster than before  w e 
regularly make enhancements to our w ebshop and use our 
technological base to improve the customer experience and 
service  w e launched “shop in shop” allowing suppliers to 
showcase their specific ranges in their own dedicated section 
of the w ebshop  
checkouts via mobile devices grew to 18 of checkouts by 
the end of the period up from 12 at the beginning of 
the year  
w e enhanced the functionality and usability of the existing 
ocado apps available for the iphone the ipad and the 
android platform and developed ocado apps for the 
blackberry and the windows phone 7 mobile devices  
other software developments included our “oneclick 
additions” feature allowing customers on mobile devices 
to amend an existing delivery without needing to check out 
again  ocado is the only uk supermarket to offer customers 
full shopping functionality on all leading smartphone devices  
w e also implemented a new crm platform to improve the 
efficiency of our call centre and provide substantial benefits 
to customer service  ocado’s software development 
achievements were recognised with ocado being awarded 
a grocer gold a ward for consumer initiative of the year 
in 2011
“ w e will continue in 2012 to pursue our core strategy of improving 
our offer to customers and increasing capacity to meet growing demand  
it is our mission to ensure that customers continue to regard ocado 
as the marketleading offer in online grocery shopping”
tim steiner chief executive officer
fac t
ocado cfc computers 
make o ver 10 million 
convey orbelt r outing 
decisions every day
fac t
a recent stud y revealed 
that 695 of our baskets 
of branded pr oducts were 
cheaper than tesco com 07 stock code ocdo wwwocadogroupcom
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2106604 08022012 proof 1
chief executive officer’s review  
 
people and recognition
the key to our success is the energy and commitment of 
nearly 6000 employees in different areas of the business  
i would like to recognise the tremendous efforts made by 
them throughout the year  our customers and industry 
observers regularly comment on the outstanding service 
provided by our delivery team of over 2000 customer 
service t eam members  the measures taken by ocado to 
make its delivery vehicles safe were again recognised in 2011 
by ocado winning for the second year running the safe 
vehicles a ward at the fleet safety forum a wards organised 
by road safety charity brake  ocado also won the fleet van 
operator of the year at the fleet t ransport a wards
the overall standard of the business was again recognised with 
our selection as a finalist for the etailer of the year award at the 
2011 oracle w orld retail a wards and being voted the favourite 
online supermarket in the which magazine reader surveys  
in november 2011 we signed a voluntary union recognition 
agreement with usdaw for ocado’s hourly paid employees at 
all our current operational sites  usdaw representatives will 
participate on our existing ocado council to voice the views of 
the employees they represent  the ocado council continues to 
be the forum that we use to consult with our employees
current trading and outlook
against the backdrop of the weak uk economy we have 
continued to see growth in the online grocery retail market  
w e believe this is evidence of a structural shift in consumer 
behaviour and we will see continued expansion of the 
market  ocado is well positioned to capture this growth as 
the marketleading offer in online grocery shopping
ocado achieved gross sales growth of 166 in 2011 during 
a period of capacity constraints at cfc1 our growth has 
continued into 2012 sales growth in the first quarter was 
109 similar to q4 2011  given the sales growth profile we 
experienced in 2011 as a result of capacity constraints we 
expect our growth rate to improve as the year progresses
in 2012 we will continue to pursue our existing strategy 
to improve what we offer our customers to complete 
the capacity expansion work at cfc1 and to continue the 
build commissioning and testing of cfc2  w e will focus on 
improving the levels of service beyond that which we gave 
our customers in the second half of 2011
it is our mission to make sure that customers continue to 
regard ocado as the marketleading offer in online grocery 
shopping  w e will continue to provide for and capture the 
growth of this market sector  the operational leverage we 
have in our business positions us strongly to benefit from 
increased scale to achieve a level of profitability that satisfies 
all stakeholders in the business
tim steiner
chief executive officer 08
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
chief financial officer’s review 
  
chief financial officer’s review
ocado’s sales growth and improved operational profitability 
continued in 2011  gross sales grew by 166 from 2010 
ebitda margin as a percentage of revenue increased from 
43 to 47
the balance sheet continued to be strong with net assets of 
£1729 million an increase of £11 million on 2010  cash was 
well controlled in the period with net cash from operating 
activities of £201 million  at 27 november 2011 the group 
had net debt of £192 million as it began to draw on the 
£100 million credit facility to grow the business  cash and 
cash equivalents at the year end were £921 million
despite the uncertainty of the uk economic environment 
the strength of the period end balance sheet combined with 
the operational improvements and continued sales growth 
leaves the group well placed moving into 2012
revenue
gross sales were up 166 to £6428 million for the period  
growth continued to be driven by an increase in average 
orders per week to 110219 from 92916 an increase of 
186  this was offset by a slight decrease in the average 
order size of 17 to £11215  this was mainly due to an 
increasing number of customers signing up to the ocado 
delivery p ass  the number of active customers increased by 
135 to 298000 at the year end  revenue grew by 160 
to £5983 million  spend on marketing vouchers at £80 
million equated to 13 of revenue down from 16 in 2010 
due to reduced use of vouchers as a marketing tool
gross profit
gross profit increased 143 to £1848 million this equates 
to a 47 basis points decrease in gross margin percentage 
over the period to 309  the decrease in gross margin was 
caused by a decrease in delivery income per order changes in 
product mix and increases in product sourcing costs as well 
as promotional activity and postdelivery adjustments during 
the period  the increased postdelivery adjustment costs 
were primarily due to the capacity constraints experienced 
in the year since year end these have returned to previous 
levels  the reduction in gross margin was mitigated by an 
increase in other income from suppliers which increased 
significantly by 1010 to £126 million  
this was driven by the increased sale of space on our 
new w ebshop  in addition a number of new initiatives in 
the second half of the period such as “shop in shop” this 
provides suppliers with their own dedicated shop within 
ocado’s w ebshop have enabled increased revenue to be 
generated
operating costs 
at £1517 million distribution costs fell as a percentage of 
revenue from 258 in 2010 to 254 in 2011  distribution 
costs increased by 142 on the prior period  the two 
major components of distribution costs are cfc1 costs 
as well as trunking and delivery costs  cfc1 costs fell as a 
percentage of revenue from 115 in 2010 to 113 in 2011 
and represented an increase of 139 on the prior period  
variable cfc1 costs increased slightly faster than revenue as 
a result of increased labour required to mitigate temporary 
capacity constraints  however the operating leverage of the 
fixed cost base on increased volume combined with some 
savings in the fixed cost base meant that total cfc1 costs fell 
as a percentage of sales  t runking and delivery costs fell as a 
percentage of revenue from 132 in 2010 to 129 in 2011 
and represented an increase of 138 on the prior period 
with productivity gains more than offsetting inflationary 
pressures  administrative expenses including marketing costs 
increased by 206 to £445 million up by 28 basis points as 
a percentage of revenue to 74 largely due to an increase in 
other marketing activity to partly complement the reduced 
use of vouchers
operating profitloss
operating profit for the period was £11 million compared 
with an operating loss of £54 million in 2010  this 
improvement is mainly attributable to the growth in revenue 
contributing to profit and enabling greater operating 
efficiencies
“with a sales increase of 166 in 2011 we are
confident that ocado grew faster than other players  
in the sector  due to our competitive advantage 
online we are well placed to deliver for  
shareholders as well as customers”
andrew bracey chief financial officer
fac t
every week 450 suppliers 
deliver gr oceries t o our 
hatfield cfc 09 stock code ocdo wwwocadogroupcom
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2106604 08022012 proof 1
chief financial officer’s review  
 
net finance costs
the reduction in net finance costs of 490 to £35 million was 
largely the result of the repayment of four longterm loans in the 
second half of 2010  a large proportion of the borrowing costs 
under the £100 million credit facility remain on the balance sheet 
as they have been accounted for as transaction costs and will 
either affect profit or loss over the remaining period of the loan 
or be capitalised to property plant and equipment to the extent 
that drawdowns directly finance qualifying assets  
loss before tax
loss before tax for the period was £24 million an 
improvement of £98 million against 2010
taxation
due to the availability of capital allowances and loss relief 
the group did not pay corporation tax during the year  a 
deferred tax credit of £19 million was recognised during 
the period as we begin to recognise more of the tax losses 
available for use against future taxable profits  ocado had 
approximately £279 million of unutilised carried forward tax 
losses at the end of the period
loss per share
basic and diluted loss per share decreased from 163p to 
010p primarily due to the improved financial performance of 
the group
cashflow
net operating cashflow before finance costs increased to 
£264 million up 422 from £185 million in 2010  this 
increase is primarily driven by an increase in ebitda and 
the fall away of the 2010 ipo costs   the net movement in 
working capital was an outflow of £26 million 2010 £04 
million  the increase in trade and other receivables was due 
to amounts outstanding at the period end in relation to other 
income and an increase in vat receivable due to the volume 
of invoices relating to capital projects in progress this offset 
a significant increase in trade and other payables arising from 
business growth and capital projects in progress
balance sheet
the group had cash and cash equivalents of £921 million at 
the period end this was down 404 from the 28 november 
2010 amount which included treasury deposits due to the 
continued capital investment required to expand the business  
the group had net debt of £192 million at 27 november 
2011 2010 net cash of £805 million as it began to draw 
on the £100 million credit facility to assist in funding capital 
investment  at year end ocado has drawn £402 million of 
this facility  total undrawn facilities at 27 november 2011 
including this facility were £788 million 2010 £1173 million
during the period the group agreed with its banks to 
increase one of its covenant ratios in the £100 million credit 
facility for the remainder of the life of the facility which runs 
to january 2014  given the current difficult economic climate 
the group continues to monitor closely its liquidity position 
for a range of scenarios for revenues cost performance and 
capital spend
capital investment
in the period ocado invested £1261 million in capital items 
an increase of 260 on the prior year  of this £277 million 
was on projects in cfc1 to expand capacity the benefits 
of which will be realised from 2012 onwards  the amount 
spent on cfc2 in 2011 was £726 million including the 
acquisition of land  the work schedule and costs on cfc2 
are in line with expectations  the project is expected to 
complete in the first quarter of 2013  investment in new 
vehicles in 2011 was £71 million  capital expenditure on the 
expansion of the delivery network was £47 million two new 
spokes opened in the period both of which are leasehold 
sites  an additional freehold site was purchased and partially 
developed in the period  the group continues to develop 
the majority of its own software and during the period £82 
million of internal development costs were capitalised as 
intangible assets
andrew bracey
chief financial officer
key performance indicators
the following table sets out a summary of selected unaudited operating information for fy11 and fy10
 
 
fy11
unaudited
fy10
unaudited  change 
a verage orders per week 110219 92916 186
a verage order size £
1
11215 11406 17
cfc efficiency units per hour
2
111 121 82
a verage deliveries per van per week dpvweek 145 133 87
a verage product wastage  of revenue
3
070 064 na
items delivered exactly as ordered 
4
983 990 na
deliveries on time or early  923 949 na
source the information in the table above is derived from information extracted from management accounts and internal 
financial and operating reporting systems and is unaudited
1
 a verage retail value of goods a customer receives including vat and delivery charge per order
2
 measured as units dispatched from the cfc per hour worked by cfc operational personnel
3
 value of products purged for having passed ocado’s “use by” life guarantee divided by revenue
4
 percentage of all items delivered exactly as ordered ie the percentage of items neither missing nor substituted 10
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
marketplace 
  
“ocado represents the marketleading model in the expanding online 
grocery market  w e are focused solely on the sale of groceries and non
food online and are committed to growing the online channel without the 
distraction of legacy bricks and mortar operations”
jason gissing commercial director
substantial underlying grocery market in uk
the uk food and grocery market now exceeds £150 billion 
it represents approximately 50p of every £1 spent on retail 
in the uk  the marketplace remains highly competitive and 
dominated by the big four grocers asda morrisons sainsbury 
and tesco  this intensity drives competition for market share 
with retailers constantly striving to find new ways to strengthen 
customer engagement and relationships and increase spend
the economic downturn has added to pressure on consumers 
and on retailers seeking to attract their spend  customers are 
looking to shop smarter with factors such as fuel costs and 
value for money becoming increasingly important  against the 
backdrop of this difficult trading environment which is likely 
to continue in the near term parts of the market continue to 
grow strongly including online discount and convenience
online grocery market growth
the uk has seen continued internet penetration and 
ecommerce activity with online retail activities developing 
beyond the original early adopters to a more mainstream  
customer set  grocery has been slower to develop into an 
online category  however the uk has the most advanced 
online grocery market globally which has continued to grow 
rapidly from a small base currently approaching 4 of the total 
grocery market 
online grocery is widely expected to become an increasingly 
significant channel with all leading grocery retailers carefully 
considering their online strategies 
improved range and price drives channel shift
pre 1950s 
loc al st ore
• limited range
• high prices
• counter service
high street 
chain
• wide range
• lower prices
• self service
out of t own 
supermarket
• wider range
• lower prices
• drive to location
online
• wider range
• competitive pricing
• improved convenience 
and service
• best location  your 
home
1 2
3 4
marketplace 11 stock code ocdo wwwocadogroupcom
governance our responsibilities our financials
2106604 08022012 proof 1
about oc ado our performance
structural drivers fuel growth
significant channel shift has taken place in the uk grocery 
market over the last 60 years  a movement from local stores 
to high street supermarket chains was followed by the shift to 
larger out of town superstores and hypermarkets in each case 
the channel shift has been driven by a wider range of product 
and lower prices  however with each channel shift service 
levels and location have become increasingly less attractive to 
the customer
the key driver to shifting consumers online is to improve the 
customer offer and experience in shopping for their groceries  
as the online grocery proposition becomes increasingly 
attractive to the customer the market will continue to grow 
significantly into a mainstream grocery shopping channel
developing this customer proposition involves providing the 
widest range of product across food and nonfood categories 
at a price that is at least as competitive as can be found in 
physical stores  customers also place great importance on 
reliable and accurate delivery product quality and freshness and 
overall ease of use
online grocery retail presents 
unique challenges
the online channel in grocery has been slower to develop 
than other segments of the retail market partly due to the 
unique challenges associated with providing this service with 
the logistical challenges involved providing one of the biggest 
barriers to entry
fulfilment of a customer order through an online service is 
complicated picking an average of over 50 items per order 
from over 20000 skus across three temperature zones with 
different product life ambient chilled and frozen for onward 
delivery to customers in narrow time slots presents many 
challenges  w e seek to overcome these challenges with our 
unique business model and use of our proprietary knowledge 
and technology
t echnology and innovation
t echnology and innovation influence 
many aspects of online grocery 
retailing  it serves as a driver for 
underlying demand with increased 
internet penetration and faster 
broadband speeds  it also deepens 
customer engagement through 
for example the increase in using 
mobile devices and tablets as a 
shopping tool technology and innovation are key to addressing 
many of the challenges in providing a superior online grocery 
proposition both for the customer easy to use websites 
mobile device apps for checkout and to drive operational 
efficiency in the supply chain and fulfilment
different online strategies
there is no single strategy for online retailing  in the grocery 
sector different approaches are being adopted with traditional 
storebased retailers largely using existing stores or storebased 
systems  by contrast ocado uses a centralised picking model 
with a spoke distribution network  this pioneering approach 
has been developed by ocado over several years using its 
own bespoke systems knowhow and software making such a 
model difficult to replicate 
2012 and beyond
further growth in online grocery retailing is set to continue 
significant development of the customer proposition within the 
channel will hasten this growth and transform such a channel 
migration from a niche activity to 
a full market shift representing 
a sizeable part of the 
uk grocery market 
uk online grocery 
spend £bn
2013 2012 2014 2016 2015 2010 2011
56
65
84
75
93
49
42
12
15
18
16
19
10
07
59
49
68
80
91
102
112
grocery
nonfood
source igd
online
£5bn
uk grocery 
market value
fac t
more than 40 of the 
popula tion intend t o 
use the online channel 
for at least part of their 
gr ocery shopping within 
five t o ten years
source igd
marketplace  
 
£151bn 12
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
driving the online proposition   
buy the freshest 
pr oduce online
save money by 
shopping online
freshness
price
a ccess t o a wider 
choice of gr oceries 
online than at a 
nearby st ore
range
why customers choose to shop online for groceries
1 2 3
the online grocery market is expected to experience significant growth at the 
expense of traditional grocery channels and adoption is influenced by a number 
of complementary drivers
✔ ✔ ✔
driving the online proposition    
  
the pr oduct  
life of all our 
fresh pr oducts is 
guaranteed
our model removes one stage 
of the grocery supply chain  
this combined with rapid 
stock turn means we often 
get product to customers the 
same or next day following 
receipt into our warehouse  
this can be quicker than other 
supermarkets get the product 
to their stores  w e offer a life 
of product guarantee giving 
confidence to customers that 
their groceries have a minimum 
remaining life when delivered
we no w
1
 price 
ma tch the largest 
competit or on o ver 
8000 skus
the automation and 
aggregation of our model 
strips out costs and increases 
efficiency  these savings allow us 
to offer products at compelling 
prices  w e work hard with our 
suppliers to provide market 
leading promotions for our 
customers
1
 march 2012
at full c apa city 
we will be able t o 
st ock up t o 40000 
gr ocery skus in one 
loc ation  this is 
over 50 more than 
a typic al large 
supermarket
w e will be able to stock a 
bigger grocery range than any 
other uk supermarket  this 
reduces the need to shop 
elsewhere  our range includes 
products with different price 
points in the same category to 
appeal to different customer 
wallets
the ocado w ay
range
freshness
price 13 stock code ocdo wwwocadogroupcom
governance our responsibilities our financials
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about oc ado our performance
delivering the online proposition      
 
convenient q uick 
and easy t o use
consistent order 
reliability  on time 
and as ordered
convenient next 
day delivery with 
very high st ock 
availability
ease of use reliability availability
4 5 6
✔ ✔ ✔
20 of all our 
checkouts now
1
 
made using mobile 
apps
inhouse software development 
allows for rapid introduction 
of new functionality  w e were 
the first grocer to launch a 
fully transactional mobile app 
offering increasing convenience 
to the customer  the shopping 
experience could not be 
easier from ordering anytime 
anywhere to delivery in the 
narrowest delivery time 
window in the market
1
 end january 2012
over 98 of items are 
delivered 
as ordered
the combination of our 
centralised model and our 
proprietary software leads 
to unrivalled reliability  our 
systems have evolved following 
much iteration to integrate 
all aspects of the customer 
fulfilment process
more than 95 
of our range is 
available for next 
day delivery at any 
one time
proprietary integrated systems 
give control over the product 
flow  this combined with the 
scale of our warehouse leads 
to structurally higher product 
availability  this reduces the 
chance of products being 
out of stock and minimises 
substitutions
ease of use reliability availability

grocery shopping made easy
register at ocadocom
w e deliver to your kitchen start shopping
   through our leading customer offer 14
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
strategy addressing the market 
  
strategy  addressing the market preparing for the 
activity in 2011
w e continuously focus on improving the service we offer our customers 
in doing this we focus on three key elements product price and service  
combined efficiently these elements are drawing new customers to ocado  
priorities key achievements kpis key initiatives effect on kpis execution risks
customer offer
range price and 
freshness
w e aim to provide a wider range 
than traditional storebased channels 
with a price competitive offer and 
superior freshness with product life 
guarantee
 rolled out own label range
 introduced specialist ranges
 launched ocado saving p ass
 t esco price match c7000 skus 
at end of 2011
  significant work with suppliers 
and substantially increased 
number of promotions
 at year end stocked c 20000
 skus including over 600 ocado 
own label skus
 further develop own label range
 introduce more specialty food lines 
 increase promotional activity
 expand nonfood lines
  significantly increase the number of 
skus stocked by end of 2012
 expected capacity increases from 
new mhe may come on line more 
slowly than anticipated
 disruptive price moves by
 competition could impact margin
service and usability
w e aim to provide marketleading 
levels of service availability accuracy 
and ease of use for our customers
  completed roll out of the latest 
version of our w ebshop
 launched apps on blackberry  
 windows phone 7
 introduced a number of new  
 customer features
  faster shopping times
  18 of check outs on a mobile 
app by year end 20 by january 
2012
 orders delivered as ordered 983
 deliveries on time or
 early 923
 continued use of technology
 and innovation to improve the
 customer offer and service levels
 improvement in  of orders
 delivered as ordered
 improvement in  of
 deliveries on time or early
 unforeseen operational challenges 
occur as we increase capacity at 
cfc1
operational  capacity
cfc1
w e continue to invest in greater 
capacity at our existing hatfield cfc  
w e implemented a series of changes 
in 2011 to enhance the future 
capacity and efficiency of cfc1 while 
impacting on shortterm operations
  added significant mhe
  added c5km of conveyor and 
new smart control software
 introduced new ambient zone 
 pick with latest generation 
 conveyor
 cfc1 efficiency at 111 units
 per hour vs longterm target 
of 180
 a verage orders per week over
 110000 peaking at over 131000
  start operation of new mhe 
installed in 2011
  remove the remaining inefficient 
trolley pick operation
 improvements to cfc efficiency
 and together with other cfc 
 improvements will drive kpi
 efficiencies order and delivery
 service levels
 mhe implementation is delayed
 unforeseen operational challenges 
occur as we increase capacity at 
cfc1
cfc2
our new cfc development in 
dordon w arwickshire planned to 
open in early 2013
 significant progress at  
dordon with building services 
and ancillary infrastructure largely 
complete and mhe installation 
started
 complete all work with testing
 and commissioning commencing
 mid 2012 ready to go live
 q1 2013
 t esting and commissioning
 schedule delayed
spokes
the majority of orders are relayed 
from cfc1 to spoke sites for onward 
delivery to customers
 bristol and wimbledon spokes
  opened during period oxford 
spoke opened in q1 2012
 london area capacity increased
 by 17000 orders per week
 with wimbledon spoke opening
 maximise throughput at each
 spoke with increased cfc
 capacity
 delivery kpis improve current spokes become capacity
 constrained
van fleet
our customer service team members 
deliver direct to customers’ kitchens 
using our fleet of bespoke vans
 t racking and routing technology 
upgraded
 deliveries per van per week
 increased to 145 peaking at 165 
vs longterm target of 175
 expand van fleet as capacity
 increases
 delivery kpis improve legislative and environmental 
factors impact on the mode of 
operations
 unforeseen impact of olympic 
games 15 stock code ocdo wwwocadogroupcom
governance our responsibilities our financials
2106604 08022012 proof 1
about oc ado our performance
our priorities for 2012
priorities key achievements kpis key initiatives effect on kpis execution risks
customer offer
range price and 
freshness
w e aim to provide a wider range 
than traditional storebased channels 
with a price competitive offer and 
superior freshness with product life 
guarantee
 rolled out own label range
 introduced specialist ranges
 launched ocado saving p ass
 t esco price match c7000 skus 
at end of 2011
  significant work with suppliers 
and substantially increased 
number of promotions
 at year end stocked c 20000
 skus including over 600 ocado 
own label skus
 further develop own label range
 introduce more specialty food lines 
 increase promotional activity
 expand nonfood lines
  significantly increase the number of 
skus stocked by end of 2012
 expected capacity increases from 
new mhe may come on line more 
slowly than anticipated
 disruptive price moves by
 competition could impact margin
service and usability
w e aim to provide marketleading 
levels of service availability accuracy 
and ease of use for our customers
  completed roll out of the latest 
version of our w ebshop
 launched apps on blackberry  
 windows phone 7
 introduced a number of new  
 customer features
  faster shopping times
  18 of check outs on a mobile 
app by year end 20 by january 
2012
 orders delivered as ordered 983
 deliveries on time or
 early 923
 continued use of technology
 and innovation to improve the
 customer offer and service levels
 improvement in  of orders
 delivered as ordered
 improvement in  of
 deliveries on time or early
 unforeseen operational challenges 
occur as we increase capacity at 
cfc1
operational  capacity
cfc1
w e continue to invest in greater 
capacity at our existing hatfield cfc  
w e implemented a series of changes 
in 2011 to enhance the future 
capacity and efficiency of cfc1 while 
impacting on shortterm operations
  added significant mhe
  added c5km of conveyor and 
new smart control software
 introduced new ambient zone 
 pick with latest generation 
 conveyor
 cfc1 efficiency at 111 units
 per hour vs longterm target 
of 180
 a verage orders per week over
 110000 peaking at over 131000
  start operation of new mhe 
installed in 2011
  remove the remaining inefficient 
trolley pick operation
 improvements to cfc efficiency
 and together with other cfc 
 improvements will drive kpi
 efficiencies order and delivery
 service levels
 mhe implementation is delayed
 unforeseen operational challenges 
occur as we increase capacity at 
cfc1
cfc2
our new cfc development in 
dordon w arwickshire planned to 
open in early 2013
 significant progress at  
dordon with building services 
and ancillary infrastructure largely 
complete and mhe installation 
started
 complete all work with testing
 and commissioning commencing
 mid 2012 ready to go live
 q1 2013
 t esting and commissioning
 schedule delayed
spokes
the majority of orders are relayed 
from cfc1 to spoke sites for onward 
delivery to customers
 bristol and wimbledon spokes
  opened during period oxford 
spoke opened in q1 2012
 london area capacity increased
 by 17000 orders per week
 with wimbledon spoke opening
 maximise throughput at each
 spoke with increased cfc
 capacity
 delivery kpis improve current spokes become capacity
 constrained
van fleet
our customer service team members 
deliver direct to customers’ kitchens 
using our fleet of bespoke vans
 t racking and routing technology 
upgraded
 deliveries per van per week
 increased to 145 peaking at 165 
vs longterm target of 175
 expand van fleet as capacity
 increases
 delivery kpis improve legislative and environmental 
factors impact on the mode of 
operations
 unforeseen impact of olympic 
games
strategy addressing the market  
 
simultaneously  we are investing in our infrastructure to service this growth and 
driving efficiency throughout the delivery cycle  w e have set out the key initiatives 
from the past year and the key priorities for the year ahead  w e would also refer 
you to the risks section on pages 18 to 23 in looking at these initiatives
future and driving efficiency 16
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
questions and answers 
  
questions and answers
tim steiner chief executive officer addresses some of the most 
frequently asked questions about our company
q  what are the main trends driving your 
marketplace in particular how are you affected 
by key competitors investing more in their 
online operations
a   a number of factors including fast growing internet and 
smartphone penetration an increase in available product 
range lower prices convenience time and fuel savings are 
driving a sharp increase in online shopping  in particular 
the advantage of shorter time slots for delivery are starting 
to influence customers’ decisions to buy groceries online  
investment in online by competitors is good for us as it 
acknowledges online as an increasingly significant channel  
the key driver to shifting consumers online is to improve the 
customer offer and experience in shopping for their groceries 
as the online grocery proposition becomes increasingly 
attractive to the customer the market will continue to grow 
significantly into a mainstream grocery shopping channel
tim steiner
chief executive officer
q  are you concerned about reports that 
competitors are opening their own automated 
“dark stores”
a   it is interesting to hear about our competitors’ dark 
stores  w e see reports of bigger warehouses and increased 
automation as a further validation of our model which we have 
been operating and building knowledge of over the last ten 
years  w e believe our centralised picking model is significantly 
more efficient than the online operations of our peers  w e will 
continue to build our offer to our customers to continue to 
attract those converting to the online model
q  you are sometimes referred to as “w aitrose 
on wheels” but they are now offering their own 
online grocery service how does this impact on 
the ocado business
a   w e enjoy a longterm relationship with w aitrose  w e are 
two independent retail groups and as such it is only natural 
that w aitrose should continue to develop their own online 
offer which predates our business  w e believe their business 
model is quite different to ours centred on their store assets  
w e see any investment into online grocery retailing that they 
make as positive in converting shoppers from storebased to 
online and we further believe that our customer proposition 
driven by our unique business model positions us well to 
subsequently attract disproportionately high numbers of 
these online shoppers to shopping with ocado
q  how does the broader economic 
downturn impact you  
a   customers become ever more discerning about price 
and value for money  our efforts to continually improve 
the customer offer with a broader range offering different 
price points and more choice together with the multitude 
of initiatives we have to lower prices for customers which 
include t esco price match and the ocado saving pass are 
key to continue attracting and retaining customers  while 
customers may put an item or two less in their shopping 
baskets this is generally offset in value terms by inflation  fuel 
costs have continued to rise and customers are increasingly 
attracted to the convenience cost and time saving that 
shopping online brings in difficult economic times
q  what do you see as key to driving your 
proposition to customers
a   w e seek to provide and have available the widest range 
of any grocery store offer competitive pricing and sufficient 
price points in each category without compromising on 
quality or freshness  w e use our innovative approaches and 
advanced technological knowledge to make our service the 
easiest to use for customers and to drive efficiencies through 
the entire process to give the best customer service and 
maximise longterm financial returns 17 stock code ocdo wwwocadogroupcom
governance our responsibilities our financials
2106604 08022012 proof 1
about oc ado our performance
questions and answers  
 
q  how important is technology to 
your business 
a   t echnology and innovation is at the heart of ocado’s 
business  w e develop our own software which gives us a 
proprietary knowledge base that acts as a natural protection 
against competitors 
w e are able to utilise our technology platform and innovative 
approach to better engage with the customer through easy 
to use interfaces  w e were the first in the market to develop 
a fully transactional app for the iphone and now have apps 
across all major operating systems for mobile devices and 
are constantly improving our w ebshop  at the same time 
we deploy our technology to drive the efficiency of our 
operations in order to fulfil our customers’ orders with 
market leading service levels
view our online video at httpocadogroupcomaboutus
introductoryvideoaspx to see the impact of technology in 
our business
q  do you intend to further broaden your 
appeal beyond your more traditional higher 
income customers
a   ocado is a shop for everyone  w e want to be seen as 
the grocery retailer of choice for the ordinary shopper who 
seeks quality products at competitive prices  our customers 
come from a crosssection of income and age demographics  
our focus on extending our product range to one that will 
exceed even the largest storebased supermarkets coupled 
with our pricing initiatives are further driving our growth and 
reach to a broader cross section of the uk population
q  there was a lot of talk of capacity constraints 
which caused some disruption last year and 
which had an impact on growth  have these 
now been resolved and can we expect service 
levels to return to previous highs
a   w e were naturally disappointed with the levels of 
customer service that we delivered during the latter part of 
2011 which while still market leading fell below levels that we 
and more importantly our customers have come to expect
w e are however confident that the operational challenges 
in cfc1 which gave rise to the above are now largely 
behind us  these related to a variety of capacity expansion 
projects and additional maintenance or improvement work 
this had an impact on shortterm capacity and efficiency 
while we continued to fulfil customer orders from hatfield  
the majority of this work has now been completed and as 
the capital investment projects have gone live we have seen 
capacity build  moreover we now have a much more robust 
operational infrastructure to service and drive expected 
future growth
q  how does expansion into ownlabel and 
nonfood complement your strategy
a   offering a broader range and different price points 
are both critical in attracting and retaining customers  our 
ownlabel strategy forms part of our initiative to address both 
of these key drivers of customer demand  our ownlabel 
products now feature in 70 of our customers’ baskets  
w e already sell nonfood products which are adjacent to 
our grocery offer   w e intend to further expand the number 
of nonfood lines this year which will offer more choice and 
allow customers the ease of also having their nonfood items 
delivered in dedicated onehour timeslots rather than having to 
seek alternative destinations to complete their weekly shop 
q  will you be expanding your service into 
other parts of the uk
a   w e currently cover over 70 of the uk population 
our immediate strategy is to consolidate in existing delivery 
coverage areas by improving the drop density for each of 
our delivery vans hence driving efficiency returns and the 
investment we can put back into the customer proposition 
at the same time we constantly consider the viability of 
introducing our service to parts of the uk currently not 
covered by ocado 
q how do you ensure that your employees are 
engaged with the business
a   w e run an annual employee survey across the whole business 
to measure levels of employee engagement and to identify areas 
that need improvement  employees are kept informed of the 
business’ performance and key events that may affect performance 
through regular business briefings and electronic communications 
which also make our employees aware of the various factors that 
can affect the business’ performance  w e have also introduced a 
management development programme which gives employees 
the opportunity to progress their career within ocado
q how are you working towards reducing 
ocado’s environmental impact
a  the way the business operates using an automated cfc 
means that our product waste is very low at only 070 of 
revenue in the period  most of our product waste is within 
the “use by date” and is sold at a discount to a specialist 
food distributor  w e help our customers reduce their own 
wastage by showing guaranteed product life on the w ebshop 
and including ‘useby’ dates on order receipts  w e use a 
number of initiatives to reduce the impact that the business 
has on the environment including closed loop carrier bag 
recycling green van deliveries and ongoing energy efficiency 
projects in cfc1  w e also use electric vans as part of the 
delivery fleet at our london spokes 18
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
principal risks and uncertainties 
  
principal risks and uncertainties
identifying and monitoring risks
the group faces a number of risks and uncertainties that may have an adverse impact on the group’s operation performance 
or future prospects  
it is important for the board to effectively manage risks and opportunities in seeking to achieve the group’s objectives 
the directors have overall responsibility for risk management and internal control systems  the group’s system of risk 
management is described in the statement of corporate governance 
the risks and uncertainties described below represent those which the directors consider to be the most significant in 
achieving the potential success of the group’s strategy  however these principal risks and uncertainties do not comprise all of 
the risks associated with the group and are not set out in any order of priority  additional risks and uncertainties currently not 
known to the directors andor which the directors believe to be less material may also have a material adverse effect on the 
group’s business financial condition or future prospects  the relevant mitigating factors are also described below 
risk area potential impact mitigation
strategy
expansion of cfc1 and 
construction 
of cfc2
a critical part of the group’s strategy is to 
expand its operations in the uk by further 
developing cfc1 and building cfc2 at dordon 
w arwickshire to significantly increase its capacity 
to service customers  the group is currently 
undertaking several capacity enhancing projects 
in cfc1 which are highly complex and can result 
in operational difficulties whilst they are being 
tested and integrated into the current operation 
additional capacity projects will be needed in 
the future to realise cfc1’s full capacity  while 
projects are undertaken these could have a 
negative impact on the operational efficiency of 
cfc1 customer fulfilment delivery timeliness and 
ultimately the group’s financial performance  the 
group’s ability to develop cfc1 and replicate 
its business model in cfc2 costeffectively and 
in a timely fashion will depend upon a variety 
of factors notably the group’s ability to hire 
and train employees to operate the cfcs 
management resources the group’s ability to 
write additional complex software systems to 
operate the cfcs the group’s ability to roll 
out the business systems and infrastructure 
the retention of reliable developers and the 
availability of appropriate equipment and the 
contractors to design and install such equipment
management seek to manage the timing 
integration and testing of cfc1 capacity projects 
so as to minimise operational disruption  the 
group has employed additional labour at cfc1 
to protect customer service levels during work 
to install further capacity  this increased labour 
is expected to be phased out as the installation 
works are completed  
construction of cfc2 is ongoing  the group 
has a detailed plan for the management and 
resourcing of the cfc2 project and the directors 
have oversight of the project to ensure that it 
can stay on schedule and within budget  the 
directors are confident that the business systems 
of cfc1 can be replicated and enhanced in cfc2 
and in any further cfcs in the future within the 
parameters of the capital expenditure budget set 
for the cfc2 project and that it can continue to 
successfully complete and integrate projects to 
expand cfc1
expansion of nonfood 
product range
part of the group’s strategy is to significantly 
expand its nonfood product range  demand 
from its customers for many categories of non
food products is relatively untested and significant 
customer demand will be needed in order to 
deliver the group’s anticipated growth in non
food sales  the group’s capability to develop the 
nonfood business costeffectively and in a timely 
fashion in the medium term will depend on its 
ability to develop and integrate the necessary 
infrastructure and business systems needed to 
support the targeted diverse and large nonfood 
product range
the initial expansion of the nonfood range will 
be into product categories that are adjacent 
to the existing ocado product range such as 
kitchenware which the directors anticipate can 
be largely supported by the group’s existing 
infrastructure and systems and expect will require 
limited capital expenditure  the group has 
and will continue to retain recruit and train the 
necessary employees to manage the nonfood 
business and has some plans for implementing the 
necessary business systems and infrastructure to 
support the longerterm extension of the non
food range 19 stock code ocdo wwwocadogroupcom
governance about oc ado our financials
2106604 08022012 proof 1
our responsibilities our performance
principal risks and uncertainties  
 
risk area potential impact mitigation
operational 
single cfc the group is dependent on the continued 
operation of cfc1 and to a lesser extent the 
spokes in order to satisfy customer orders  any 
disruption such as a result of an it failure or a 
fire to the operation of cfc1 in particular or a 
spoke may therefore have an adverse effect on 
the group’s financial position or affect the ability 
of the group to economically deliver products to 
certain customers
the group has some documented disaster 
recovery procedures which are aimed at 
minimising certain possible disruptions to the 
business  in early 2012 the group achieved the 
insurance industry recognised “highly protected 
risk” status  cfc1 is protected by fire and 
security systems and has a full contingency plan 
to manage power outages  the group also has 
insurance policies in place which cover business 
interruption to certain maximum levels  in 
addition the eventual operation of cfc2 will limit 
in part the effect of any failure at cfc1  spokes 
are able to some extent to serve geographies of 
neighbouring spokes
relationships with 
third parties
relationship with 
w aitrose 
ocado’s reputation and brand is based at least 
in part on its relationship with w aitrose  if 
the sourcing agreement with w aitrose were 
to end or if w aitrose were unable to source 
products for the group ocado would need to 
engage additional personnel to i find or create 
replacement ownlabel products and ii find 
appropriate suppliers and negotiate equivalent 
prices itself
other than with regard to nongrocery products 
the sourcing agreement with w aitrose contains 
provisions which restrict the extent to which 
ocado can source products other than from 
w aitrose and the extent to which ocado’s range 
of ocado ownlabel products may be expanded  
the group is reliant on w aitrose for its sourcing 
and pricing of much of the group’s product range 
including accurately estimating and passing on the 
group’s share of supplier bonus and overrider 
payments 
if the parties terminate the sourcing agreement 
after certain competitors of w aitrose or john 
lewis gain control of the company ocado is 
obliged to pay w aitrose a maximum fee of £40 
million
the group has a successful relationship with 
w aitrose which is now in its twelfth year  the 
sourcing agreement with w aitrose will continue 
this relationship until at least 2017  the group 
is not particularly dependent on the w aitrose 
supply chain as about 84 of products are 
delivered directly to cfc1 by the relevant 
supplier or manufacturer 
ocado has about 620 ocado ownlabel products 
and will further extend this range  the sales of 
ocado ownlabel products is closely monitored 
to ensure that the limits in the sourcing 
agreement are not exceeded  the directors 
do not believe that the restrictions on ocado 
ownlabel products will have a significant impact 
on the growth of the business or their intended 
expansion of the range of products stocked by 
ocado
the group has reviewed the most significant 
of w aitrose’s supplier arrangements to give it 
oversight of the supplier support payments and 
their allocation between w aitrose and ocado for 
the period  20
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principal risks and uncertainties 
  
principal risks and uncertainties continued
risk area potential impact mitigation
it systems and 
security and  
intellectual property
it systems the group relies to a very significant degree 
on the efficient and uninterrupted operation 
of the internet and its it and communications 
systems  the group’s business model relies on 
the complex integration of the group’s w ebshop 
mobile apps the highly automated cfc1 material 
handling equipment and the order fulfilment and 
delivery operations  operational problems in 
the group’s core systems and technologies such 
as computer server or system failures network 
outages software performance problems or 
power failures can result in customer orders 
being unable to be captured on the group’s 
website or processed through cfc1 or errors 
and delays in their delivery
the group has an it strategy that is aimed at 
ensuring plans are in place to have information 
systems and new technology that provide the 
capabilities necessary for the group to maintain 
the integrity and reliability of its business  the 
group has disaster recovery plans to maintain the 
integrity of its it infrastructure  the group’s it 
systems are housed in a purposebuilt data centre 
and it has a separate disaster recovery location 
which houses standby servers for all of the critical 
systems and live replica data storage systems  all 
critical communication links between cfc1 and 
the disaster recovery location are provided via 
two diversely routed fibre optic cables and the 
group is provided with internet connectivity 
simultaneously by two major internet service 
providers
it security  
and fraud
if any compromise in the group’s it security 
measures or payment processing systems were 
to occur the group’s reputation may be harmed 
and it could lose its customers  the group relies 
on third parties to provide payment processing 
services and is exposed to typical fraud risk 
in relation to card payments  the group is 
also subject to it regulations and compliance 
requirements
the group uses encryption and authentication 
technology to provide the security necessary 
to effect the secure transmission of information 
from its customers such as card payments and to 
reduce possible fraud  the group’s customers’ 
confidential data is protected by both physical 
and systems controls  the group’s w ebshop is 
regularly tested for vulnerability by third parties 
from inside and outside the ocado network  
relevant accounting it and other procedures 
and controls at all levels are clearly set out and 
some of which are audited across the business to 
reduce the risk of fraud  ocado took significant 
steps in 2011 in its payment card industry data 
security standards “pci” compliance plan by 
moving all credit and debit card processing to a 
pci compliant external payment service provider
intellectual property 
rights
the business it systems bespoke software 
and intellectual property are not protected by 
patents or registered design rights which means 
that the group cannot inhibit competitors from 
entering the same market if they develop similar 
technology independently  in addition third 
parties may independently discover ocado’s trade 
secrets and proprietary information or systems
in order to minimise the disclosure of intellectual 
property outside the organisation the group 
chooses to rely on copyright confidentiality and 
licence agreements with its employees customers 
suppliers consultants and others to protect its 
intellectual property rights rather than take other 
protective measures 21 stock code ocdo wwwocadogroupcom
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corporate social responsibility report  
 
risk area potential impact mitigation
financing 
funding for capital 
expenditure
the group’s £100 million credit facility may 
be terminated by the lenders if the sourcing 
agreement with w aitrose is terminated for any 
reason
the group is able to manage whether any such 
termination rights will arise under the sourcing 
agreement and hence any potential impact on 
the debt facility with the exception of the change 
of control termination right described above
liquidity to manage the working capital needs of the 
business and to finance the group’s expansion 
plans the group is reliant on being able to 
arrange and maintain sufficient financing and to 
comply with their conditions once established
the most material of the group’s facilities is its 
£100 million credit facility  a material reduction 
in forecast ebitda could lead to a breach of 
covenants under this facility which would put the 
group in default of this facility and would allow 
the lenders to terminate the facility  this would 
jeopardise the group’s expansion plans and 
would threaten the group’s ability to continue as 
a going concern
the group maintains a mixture of short and 
mediumterm debt and lease finance arrangements 
that are designed to ensure that it has sufficient 
available funds to finance its operations  the board 
monitors rolling forecasts of the group’s liquidity 
requirements based on a range of conservative 
growth scenarios to ensure it has sufficient cash to 
meet operational needs while maintaining sufficient 
headroom on its committed borrowing facilities 
at all times so that the group does not breach 
borrowing limits or covenants where applicable 
on any of its borrowing facilities  as part of this 
the board continues to monitor the timing and 
amounts of uncommitted expenditure on capital 
projects  expenditure on these capital projects and 
other discretionary expenditure can be delayed if 
the group is performing at the lower end of the 
range of these scenarios
under all the above scenarios the directors have 
a reasonable expectation that the existing facilities 
provide sufficient funding for the group to operate 
as a going concern and to continue with many of its 
plans to expand the business  the group regularly 
reports to and meets with its key lenders to ensure 
that they are fully informed of the current business 
performance and future financing requirements of 
the group
exchange rate interest 
rate and commodity 
fluctuations
any depreciation of sterling in relation to the 
euro could increase the sterling equivalent of the 
price paid for the machinery used in cfc2 and 
to expand the capacity of cfc1 which is mostly 
purchased from suppliers located in countries 
that have adopted the euro  fluctuations in the 
cost of commodities affect the prices that the 
group pays for its grocery products and in the 
case of diesel to deliver to customers and often 
these cost increases are absorbed by the group  
fluctuations in interest rates will impact the 
finance costs to the business
the group has a policy controlled by the treasury 
committee and monitored by the board to 
hedge certain foreign currency and interest rate 
exposures through the use of derivative financial 
instruments and fixed and floating instruments  
there are approval parameters for hedging 
arrangements and a policy to monitor and review 
hedging arrangements including short and long
term foreign exchange rates interest rates and 
counterparty risk  22
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principal risks and uncertainties 
  
principal risks and uncertainties continued
risk area potential impact mitigation
staff
staff retention and 
recruitment
the group is reliant on its key management 
in particular and staff for the operation of 
its business and expansion of the business 
notably cfc2  the group’s ability to recruit 
retain and motivate suitably qualified and 
experienced staff is important for the group’s 
success  the relationship between the group 
and its workforce will be influenced by the 
union of shop distributive and allied w orkers 
“usdaw”  usdaw participates in the 
group’s employee representative body the 
ocado council since being formally recognised 
by the group in november 2011 in respect of 
the group’s hourly paid staff in relation to pay 
working hours and holidays
the directors continue to keep management 
and staff remuneration and incentivisation under 
review to ensure it remains competitive and 
motivating  the group has a written management 
succession plan for all key roles and made 
development plans for management 
the business has had good relations with its 
workforce to date  the ocado council provides 
the forum to discuss the terms and conditions of 
employment for the workforce and provide for 
further engagement with staff
risks relating to the 
industry
competition and the 
online grocery market
the trend in uk food retailing of moving from the 
traditional grocery market to the online grocery 
market may not continue in part because of 
changing economic conditions
the group may be adversely affected via loss of 
market share or by diminution of its gross margin 
through price competition by the entrance of 
new competitors in the online grocery market 
or if the traditional grocery retailers including 
w aitrose invest heavily in their online operations 
the directors believe that the online grocery 
market will continue to grow rapidly in the uk 
particularly as the number of people shopping 
online has continued to increase 
ocado has a business model which is predicated 
on offering our customers a superior service 
in terms of product quality and convenience 
reliability and accuracy of delivery as well 
as environmental efficiency  the directors 
believe that continuing to improve the group’s 
proprietary intellectual property and bespoke 
it systems including the group’s w ebshop and 
mobile apps the stock management systems the 
customer delivery system and the van routing 
system means that the group is able to maintain 
its market leading online grocery offer 
uk and global economic 
conditions
the group’s performance may depend on factors 
outside the control of the group which impact 
on uk consumer spending and demand including 
economic and financial conditions  the difficult 
economic environment in the uk is likely to 
result in increased retail price competition in the 
uk grocery market and lower product margins 
because of increased promotional activity which 
will mean that maintaining the group’s gross 
margins will be very challenging  in addition 
current economic conditions may lead to a 
reduction in the group’s sales or sales growth 
rate
the group regularly reviews its approach 
to pricing marketing and product range for 
appropriateness to market conditions and to 
adapt to customer feedback and pricing initiatives 
of its competitors  the group intends to 
significantly expand its product range including 
nongrocery and ocado ownlabel ranges and 
is trialling various customer retention and pricing 
initiatives in order to help meet its gross margin 
expectations  23 stock code ocdo wwwocadogroupcom
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risk area potential impact mitigation
regulation and 
safety
health and safety law a violation of health and safety laws relating to 
the group’s operations or construction of cfc2 
or expansion of cfc1 could lead to injury to 
employees negative publicity and reputational 
damage fines costly compliance procedures 
and in very serious circumstances a temporary 
shutdown of all or part of the business or a delay 
in construction of cfc2
the group’s health and safety department 
maintains and monitors procedures which are 
aligned with the relevant regulations and industry 
standards  the group’s staff are trained in safe 
workplace practices  the group has safety 
procedures and reporting structures for the 
cfc2 construction project
product safety the group is subject to a wide variety of 
regulatory requirements including those in 
relation to the manner in which it sources stores 
handles and sells products such as meat and fish 
to customers and relating to the operating of its 
physical facilities  any regulatory investigation or 
belief that the products including ocado own
label products supplied by the group caused 
illness or injury to customers or others could 
adversely affect the group’s reputation with 
existing and potential customers and its financial 
performance
there is an established legal and regulatory team 
in place to monitor developments and to ensure 
that all existing regulations are complied with  
the group has a food technology department 
which monitors the group’s facilities its vans 
and its procedures to ensure quality standards 
and compliance with applicable food law and 
which liaises with the w aitrose food technology 
department
government regulation
 
a change in regulations relating to the internet 
and online retail operations consumer protection 
laws the processing of customer data the 
environment such as carrier bags or the sale 
licensing or storage of products could adversely 
affect the manner in which the group currently 
conducts its business or the group’s operational 
costs  regulations govern the weight limits of the 
loads that each delivery van and lgv can take 
and the number of hours that drivers can work 
on consecutive days which constrain the potential 
delivery efficiency of the business
the group has an established governance process 
in place to monitor regulatory developments and 
to ensure that all existing regulations are complied 
with  the group’s delivery routing software and 
customised vans which are specifically designed 
to improve loadcarrying capacity help maximise 
the operational efficiency of the group’s delivery 
infrastructure within the scope of the existing 
regulatory requirements 24
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
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corporate social responsibility report 
  
corporate social responsibility report
introduction 
operating our business in a responsible way is fundamental both 
to the way we operate and to delivering sustainable profits and 
longterm value for our shareholders
this corporate social responsibility report explains how the 
group carries out its responsibilities with respect to the 
environment employment practices and the community 
environment 
part of the company’s strategy is to be the uk’s greenest 
most innovative and best value online grocer  ocado aims to 
provide a greener more sustainable alternative to storebased 
supermarkets 
a traditional supermarket requires deliveries first to be made 
to a regional distribution centre and then to the supermarket 
itself  customers will often drive to the supermarket in order 
to shop and the supermarkets themselves require energy to 
be lit and heated and tend to have open fridges and freezers 
in an otherwise ambient environment  ocado delivers from 
a customer fulfilment centre sometimes via a spoke to 
a customer’s kitchen which eliminates much of the carbon 
emissions generated by traditional supermarkets and their 
stores and also reduces the number of cars on the road  
each ocado delivery van replaces a significant number of car 
journeys every day
this sustainable alternative has been reflected in awards made 
to the company in recent years  among the awards ocado 
was voted green retailer of the year 2009 in the grocer 
gold a wards and received the good farm animal w elfare 
a ward 2011 in the compassion in w orld farming a wards for 
ocado ownlabel eggs
the group has taken a number of other steps in response to 
new carbon reduction legislation and to address the lessening 
of its carbon footprint as set out below
climate change agreement ocado has signedup to the 
climate change agreement with the carbon t rust which 
places certain obligations on the group to monitor and lower 
carbon usage 
1010 campaign in 2010 the company signedup to the 
1010 campaign which is a campaign run by an independent 
uk charity the 1010 t rust aimed at reducing carbon 
emissions by 10 in a year  the company continues to 
support the campaign and has signed up as a partner for 
2012  the company has not had its carbon emissions audited 
for the period since signing up to the 1010 campaign so 
cannot yet measure whether it has met this target  however 
the company measures its carbon emissions on an ongoing 
basis using a baseline measurement  these records show that 
it has been reducing its carbon emissions against previous 
periods when measured as a percentage of the group’s sales
electric vans ocado has codeveloped electric powered vans 
which are now part of our delivery fleet at our white city 
spoke 
green van deliveries customers can choose a ‘green van slot’ 
when booking a delivery time that is when a delivery van is 
already booked in that customer’s area which helps minimise 
the carbon impact of that customer’s delivery 
energy efficiency project ocado invested almost £02 million 
in the period on a project to improve the integrity of the 
chilled picking area in cfc1 by closing up small air escape 
holes upgrading doors and building airlocks in order to 
reduce the loss of chilled air  these changes will help to 
provide the business with energy savings  ocado makes it 
a standard requirement for new sites and new fit outs of 
existing buildings that they use energy efficient lighting motion 
detectors and daylight controls as part of its energy saving 
commitments  
environmental initiatives undertaken 
the group has taken a number of measures to reduce its 
environmental impact as set out below 
responsible bag recycling the business has a closedloop 
grocery bag recycling system whereby when making a 
delivery cstms offer to collect used carrier bags both 
ocado bags and any other company’s plastic bags from 
customers which are then recycled within the uk to make 
new ocado grocery bags 
reducing food wastage the directors believe that the group’s 
food waste as a percentage of revenue 070 of the revenue 
for the period is significantly less than any of its competitors 
ocado also helps its customers reduce their food waste 
by being the first online food retailer to show guaranteed 
product life on the website and by including ‘useby’ dates on 
each order receipt  some food that is beyond the guaranteed 
product life but within the useby date is donated to various 
charities including vineyard in southend ymc a in w atford 
and new hope t rust in w atford  any food that isn’t fit for 
ocado’s company shop or charities but is suitable for animals 
is sent to paradise wildlife p ark in broxbourne along with 
some allocated fresh produce  ocado also donates cat food 
and cat litter to cat protection a cat sanctuary based in 
w elwyn  
anaerobic digestion ocado uses a process called “anaerobic 
digestion” which is a process whereby some of ocado’s food 
waste is sent to biogen greenfinch an operator of anaerobic 
digestion plants to be mixed with bacteria and burnt to 
produce electricity and biofertiliser  the company receives a 
regular report which outlines the estimated amount of power 
that has been created through this process  for example 
in january 2012 the process generated an estimated 11606 
kilowatt hours of electricity and made a carbon saving of 
about 21883 kilograms 
meat free monday the company supports the “meat free 
monday” campaign which raises awareness of the climate
changing impact of meat production and consumption  the 
meat free monday campaign encourages people to reduce 
their greenhouse gas emissions by having at least one meat
free day every week  25 stock code ocdo wwwocadogroupcom
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suppliers and products
product range the ocado ownlabel was introduced in 
2010 to broaden the choice for our customers and offers 
good quality products at competitive prices  one of the key 
criteria when developing the ocado ownlabel range is that it 
must be responsibly sourced  the company supports british 
and eu farming and where possible sources relevant ocado 
ownlabel products from the british isles when in season and 
available  ocado fish is responsibly caught ocado fresh meat 
and poultry is raised to british eu or new zealand welfare 
standards ocado boxed eggs are freerange and all of the 
ocado brand bread is made using british wheat  ocado has 
now over 620 products in its ownlabel range 
waitrose foundation through its sourcing agreement 
with w aitrose ocado makes a donation to the w aitrose 
foundation  the w aitrose foundation is a partnership 
created in 2005 to help improve the lives of the farm 
workers and smallholders in south africa ghana and kenya 
who grow produce for the w aitrose foundation range of 
products  a percentage of profits from the sales in this 
range is paid into a trust to fund projects chosen by the 
farm workers’ and smallholders’ committees  these include 
educational social and healthcare projects in 20102011 the 
w aitrose foundation had launched over 200 projects ranging 
from crèches to adult literacy programmes and from sports 
teams to provision of equipment for medical clinics 
duchy originals products during the period ocado made 
a donation of about £228000 to the prince’s charities 
foundation a group of 20 nonprofit organisations through its 
sales of duchy originals branded products
fair trade ocado aims to trade fairly with its suppliers and 
supports established schemes such as fairtrade and t raidcraft 
which contribute to the sustainable development of the 
communities where farmers and workers live the directors 
believe that ocado has one of the largest fairtrade range of 
products of all uk grocers
organic farming ocado has a large selection of organic 
groceries organic farming helps promote biodiversity by 
using crop rotation and clover to build soil fertility  with 
organic farming there are strict rules around animal welfare 
and how food is produced 
soil association ocado supports the soil association a charity 
that campaigns for sustainable food and farming  
tetanus vaccines for unicef ocado makes donations to 
unicef  the children’s charity in the form of tetanus vaccines 
through the sales to its customers of certain fairy and 
pampers products  in the last two years ocado customers 
donated nearly one million tetanus vaccines as part of the 
pampersunicef campaign  in 2012 ocado hopes to bring 
this to a total of 15 million vaccines
people
ocado’s employees are key to its business and are the most 
visible part of the business to its customers  management is 
committed to high standards of employment practice and to 
providing equality of opportunity training and development 
and a safe workplace in addition to developing initiatives 
which encourage innovation
ocado aims to be an exceptional employer one that 
recognises talent and develops people to the best of 
their abilities in return we ask our people to share our 
determination to succeed  w e deliver superior customer 
service and business success through our people which is why 
it is important for us to appropriately reward engage listen to 
and develop our employees
rewarding our people
since its commencement as a privately owned business 
ocado’s policy has been to issue share options to its 
employees  the rationale is that we want to give all of our 
employees the opportunity to own a part of the business  
w e continue to grant share options in the company to each 
new employee as part of their employee benefits package
as part of ocado’s philosophy of employee share ownership 
the group also operates the ocado sharesave scheme 
in which a large number of employees participate  the 
sharesave scheme is a savingsrelated share option plan 
where each participating employee is granted options over 
shares in the company in proportion to the amount saved 
by that employee  following period end ocado launched 
a second offer to employees to join the ocado sharesave 
scheme 
w e expect that in future ocado will introduce additional 
share schemes to both reward employees and to offer 
employees further opportunities to become shareholders in 
the company
in addition to share schemes we provide a range of employee 
benefits including a staff discount on grocery orders with 
free deliveries on certain days encouraging our employees 
to be greener shoppers discount shopping membership a 
discounted staff shop pension life assurance healthcare and 
an employee assistance programme 26
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corporate social responsibility report 
  
corporate social responsibility report continued
engaging our people
engaged staff help us to continue to be successful and grow 
ocado uses an annual formal employee survey administered 
across the whole business to measure levels of employee 
engagement and identify the areas where we can become a 
better employer
w e continue to hold regular events such as our annual 
family fun day interspoke football tournament charity 
golf day w oodland t rust tree plant team days business 
results briefings and our christmas parties these reinforce 
our informal relaxed culture and promote our family and 
community focus
ocado’s employees are kept well informed of the 
performance of the group and key events concerning 
the business through regular staff briefings provided by 
management and through communications via the internet 
email and video and audio recordings which are particularly 
helpful for communicating with our large number of cstms  
it is hoped that such briefings and information will help our 
employees become aware of the various factors that affect 
the company’s performance 
giving our people a voice
the ocado council which is the ocado employee 
representative body helps facilitate employee participation 
and consultation in our rapidly growing business  the ocado 
council was formed in january 2010 and currently comprises 
51 council representatives from across the business  the 
ocado council’s achievements over its two years of existence 
include a review of incentives involvement in changes to 
terms and conditions of employment performance reviews 
organisational changes and physical working environment 
improvements a new ocado council registrar was appointed 
in the period
in november 2011 ocado signed a voluntary union 
recognition agreement with the trade union union of shop 
distributive and allied w orkers “usdaw” in relation 
to our hourly paid employees including our personal 
shoppers cstms and lgv drivers  this means that usdaw 
representatives will participate on the ocado council to 
voice the views of our hourly paid employees on matters 
relating to pay holiday entitlements and working hours
developing our people
every employee plays a part in the company’s success and 
we are focused on developing our people to the best of their 
abilities  when joining the business employees undertake a 
thorough induction which includes training related to their 
role and orientation around different areas of the business
ocado’s people have a range of skills and experience  w e 
work hard to provide opportunities to move around the 
business where appropriate and provide training to develop 
skills for current and future roles  our inhouse training team 
deliver customer focused training that prioritises the health 
and safety of our people and meets individual needs  w e 
have created and rolledout a new management development 
programme which gives our employees the opportunity 
to progress their careers  w e have also implemented new 
appraisal processes and succession plans
attracting talent
w e rely on talented people with drive and dedication to 
deliver excellent customer service  this is why we are careful 
to recruit the right people for the right roles  our graduate 
programme plays an important part in developing talented 
people for our future and our careers website and online 
applicant tracker system allows timely recruitment of talented 
people for business growth
ocado jobs
during the period the average number of employees 
employed by the group increased significantly to 5180 
employees excluding agency workers 2010 4252 
diversity of our people
w e are committed to equal opportunities for all of 
our people regardless of disability or background from 
recruitment and selection through training and development 
and promotion  w e value diversity and through our equal 
opportunities policy we are dedicated to creating an 
environment that is free from discrimination harassment and 
victimisation where everyone is treated equally regardless of 
age colour disability race sexual orientation marital status 
political views or religious belief
it is the policy of the group that applications for employment by 
disabled persons are always fully considered bearing in mind the 
respective aptitudes and abilities of the applicant concerned  in 
the event of employees becoming disabled all reasonable effort 
is made to ensure that their employment within the group 
continues  it is the policy of the group that the training career 
development and promotion of a disabled person should as far 
as possible be identical to that of an able bodied person
social and community issues
charitable donations
in 2010 ocado established a charity committee made up 
of eight employees which increased to twelve employees in 
april 2011  the chosen charity for the period was macmillan 
cancer support which was elected by ocado employees 
though the annual employee survey described above  
during the period the charity committee organised a number 
of events including quiz nights a summer charity ball a cake 
sale and christmas raffle 27 stock code ocdo wwwocadogroupcom
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corporate social responsibility report  
 
ocado employees raised almost £29000 for a number of 
charities  including  macmillan cancer support £24056
donated  the british heart foundation £2770 donated 
and made donations under £2000 to the nspcc and the 
japan appeal 
in addition to the money raised by its employees ocado 
made charitable donations during the period of £29250 
2010 £14000 which includes £20000 to peace winds 
described below £5000 sponsorship of a visit from lech 
w alesa the former first president of poland for migrant at 
home magazine as well as donations of less than £2000 
to peace one day  ctt   credit action the pwc p artners 
charity w alk and various charity events  some of these 
charitable initiatives are described below
japan appeal ocado established an appeal to raise money for 
a japanese charity called peace winds who were helping over 
300000 people affected by the japan tsunami and earthquake 
and subsequent fukushima power plant evacuation in march 
2011 by providing emergency food and blankets  ocado 
appealed to its customers and staff for donations and 
promised to match the first £20000 raised  the ocado 
appeal raised over £250000 for peace winds 
peace one day peace one day is a nonprofit organisation 
which has established a ceasefire and nonviolence day that 
occurs on 21 september each year  they are committed to 
raising global awareness of the “peace day” through education 
and encouraging the global community to take action  ocado 
is supporting this organisation by funding peace one day’s 
“uk citizenship resource pack” for secondary schools ocado 
funded a full time “outreach coordinator” for three months 
to help schools use these resources which were delivered to 
31500 students  in the next year ocado intends to support 
the creation by peace one day of a new resource for 
primary school children
christmas food donations each christmas ocado donates 
food for hampers to charities helping impoverished 
communities across the country  in the period ocado 
donated food to dens a charity based in hemel hempstead 
shoc based in reading and action for children in bristol 
rewrap ocado is currently producing canvas tote bags 
for customers with rewrap  rewrap is a notforprofit 
organisation which works with disadvantaged families in india 
who produce the bags  the materials used are sustainable 
and recycled textiles and ecofriendly dyes  rewrap are also 
a member of the w orld fair t rade organisation  by working 
with rewrap ocado is helping to sustain disadvantaged 
families in india retaining traditional indian craft and 
supporting fair trade practices
jami ocado donated a significant number of desktop 
computers to the registered mental health charity jami  
the desktop computers were being replaced as part of the 
upgrades to the ocado customer call centre 
the group also donates money to the w aitrose foundation 
and the prince’s charities foundation as noted above
political donations
no political donations were made by the group to any 
political party organisation or candidate during the period 
2010 nil  28
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board of directors 
  
board of directors
lord grade of yarmouth ‡
chairman
lord grade joined the board as 
chairman in 2006  he has had a long 
and distinguished career in broadcasting 
encompassing itv  bbc and over nine 
years as chief executive of channel 
4 t elevision  he is currently a non
executive director at wrg w orldwide 
limited the chairman of pinewood 
shepperton plc and also chairman 
of james grant group limited  he 
was appointed a member of the press 
complaints commission limited in 
april 2011 in november 2010 a 
peerage of the united kingdom for life 
was conferred upon michael  
tim steiner
chief executive officer
tim is a founding director  he has 
responsibility for keeping a general 
oversight of the business and strategy 
prior to ocado tim spent eight years 
as a banker at goldman sachs  during 
his time there he was based in london 
hong kong and new york in the fixed 
income division  tim graduated from 
manchester university with an honours 
degree in economics finance and 
accountancy in 1992
neill abrams 
legal and business affairs 
director
neill has been a director since 
september 2000 having previously 
advised ocado since its founding  he is 
responsible for ocado’s business support 
including legal insurance risk management 
and human resources divisions  prior to 
ocado neill was a barrister in practice 
at one essex court and an executive 
director and counsel at goldman sachs 
in london  neill graduated from sidney 
sussex college cambridge with a 
masters degree in law in 1989 having 
previously obtained ba and llb degrees 
from the university of the witwatersrand 
in johannesburg  he is also admitted as 
a member of the new york bar and as a 
south african advocate
david grigson  ‡
nonexecutive director and 
senior independent director 
david joined the board in march 
2010  he is the board’s senior 
independent director and chairman of 
the nomination committee  he has 
held a number of posts including chief 
financial officer at reuters group plc 
group finance director at emap plc 
chairman of emap digital limited and 
nonexecutive director of carphone 
w arehouse plc  he is currently a non
executive director at standard life plc 
and  t rinity mirror plc and is chairman 
of creston plc  david is a member of 
the chartered accountants of england 
and w ales and studied economics at the 
university of manchester 
ruth anderson  † ‡
nonexecutive director
ruth joined the board in march 2010 
she is chairman of the audit committee  
until april 2009 she was a vicechairman 
of kpmg in the uk  she joined kpmg in 
1976 and became a partner in 1989  she 
has worked extensively as an adviser with 
uk and international businesses ruth is a 
nonexecutive director of t ravis perkins 
plc and the royal p arks an executive 
agency of the department of culture 
media and sport  ruth is a fellow of 
the institute of chartered accountants 
of england and w ales and a member of 
the chartered institute of taxation  ruth 
graduated from bradford university with 
an honours degree in french and spanish
robert gorrie  † ‡
nonexecutive director
robert joined the board in 2000 as 
the logistics director  in may 2006 he 
became a nonexecutive director  prior 
to ocado he was group director of 
information t echnology at t ranspor t 
development group plc where he 
spent ten years in a variety of commercial 
and operational roles  prior to that he 
spent ten years in north america with 
the logistics service business christian 
salvesen plc where he reached 
the position of director of business 
development  robert graduated from 
corpus christi college oxford with an 
honours degree in modern history and 
economics 29 stock code ocdo wwwocadogroupcom
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our responsibilities our performance
board of directors  
 
david y oung cbe  † ‡
nonexecutive director
david joined the board in 2000 with 
the initial investment in ocado by 
john lewis  he is the chairman of 
the remuneration committee  david 
was a member of the board at john 
lewis between 1982 and 2002 where 
he was finance director and later 
appointed as deputy chairman  having 
held a number of senior positions he 
is currently the t reasurer of sheffield 
university  david read ppe at corpus 
christi college oxford  david will be 
leaving the board after the agm on 23 
may 2012 
jörn rausing † ‡
nonexecutive director
jörn joined the board in 2003 with 
the initial investment by apple t rust 
now the apple ii t rust of which he 
is a beneficiary in ocado  he is a 
nonexecutive member of the t etra 
laval group board and a member 
of the boards of alfa laval ab and 
delaval holdings ab   jörn is also 
t etra laval group’s head of mergers 
and acquisitions  he holds a degree 
in business administration from lund 
university sweden 
douglas mccallum † ‡
nonexecutive director 
douglas mccallum joined the board 
in october 2011  doug has been a 
pioneer of the internet industry for 
17 years for the last ten years at ebay 
where he led the uk business and 
then turned around the paneuropean 
business  prior to ebay he was founder 
and general manager of a number of 
businesses in the internet broadcasting 
software and hardware industries  
douglas read ppe at the university of 
oxford and has an mba from harvard 
business school
 audit committee     † remuneration committee    ‡ nomination committee
andrew bracey
chief financial officer
andrew joined the board as chief 
financial officer in november 2009 
having previously advised ocado since 
its commencement  prior to ocado 
he had an 18year career in investment 
banking at jefferies international at 
barclays capital as managing director 
of principal investments where he 
undertook a number of consumer and 
retail investments including somerfield as 
managing director in investment banking 
at credit suisse and at ubs  he studied 
history of architecture at magdalene 
college cambridge having previously 
obtained a ba from the university of east 
anglia  andrew notified the company in 
january 2012 that he intended to resign 
from the board will be leaving after the 
publication of this annual report
jason gissing 
commercial director 
jason is a founding director he has 
board responsibility for ocado’s retail 
activities including buyer supplier and 
customer relationships marketing and 
brand development  in addition jason 
leads ocado’s green initiatives  prior 
to ocado jason spent eight years as a 
banker at goldman sachs  he graduated 
from w orcester college oxford with an 
honours degree in jurisprudence in 1992
mark richardson
operations director 
mark joined the board in january 
2012 having been ocado’s head 
of t echnology since 2001  he is 
responsible for the daytoday running 
of the ocado operation including 
customer fulfilment centres logistics 
developments business planning 
engineering and it   prior to ocado 
mark was at the john lewis p artnership 
where he held a number of it positions 
including head of selling systems 
at w aitrose  mark graduated from 
university college london with a 
physics degree 30
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
statement of corporate governance  
  
statement of corporate governance
introduction
the following sections explain how the company applies the 
main principles set out in the uk corporate governance 
code june 2010 issued by the financial reporting council 
the “2010 code” as required by the listing rules of 
the financial services authority and meets the relevant 
information provisions of the disclosure and t ransparency 
rules of the financial services authority  this statement of 
corporate governance covers the following
 z the role of the board 
 z the board’s effectiveness 
 z the board’s committees 
 z the group’s risk management and internal control 
framework and
 z relations with the company’s shareholders and the agm 
the company has applied the principles and complied with 
the provisions of the 2010 code during the period save as 
described below  where the company has not complied 
the reasons for noncompliance are stated including the 
period where it has not complied if relevant and the 
relevant provisions in the 2010 code recognising that it is 
a newly listed company with its admission on 26 july 2010 
the board has the goal of moving the company towards full 
compliance with all provisions of the 2010 code as swiftly as 
practicable  the company will continue to put in place new 
governance arrangements in order to meet that objective
further information on the 2010 code can be found at 
wwwfrcorguk
this separate statement of corporate governance forms 
part of the directors’ report as required by the disclosure 
and t ransparency rule 721 and accordingly is approved 
by the board and signed on behalf of the board by a 
director  certain parts of this statement of corporate 
governance have been reviewed by the company’s auditors 
pricewaterhousecoopers llp  for compliance with the 2010 
code to the extent required as mandated by listing rule 
9810r2
for the chairman’s statement on the company’s corporate 
governance see the chairman’s letter on page 3
the board
the company is led by the board  the names responsibilities 
and details of the current as at the date of this annual 
report directors on the board are set out in the board of 
directors section on pages 28 to 29 during the period and 
following period end there were a number of changes to the 
board both on the executive and the nonexecutive sides  
mark richardson was appointed to the board on 
23 january 2012 to a newly created board role of operations 
director  mark was previously ocado’s head of t echnology  
he is now responsible for the daytoday running of the 
ocado operation including customer fulfilment centres 
logistics developments business planning engineering and 
it   at this time jason gissing one of the cofounders of the 
business and current executive director and neill abrams 
current executive director and legal and business affairs 
director assumed changed executive responsibilities  jason 
assumed the new board position of commercial director 
responsible for ocado’s retail activities including buying 
supplier and customer relationships marketing and brand 
development neill assumed responsibility for hr which was 
previously part of jason’s former role 
the company appointed three nonexecutive directors 
to the board  douglas mccallum joined the board on               
3 october 2011 as a nonexecutive director  w endy becker 
was appointed to the board as a nonexecutive director 
such appointment to take effect on 30 march 2012  on 
14 march 2012 the company announced the appointment 
of alex mahon as a new nonexecutive director such 
appointment to commence on 1 june 2012
the company announced on 23 january 2012 that executive 
director and chief financial officer andrew bracey had 
tendered his resignation from the board and that he was 
expected to leave following publication of this annual report  
andrew bracey will join michael p age international plc as its 
new chief financial officer  a formal process to identify his 
successor is ongoing
the company also announced on 23 january 2012 the 
retirement of david young a nonexecutive director from 
the board such retirement to take effect on 23 may 2012 
being the date of the company’s agm 
the nonexecutive director p atrick lewis resigned from 
the board effective on 15 february 2011  as stated in the 
company’s prospectus dated 6 july 2010 the john lewis 
pension fund agreed with the company that p atrick lewis 
a nonexecutive director originally appointed to the board 
in october 2009 by the john lewis p ension fund would 
step down from the board if the john lewis p ension fund’s 
holding of ordinary shares in ocado fell below 10 per cent of 
the issued ordinary share capital of the company  on 
11 february 2011 the company announced that the john 
lewis p ension fund had sold its entire shareholding in the 
company   accordingly p atrick lewis resigned from the 
board as agreed
  31 stock code ocdo wwwocadogroupcom
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statement of corporate governance  
 
director election
the rules that the company has about the appointment and 
replacement of directors are described in the directors’ 
report on pages 56 to 57
in order to maintain high standards of corporate governance 
the articles require each director to retire at every annual 
general meeting each director may offer himself or herself 
for reappointment by the members at such meeting  the 
directors current at that time were reelected at the 
last annual general meeting on 11 may 2011  each current 
director including the appointed directors noted above will 
seek reelection by shareholders at the company’s agm on  
23 may 2012 except andrew bracey who has tendered his 
resignation david young who will retire as nonexecutive 
director and therefore will not be seeking reelection and 
alex mahon whose appointment is effective on 1 june 2012  
a biography of each current director as at the date of this 
annual report is set out in the board of directors section on 
pages 28 to 29
chief executive officer
the company’s chief executive officer is tim steiner  his 
biographical details are set out on page 28
the chairman
lord grade joined the board as an independent non
executive director and chairman in 2006 his biographical 
details are set out on page 28 and indicate the chairman’s 
significant time commitments outside of the company 
during the period these other commitments changed with 
lord grade’s appointments as director of wrg w orldwide 
limited a creative agency and as a member of the press 
complaints commission limited 
division of responsibilities between chairman 
and chief executive officer
there is a clearly established and longstanding division 
of responsibilities between the chairman and the chief 
executive officer which is set out in writing and has been 
approved by the board  the chairman is responsible for 
leadership of the board and ensuring its effectiveness lord 
grade was responsible during the period for influencing the 
direction of the board’s agenda and ensuring that adequate 
time was allocated to discussing agenda items including the 
most material business matters such as strategy 
the chief executive officer is responsible for the daytoday 
management operations and results of the group executing 
the strategy once agreed by the board and making proposals 
to the board for the strategic development of the group  
he creates a framework of strategy values organisation and 
objectives to ensure the successful delivery of results and 
allocates decision making and responsibilities accordingly  he 
takes a leading role with the chairman in the relationship 
with all external parties and in promoting the company
senior independent director
david grigson who joined the board as an independent 
nonexecutive director in february 2010 is the board’s 
senior independent director  his biographical details are set 
out on page 28  the senior independent director’s role is to 
provide a sounding board for the chairman and to serve an 
intermediary for the other directors when necessary  the 
senior independent director is available to shareholders 
of the company to assist in resolving concerns of such 
shareholders
independence
the 2010 code recommends that at least half of the board 
of directors of a uk listed company excluding the chairman 
should comprise nonexecutive directors determined by the 
board to be independent in character and judgement and 
free from relationships or circumstances which may affect or 
could appear to affect the director’s judgement  
the board as at the date of this annual report comprises 
12 members  the directors expect that at the time that 
the various board appointments and resignations outlined 
above take effect the board will comprise 13 members 
including the chairman five independent nonexecutive 
directors five executive directors and two nonexecutive 
directors who are not deemed to be independent for 
the purposes of the 2010 code  the company does not 
therefore comply with the relevant requirements of the 2010 
code provision b11 in relation to the balance of executive 
and independent nonexecutive directors 
the company expects that as existing members of the 
board step down and new directors are appointed the 
company will become compliant with the 2010 code in this 
respect the board believes that providing some continuity of 
leadership is important and therefore has taken a measured 
approach to transforming the board to one that is compliant 
with the independence requirements of the 2010 code in 
due course the recomposed board including the director 
appointees will comprise eight nonexecutive directors of 
which the chairman david grigson ruth anderson douglas 
mccallum w endy becker and alex mahon are deemed 
independent as defined in the 2010 code  however in 
respect of the other nonexecutive directors
 z robert gorrie is not deemed independent for the 
purposes of the 2010 code because he was an 
executive director of ocado from april 2000 until april 
2006 and has been a nonexecutive director since may 
2006  he also provides consulting services to the group 
under a separate consulting agreement and acts as 
chairman of the ocado council and
 z jörn rausing is not deemed independent for the 
purposes of the 2010 code because the apple ii t rust 
of which he is a beneficiary is a major shareholder of 
the company  32
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
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statement of corporate governance  
  
statement of corporate governance continued
nonexecutive directors
the nonexecutive directors have wide and varied skills 
and commercial experience which they bring to the 
deliberations of the board and the board committees as 
well as their independent judgment on group strategy risk 
and performance  the board considers that its size and 
composition and that its balance of skills and experience is 
appropriate for the requirements of the business
 
the chairman seeks to ensure the effective contribution 
of the nonexecutive directors and constructive relations 
between the nonexecutive directors and the executive 
directors particularly during discussions at board meetings 
at the board’s strategy conference held in june 2011 the 
board discussed the group’s mediumterm and longterm 
plans and objectives the nonexecutive directors debated 
such proposals presented by management and provided 
input to help develop these plans such constructive debates 
on group strategy are considered by the directors to 
be beneficial in that they assist the company to focus its 
efforts and planning in the most effective areas for delivering 
business growth and to balance the risks associated with 
those changes 
as required under the 2010 code each nonexecutive 
director’s letter of appointment to the board sets out clearly 
the expected time commitment from them to the company 
and at the time of appointment the relevant nonexecutive 
director confirmed that that he or she is able to devote 
sufficient time as is necessary to the performance of his 
or her duties  the board is satisfied that each of the non
executive directors has sufficient time available to devote to 
the company 
the terms and conditions of appointment of the non
executive directors are available for inspection at the 
company’s registered office during normal business hours 
and at the company’s agm
the board’s role
the board is collectively responsible for the longterm 
success of the company  subject to the articles the 
companies act and any directions given by special resolution 
the business of the company will be managed by the board 
who may exercise all of the powers of the company 
the board has a number of key responsibilities and formally 
reserved powers as set out in the schedule of matters 
reserved for the board  the board has responsibility for 
the overall management of the group and for setting and 
reviewing the group’s longterm objectives and commercial 
strategy including determination of the nature and extent 
of the significant risks that the board is willing to take to 
implement its commercial strategy  the board has oversight 
of the group’s operations including management and 
planning sound risk management and internal control systems 
adequate accounting and other records and compliance 
with statutory and regulatory obligations  other reserved 
matters include approval of the annual report and halfyearly 
report the group’s budgets the authority levels for capital 
expenditure the treasury policy and any governance policies 
the board’s role also includes oversight of the group’s capital 
structure including any share issues and share buy backs the 
directors report on pages 60 to 61 includes a description 
of the powers of the directors to issue and buy back the 
company’s shares 
during the period the board’s activities included
 z receiving reports from senior management on trading 
business performance financing and operational projects 
 z receiving progress reports from senior management on 
the construction of cfc2 and on the development of 
capacity projects in cfc1 
 z approving the annual budget and the business plan for 
the group 
 z reviewing and approving the group’s results 
announcements the annual report and notice of 
meeting 
 z receiving reports on and discussing various business 
development and strategic opportunities 
 z receiving reports on and discussing the group’s 
marketing and procurement strategy and development 
of the customer offer 
 z receiving update reports on health and safety investor 
relations and legal and company secretary matters 
 z receiving reports from the chairman of each of the 
audit committee the nomination committee and the 
remuneration committee 
 z discussing risk management and internal control and 
reviewing the group’s risk matrix
 z discussing succession plans and board recomposition 
 z approving new governance policies including the group’s 
antibribery policy and
 z approving various new share scheme issues including a 
second issue under the group’s jsos scheme and a new 
share incentive plan 
in addition the board convened its strategy conference at 
which the board discussed the group’s medium and long 
term strategy and plans  various papers were presented by 
senior management to the board on potential projects for 
the growth of the business in future  some of these plans 
were prioritised by the board and were progressed over 
the period including the group’s expansion of its nonfood 
product range 
the board delegates to management the detailed 
implementation of matters approved by the board and 
the daytoday operational aspects of the business  the 
executive directors and the management committee meet 
twice weekly to review operational performance and to 
monitor implementation of certain projects  a project team 
meets frequently to monitor progress of development of 
the cfc2 project  management has authority to undertake 
capital expenditure without board approval up to certain 
preapproved expenditure thresholds and above which the 
expenditure must be elevated to the board for approval 33 stock code ocdo wwwocadogroupcom
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statement of corporate governance  
 
the board delegates certain responsibilities to its principal 
committees namely the audit committee the remuneration 
committee and the nomination committee the committees 
keep the full board apprised of their work and refer matters 
requiring resolution to the full board for approval as 
appropriate  the audit committee monitors the integrity 
of financial information and reviews the effectiveness of 
the financial controls and the internal control and risk 
management systems  the remuneration committee 
sets the remuneration policy for executive directors and 
determines their individual remuneration arrangements  the 
nomination committee recommends the appointment of 
directors and has responsibility for evaluating the balance of 
the board and for succession planning at board level  further 
details concerning the committees of the board are set out 
below as required by disclosure and t ransparency rules 727 
and 728 and the 2010 code  
attendance
the table below shows the attendance of the directors 
during the period at scheduled board and board committee 
meetings during the period  the board had scheduled 11 
board meetings during the period and convened three 
additional ad hoc board meetings  the composition of two 
of the board committees changed during the period as 
described in the board committee’s description set out below 
hence some members of the committees did not attend all 
of the relevant committee meetings during the period
board of directors¹ audit committee remuneration committee nomination committee
  actual possible actual possible actual possible actual possible
executive directors
tim steiner 14 14      
neill abrams 14 14      
andrew bracey 14 14      
jason gissing 13 14      
nonexecutive directors²
lord grade 
chairman 14 14     3 3
david grigson 12 14 5 5   3 3
david y oung 13 14 5 5 3 3 3 3
jörn rausing 11 14   2 3 2 3
ruth anderson 14 14 5 5 3 3 3 3
robert gorrie 14 14 5 5 3 3 3 3
douglas mccallum³ 2 2   1 1  
former directors
patrick lewis
4
2 3      
notes 
¹ as noted above various directors have joined the board since the end of the period namely mark richardson w endy becker and alex mahon and so are not listed in the attendance table 
²  jörn rausing david grigson and p atrick lewis did not attend the board meeting on 4 february 2011 as the date of board meeting had been changed at short notice and these directors already had 
prior commitments 
³ douglas mccallum joined the board of the company on 3 october 2011 
4
 patrick lewis resigned from the board of the company effective on 15 february 2011  34
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
statement of corporate governance
  
statement of corporate governance continued
information and professional development
the chairman is responsible for ensuring that all directors 
are properly briefed on issues arising at board meetings and 
that they have full and timely access to relevant information  
the quality and supply of information provided to the board 
was reviewed as part of the board evaluation exercise noted 
below
 
nonexecutive directors appointed to the board during the 
period participated in an induction programme including a 
cfc1 visit work in cfc1 as a personal shopper and making 
deliveries accompanying a cstm on a delivery route  the 
induction also includes meetings with members of senior 
management and receipt of an induction booklet comprising 
the group’s key board and governance documents and policies 
the board received reports and presentations from some 
members of senior management from timetotime which 
help maintain the nonexecutive directors’ understanding 
of the business and the sector and maintain their links to the 
remainder of the business on matters such as the nonfood 
business plan cfc2 planning and progress and succession 
planning  during the period a board meeting was held 
at cfc1  this allowed the nonexecutive directors the 
opportunity to see the development testing or operation 
of various new capital projects at cfc1  a board meeting is 
scheduled to be held at cfc2 in 2012  
the need for director training is assessed by the chairman 
from timetotime  the company secretary neill abrams 
arranged for newly appointed directors to receive 
information and a presentation on the duties and obligations 
of a listed company director  t raining for directors is available 
via various external advisers to the company on an ongoing 
basis to meet any particular needs  following the end of 
the period the nonexecutive directors were invited to 
join a nonexecutive director network group which provides 
access to knowhow on current issues relevant to the role of 
company director  members of the audit committee receive 
written knowhow and technical updates from the company’s 
auditors pricewaterhousecoopers llp   to keep them abreast 
of the latest accounting auditing and tax developments 
the committees have access to sufficient resources to 
discharge their duties as required by the 2010 code  in 
this regard remuneration consultants had advised the 
remuneration committee on executive remuneration 
during the period  the company retained the services of 
professional services consultants for the recruitment of new 
directors  members of the board may take independent 
professional advice at the company’s expense in the 
furtherance of their duties
company secretary
the board is assisted by the company secretary who is also 
the legal and business affairs director neill abrams who 
reports to the chairman in respect of his core secretarial 
duties to the board  all directors have access to the advice 
and services of the company secretary  he has responsibility 
for ensuring that board procedures are followed and for 
governance matters the company secretary under the 
direction of the chairman was responsible for ensuring good 
information flows within the board and its committees as 
required under the 2010 code  the appointment and removal 
of the company secretary is one of the matters reserved for 
the board
conflicts of interests
the companies act provides that directors must avoid a 
situation where they have or can have a direct or indirect 
interest that conflicts or possibly may conflict with a 
company’s interests  directors of public companies may 
authorise conflicts and potential conflicts where appropriate 
if a company’s articles of association permit
each nonexecutive director’s letter of appointment 
sets out the requirement for disclosing conflicts to the 
chairman and the company secretary  as part of his or her 
induction process a newly appointed director completes a 
questionnaire which requires them to disclose any conflicts of 
interests to the company  no director has declared to the 
company any actual or potential conflicts of interest between 
any of his duties to the company and his private interests 
andor other duties except in the case of an executive 
director who holds the position of director of the company 
and director of a number of group subsidiary companies
whenever a director takes on additional external 
responsibilities the board considers any potential conflicts 
that may arise  the board will continue to monitor and 
review potential conflicts of interest on a regular basis
director insurance and indemnities
the company maintains directors’ and officers’ liability 
insurance cover for its directors and officers as permitted 
under the company’s articles and the companies act  
such insurance policies were renewed during the period 
and remain in force  the company also indemnifies the 
directors under an indemnity deed with each director which 
contains provisions that are permitted by the director liability 
provisions of the companies act and the company’s articles  
an indemnity deed is usually entered into by a director at 
the time of their appointment to the board qualifying third 
party indemnity provisions as defined by section 234 of the 
companies act were in force during the period and remain 
in force for the benefit of the directors and any officer of 
the company or of any associated company 35 stock code ocdo wwwocadogroupcom
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our responsibilities our performance
statement of corporate governance  
 
board performance evaluation
the effectiveness of the board is important to the success 
of the group and accordingly the board considers that 
reviewing its own performance is helpful  
during the period each of the executive directors was 
subject to a full performance evaluation from each other the 
management committee and the nonexecutive directors 
in addition the board carried out a board evaluation in 
which all of the then current directors participated except 
those noted below   this evaluation covered the board the 
remuneration committee the nomination committee the 
audit committee and each of the nonexecutive directors 
individually and was designed to assess how well they 
were performing collectively and individually and how their 
performance could be improved
these evaluations were based on a written questionnaire 
customised by the company secretary with support from an 
external consultant independent audit limited  the board 
evaluation questionnaire covered the following key areas 
strategy leadership and accountability board effectiveness 
quality of information presented to the board board culture 
risk governance and interaction with management  each 
board committee questionnaire sought to evaluate that 
committee’s performance in fulfilling its functions and key 
responsibilities as set out in the relevant committee’s terms of 
reference  the questionnaires were issue based with scoring 
but the directors were encouraged to expand on their 
scoring and assessments with additional comments including 
with respect to areas for improvement 
the findings of the evaluations were reviewed by the company 
secretary and the chairman and a report summarising the 
findings was provided to each director   the board discussed the 
board evaluation report noting areas for improving effectiveness 
in future  the chairman separately reviewed the individual non
executive director performance evaluation reports
in addition the findings of the board committee evaluations 
were reviewed by the company secretary and each 
committee chairman and a report summarising the findings 
was delivered to each committee  the committees will use 
these evaluation findings as the basis for formulating plans 
for improving their effectiveness in future  t he r emuneration 
committee recommended that individual performance reviews 
form a formal part of the criteria taken into account in the 
executive director remuneration 
the chairman and the nonexecutive directors met without 
the executive directors being present as required by the 
2010 code to discuss the performance of the board and the 
executive directors  the senior independent director and 
the nonexecutive directors also met without the executive 
directors or the chairman being present as required by the 
2010 code and subsequently met with the chairman to 
provide feedback
the explanatory notes set out in the notice of meeting 
for the agm state the reasons that the board believes 
each director proposed for reelection at the agm 
should be reappointed  the board has based in part its 
recommendations for reelection on its review of the results 
from the board evaluation process and the chairman’s 
review of individual evaluations which concluded that each 
director’s performance continues to be effective and that 
each director has demonstrated substantial commitment to 
the role including time for board and committee meetings 
and other responsibilities
various directors did not participate in the board evaluation 
process but are standing for reelection at the agm  douglas 
mccallum joined the board close to the period end and 
two directors namely mark richardson and w endy becker 
joined or expressed their intention to join the board after 
the end of the period consequently the board based its 
recommendation to reelect these directors on the same 
reasoned principles and judgments it applied in appointing 
the directors to the board at that time  finally alex mahon 
who will join the board after the agm on 23 may 2012 is 
expected to stand for reelection at the 2013 annual general 
meeting 
during the period the board agreed to conduct a board 
evaluation process facilitated by an independent third party in 
a future period as required by the 2010 code the directors 
considered that such review would be more valuable to the 
board at a later point at which the recomposed board had 
had sufficient time to settle given the significant changes to 
its makeup during the period and intended changes in the 
shortterm  36
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2106604 08022012 proof 1
statement of corporate governance 
  
statement of corporate governance continued
board committees
as envisaged by the 2010 code the board has established 
three board committees the nomination committee the 
remuneration committee and the audit committee  the 
chairman of each committee provides a report or update 
of each meeting of the respective committee to the board 
at the subsequent board meeting  the committees are 
described in more detail below as required by disclosure and 
t ransparency rules 715 727 and 728 and the 2010 code 
nomination 
committee
the nomination committee’s principal responsibility is to 
keep the composition and balance of the board under review 
consider succession planning lead the process for board 
appointments and make recommendations to the board 
on all new appointments and reappointments of directors 
the nomination committee also makes recommendations 
for the membership of the audit committee and the 
remuneration committee 
during the period the nomination committee met primarily 
to discuss the composition of the board and the recruitment 
of new nonexecutive directors to help with the company’s 
objective of moving the composition of the board towards 
compliance with the 2010 code  subsequent to period end 
it met to discuss the appointment of two new nonexecutive 
directors and the process for the recruitment of a new chief 
financial officer of the group
meetings the nomination committee meets when 
necessary and will normally meet no fewer than twice a year  
the nomination committee met three times during the 
period  
members and chairman the nomination committee is 
chaired by the senior independent director david grigson 
and all of the other nonexecutive directors including the 
chairman are members of the nomination committee  the 
composition of the nomination committee changed during 
the period with the appointment of douglas mccallum 
effective on 3 october 2011 and will change subsequent 
to period end with the appointments of w endy becker and 
alex mahon
independence the 2010 code requires that a majority of 
members of a nomination committee be independent non
executive directors  
the nomination committee as at the date of this annual 
report comprises seven members  the directors expect 
that at the time that the various board appointments and 
resignations noted above take effect the nomination 
committee will comprise eight members including the 
chairman five independent nonexecutive directors and 
two nonexecutive directors who are not deemed to be 
independent for the purposes of the 2010 code  accordingly 
the company will comply with the relevant requirements of 
the 2010 code
nonexecutive director appointments the company had 
previously stated its objective to rebalance the board in 
favour of nonexecutive directors who are considered 
independent under the 2010 code  the nomination 
committee’s work has resulted in the recruitment of three 
new independent nonexecutive directors namely douglas 
mccallum w endy becker and alex mahon
in each case of nonexecutive director appointment the 
process was led by the chairman of the nomination committee  
professional services consultants lygon group and the zygos 
partnership were instructed by the chairman of the nomination 
committee in connection with separate recruitment processes  
in each case the nomination committee considered the skills 
knowledge background and experience required for the role 
of the nonexecutive director and prepared a job specification 
for the role   a number of directors including the chairman of 
the nomination committee the chairman the chief executive 
officer and other directors interviewed numerous candidates 
for each role of nonexecutive director  the nomination 
committee also specified the time commitment expected of the 
role and confirmed with candidates that each had sufficient time 
available to devote to the role  following extensive searches 
the chairman of the nomination committee made separate 
recommendations to the board to appoint as independent 
nonexecutive director douglas mccallum w endy becker 
and alex mahon  as noted above the appointments of w endy 
becker and of alex mahon to the board were made following 
the period end  37 stock code ocdo wwwocadogroupcom
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executive director appointments  the nomination 
committee’s and board’s deliberations during the period 
included a discussion about the size and composition of 
the executive director team the board felt that additional 
executive support for the chief executive officer would be 
needed in overseeing the group’s operations  consequently 
in january 2011 the board approved the appointment of 
mark richardson  previously head of t echnology and a 
longstanding member of the management committee to the 
position of operations director  this new executive director 
role means that mark richardson has taken responsibility 
for the daytoday technical and operating side of the 
business and in turn allows the chief executive officer to 
spend additional time on the group’s strategy and growth 
plans  this appointment was also significant in that it was the 
group’s first internal promotion to executive director level 
following the announcement on 23 january 2012 that 
executive director and the chief financial officer andrew 
bracey had indicated that he intended to resign from the 
board the nomination committee commenced a formal 
process to identify his successor  this recruitment process 
which is being conducted by tim steiner and the company’s 
director of human resources under the oversight of the 
nomination committee is ongoing as at the date of this 
annual report 
reviewing board composition  the nomination committee 
will continue to meet regularly to consider the board size 
and composition and to ensure that plans are in place for the 
orderly succession of appointments to the board including 
executive director roles 
the company will continue to seek to recruit new 
nonexecutive directors so that the board meets the 
independence requirements of the 2010 code  given the 
large number of changes to the board in the past 12 months 
the nomination committee has decided to allow some time 
for the current board composition to settle before making 
further appointments
as part of this process the nomination committee expects 
to reassess in due course the current balance of skills and 
experience of the recomposed board with the aim that it 
will highlight areas of skill and experience that could be filled 
by any new board appointees in future  
diversity in considering the size and composition of the 
board the nomination committee had taken account of 
various factors including skills experience and diversity of 
the existing board  the nomination committee remained 
conscious of the need to address the diversity of the board 
including gender diversity as part of its plan to recruit new 
nonexecutive directors  as noted above both of the most 
recent appointments to the board are women 
terms of reference as described above the nomination 
committee has reviewed its own performance and terms 
of reference to ensure it is operating effectively and has 
recommended any changes it considers necessary to 
the board for approval  as a result amendments to the 
nomination committee’s terms of reference were made and 
approved by the board 
the nomination committee’s revised terms of reference are 
available on the website wwwocadogroupcomcorporate
responsibilitycorporategovernanceaspx and set out the 
nomination committee’s responsibilities
david grigson
chairman of the nomination committee 38
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role the role of the remuneration committee is to 
determine and recommend to the board the remuneration 
policy for the chairman of the board the executive directors 
and the company secretary  this includes base salary annual 
and longterm incentive entitlements and awards and pension 
arrangements  in determining the remuneration policy 
the remuneration committee takes into account many 
factors including the need for a significant proportion of the 
executive directors’ remuneration to be structured so as 
to link rewards to business and individual performance as 
required by the 2010 code
members and chairman as at the date of this annual report 
the remuneration committee is chaired by david young and 
its other members are ruth anderson robert gorrie jörn 
rausing and douglas mccallum  the composition of the 
remuneration committee changed during the period with 
the appointment of douglas mccallum to the remuneration 
committee effective on 3 october 2011 and will change 
subsequent to period end with the appointment of  w endy 
becker to the remuneration committee effective 31 march 
2012  effective immediately following the company’s agm 
w endy becker will assume the role of remuneration 
committee chairman when the current chairman david 
young retires from the board 
the director of human resources  the chief executive 
officer and company secretariat attended some or all of the 
remuneration committee meetings during the period
independence the 2010 code requires a board to establish 
a remuneration committee of at least three members all of 
whom must be independent nonexecutive directors  
the remuneration committee as at the date of this annual 
report comprises five members the directors expect 
that at the time that the various board appointments and 
resignations outlined above take effect the remuneration 
committee will be recomposed and include three 
independent nonexecutive directors ruth anderson 
douglas mccallum and w endy becker and two non
executive directors who are not deemed to be independent 
for the purposes of the 2010 code   accordingly the 
company does not comply with the relevant requirements 
of the 2010 code in relation to the membership of the 
remuneration committee  
meetings the remuneration committee will normally meet 
no fewer than two times a year during the period the 
remuneration committee met on three occasions
duties the remuneration committee’s key duties as set out 
in its terms of reference are as follows
 z determine and agree with the board the framework or 
broad policy for the remuneration including pension 
of the company’s chief executive officer the chairman 
the executive directors and the company secretary 
including the need for a significant proportion of 
executive directors’ remuneration to be structured so as 
to link rewards to corporate and individual performance
 z review the ongoing appropriateness and relevance of the 
remuneration policy
 z approve the design of and determine targets for any 
performance related schemes for executive directors 
operated by the group ensuring that the performance 
related elements of executive directors’ remuneration 
are stretching and designed to promote the longterm 
success of the company and the group and annual 
payments made under such schemes  in designing such 
schemes the remuneration committee should follow 
the provisions in schedule a to the 2010 code
 z review the design of all new longterm schemes as 
defined in listing rule lr 94 and significant changes to 
such schemes for approval in each case by the board 
and shareholders save in the circumstances permitted 
by the listing rules  for any such schemes determine 
each year whether awards will be made and if so the 
overall amount of such awards and the individual awards 
to the executive directors and the company secretary
 z ensure that contractual terms on termination and 
any payments made are fair to the individual and the 
company or the relevant member of the group as 
applicable that failure is not rewarded and that the duty 
to mitigate loss is fully recognised  
 z within the terms of the agreed policy and in consultation 
with the chairman andor the chief executive officer as 
appropriate determine the total individual remuneration 
package of each executive director the company 
secretary and the chairman including bonuses incentive 
payments share options or other share awards and any 
compensation payments 
 z in determining such packages and arrangements give due 
regard to any relevant legal requirements the provisions 
and recommendations in the 2010 code and the listing 
rules and associated guidance
 z review and note annually the remuneration trends across 
the group the remuneration committee should also 
monitor the level and structure of remuneration for 
senior management
 z oversee any major changes in employee benefits 
structures throughout the company or the group
 z review the policy for authorising claims for expenses 
from the chief executive officer and the chairman
 z ensure that all provisions regarding disclosure of 
remuneration including pensions are fulfilled
remuneration 
committee 39 stock code ocdo wwwocadogroupcom
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 z be responsible for establishing the selection criteria 
selecting appointing and setting the terms of reference 
for any remuneration consultants who advise the 
remuneration committee and
 z obtain reliable uptodate information about 
remuneration in other companies with a view to judging 
where to position the company relative to other 
companies  the remuneration committee shall have full 
authority to commission any reports or surveys which it 
deems necessary to help it fulfil its obligations
principal activities of the remuneration committee in line
with its terms of reference the following key matters were
considered by the remuneration committee during the
period and in some cases shortly after period end
 z approval of the 2010 directors’ remuneration report
 z appointing and receiving a report from remuneration 
consultants concerning the executive director 
remuneration and advice on the 2011 annual incentive 
plan
 z implementation of the 2011 annual incentive plan 
including consideration of the design selection of 
performance targets and finalising the plan rules
 z review of performance under the 2011 annual incentive 
plan and consideration of any bonuses payable
 z consideration of the 2012 annual incentive plan
 z review of the design and scope of proposed new share 
schemes for all employees including a share incentive 
plan and the second share issue under the jsos scheme
 z receiving a report from management on executive 
director remuneration benchmarking
 z consulting the chief executive officer on performance 
and remuneration of the executive directors
 z receiving a report on groupwide and management 
remuneration for 2011 and 2012
 z undertaking a tender process for the appointment of 
a new remuneration consultant to advise in respect of 
2012 onwards
 z oversight of the proposed new management committee 
contracts
 z review of the remuneration committee’s performance 
and
 z review of and proposed amendment to the terms of 
reference
directors’ remuneration report the remuneration committee 
has produced the directors’ remuneration report see pages 
46 to 55 and will put it to the company’s shareholders for 
consideration at the agm on 23 may 2012
external advice the remuneration committee appointed 
and received advice during the period from remuneration 
consultants towers perrin now towers w atson on certain 
remuneration issues   the remuneration committee is 
satisfied that there is no connection between the company 
and t owers w atson  
in addition the company received advice from bdo llp 
who provided tax advice slaughter and may who provided 
tax and schemes advice and appleby t rust jersey limited 
who advised on the employee benefit trust in connection 
with the implementation of the group’s second issue of 
shares under the jsos scheme 
since the period end the remuneration committee 
had undertaken a competitive tender process for the 
appointment of new remuneration consultants to advise 
the remuneration committee   this process which 
had involved the input from the chief executive officer 
resulted in the appointment of the remuneration advisers 
deloitte llp   deloitte llp have been appointed by the 
remuneration committee as its independent adviser such 
appointment to commence after the date of this annual 
report  the remuneration committee is satisfied that there 
is no connection between the company and deloitte llp   
deloitte llp confirmed to the company that it is a member 
of the remuneration consultants group and as such 
operates under the code of conduct in relation to executive 
remuneration consulting in the uk 
in addition to the external advice received the remuneration 
committee consulted and received reports from the 
company’s chief executive officer  the director of human 
resources and the deputy company secretary 
terms of reference as described above the remuneration 
committee has reviewed its own performance and terms 
of reference to ensure it is operating effectively and has 
recommended any changes it considers necessary to 
the board for approval  as a result amendments to the 
remuneration committee’s terms of reference were made 
and approved by the board 
the remuneration committee’s revised terms of reference 
are available on the website wwwocadogroupcom
corporateresponsibilitycorporategovernanceaspx and set 
out the remuneration committee’s responsibilities
david y oung
chairman of the remuneration committee 40
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statement of corporate governance continued
audit 
committee
role of the audit committee the audit committee is primarily 
responsible for
 z monitoring the integrity of the financial statements of the 
company and the financial reporting process
 z monitoring the effectiveness of the company’s internal 
financial controls and its internal control and risk 
management systems
 z reviewing the audit plans of the external auditors and for 
monitoring the conduct of the audit
 z reviewing the effectiveness independence and objectivity 
of the auditors and monitoring the company’s policy 
on the engagement of the auditors to supply nonaudit 
services 
 z monitoring the need for an internal audit function and
 z making recommendations to the board for a resolution 
to be put to shareholders of the company in relation 
to the appointment and remuneration of the external 
auditors 
the audit committee’s full terms of reference which set 
out the above responsibilities are available on the corporate 
website wwwocadogroupcomcorporateresponsibility
corporategovernanceaspx
the following section describes the work of the audit 
committee in discharging these responsibilities 
composition of the audit committee the audit committee 
is chaired by ruth anderson and its other members are 
david grigson david young and robert gorrie  as required 
by the 2010 code ruth anderson and david grigson are 
considered by the board to have competence in accounting 
andor auditing and recent and relevant financial experience  
the biography of each member of the audit committee is 
set out on pages 28 and 29
the composition of the audit committee did not change 
during the period  the audit committee’s makeup will 
change effective on 1 june 2012 when new nonexecutive 
director  alex mahon joins the board and becomes a 
member of the audit committee  
independence  the 2010 code requires a board to establish 
an audit committee of at least three independent non
executive directors  from the perspective of the 2010 code 
only two of the four members of the audit committee ruth 
anderson and david grigson are independent  therefore 
the company does not comply with the 2010 code in this 
respect  when alex mahon joins the audit committee 
and david young retires from the board three of the four 
members of the audit committee will meet the 2010 code 
definition of an independent nonexecutive director  
meetings and attendance the audit committee held five 
meetings during the period to coincide with the company’s 
reporting timetable  attendance at the meetings is shown 
on page 33   the chief financial officer andrew bracey 
and senior members of the finance department company 
secretariat and the auditors regularly attended the audit 
committee meetings during the period
the audit committee met with the auditors during the 
period to discuss their remit and any issues arising from 
the audit without management being present  the audit 
committee also met with the group’s finance executives 
without the auditors present
the external auditors had meetings with the chairman of the 
audit committee without the company’s finance executives 
present
principal activities of the audit committee 
the audit committee undertook a number of principal 
activities during the period as described below
financial statements and reporting the audit committee 
reviewed the group’s financial statements including prior to 
the period end a review of the significant financial reporting 
issues estimates and judgements  the board and the audit 
committee have reviewed the narrative reporting for this 
annual report and accounts as well as the half year report 
and accounts  in addition the board reviewed prior to 
publication the various interim management statements and 
trading statements made by the company
the audit committee and the full board reviewed the basis 
for preparing the group consolidated financial statements on 
a going concern basis including in particular the assumptions 
underlying the going concern statement and the associated 
risk factor disclosures  the audit committee’s review 
included consideration of the reports produced by the 
company in connection with the audit work 41 stock code ocdo wwwocadogroupcom
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internal controls and risk management the audit committee 
received regular reports from management on the 
company’s risk management plans and processes  the 
company’s internal control and risk management systems are 
described in more detail below
the audit committee also received and considered reports 
during the period on the work under taken by the auditors 
pricewaterhousecoopers llp  in reviewing and auditing the 
group’s control environment and reviewing the financial 
reporting procedures which the audit committee took 
into account in assessing the quality and effectiveness of the 
group’s systems of internal control 
internal audit the group does not have a dedicated internal 
audit function  the audit committee considered the need 
for an internal audit function as required by the 2010 code 
provision c35 and concluded that given the group’s 
current stage of development and existing monitoring 
and internal control measures it was not necessary  the 
audit committee was satisfied that management had 
given sufficient assurances that other monitoring processes 
including internal reviews of the group’s operations 
undertaken periodically by senior finance staff were being 
applied and would be developed using the existing expertise 
of the finance department to help ensure that the group’s 
system of internal control was functioning as intended the 
board accepted the audit committee’s recommendation 
to not establish an internal audit function  the need for 
an internal audit function will be monitored by the audit 
committee and subject to an annual review in 2012 
whistle blowing and fraud the audit committee receives an 
update at each of its meetings from management on whether 
there have been any frauds or improprieties including those 
raised through the company’s whistle blowing procedures 
the company’s whistle blowing procedure which allows the 
company’s employees to report concerns anonymously is 
set out in the employee handbook  no instances brought to 
the attention of the audit committee during the period were 
viewed as material in the context of the group however 
as a result of such reporting measures were considered 
by the audit committee and taken by the company to 
improve certain internal controls including physical security 
procedures at some of its sites 
bribery act  in july 2011 the bribery act 2010 came into 
force consequently the board approved an antibribery 
policy which sets out the company’s approach to dealing 
with bribery and corruption and provides guidance for 
employees on when gifts and hospitality given or received 
during the course of employment are acceptable or 
prohibited  the audit committee receives a report at each 
of its meetings concerning the gifts and hospitality register 
which was established during the period and any issues 
of noncompliance with the antibribery policy  the audit 
committee will continue to monitor compliance with the 
policy and the company’s procedures for the prevention of 
bribery and will review the effectiveness of the policy in due 
course  the audit committee’s terms of reference were 
amended to reflect this expanded remit 
review of responsibilities   the audit committee has reviewed 
its own performance and terms of reference to ensure it 
is operating effectively and has recommended any changes 
to the terms of reference it considers necessary to the 
board for approval as a result amendments to the audit 
committee’s terms of reference were made and approved by 
the board 
external auditors
the audit committee’s work during the period included 
oversight of the engagement of the external auditors  
pricewaterhousecoopers llp 
auditors’ independence the 2010 code requires that the 
board establish formal arrangements for maintaining an 
appropriate relationship with its auditors and to explain how 
the auditors objectivity and independence is maintained 
during the period the audit committee developed and 
implemented the company’s policy which restricts the 
engagement of its auditors in relation to nonaudit services 
to help ensure that the provision of nonaudit services by 
the company’s auditors does not have an impact on their 
independence and objectivity  the policy applies the guidance 
set out in the guidance on audit committees issued by the 
financial reporting council in december 2010 
the majority of the nonaudit work undertaken by the 
company’s auditors pricewaterhousecoopers llp  during 
the period was i the review of the company’s halfyear 
accounts and ii tax and accounting advice provided in 
relation to the company’s establishment of a subsidiary 
entity in poland and associated work  given the auditors’ 
knowledge in these areas and the relatively small engagement 
fees concerned it was concluded that it was in the interests 
of the company to utilise the services of the auditors 
rather than another third party provider for the nonaudit 
work  the total of nonaudit fees and audit fees paid to 
pricewaterhousecoopers llp during the period is set out in 
the note 213 to the consolidated financial statements  42
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pricewaterhousecoopers llp also follows its own ethical 
guidelines and the auditing practices board’s ethical standard 
5 – nonaudit services provided to audited entities and 
continually reviews its audit team to ensure its independence 
is not compromised
the audit committee is satisfied that notwithstanding the 
company’s auditors pricewaterhousecoopers llp had 
provided nonaudit services to the group during the period 
the quantum of such nonaudit fees relative to the audit fees 
together with the other measures taken by the company 
and the auditors to safeguard independence mean that 
pricewaterhousecoopers llp’s independence from the 
group was not compromised in the circumstances
auditors’ reappointment and remuneration in relation to 
considering the reappointment and remuneration of the 
auditors pricewaterhousecoopers llp  the audit committee 
in line with the company’s policy on auditors reappointment
 z reviewed the proposed terms of engagement and the 
proposed audit fees for the previous audit 
 z evaluated the effectiveness and performance of the 
pricewaterhousecoopers llp audit team on the 
previous audit as noted above and 
 z made certain assessments about auditors independence 
noted above and received assurances from 
pricewaterhousecoopers llp regarding their ongoing 
independence 
the audit committee was also satisfied as to the adequacy of 
the previous audit plan and that the level of audit fees payable 
in respect of the audit services provided was appropriate and 
that an effective audit could be conducted for such a fee 
on the basis of this review of the previous audit the audit 
committee recommended to the board the reappointment 
of pricewaterhousecoopers llp as auditors to the company 
and that the remuneration and terms of engagement of 
pricewaterhousecoopers llp as auditors to the company 
be approved as required by the 2010 code  the board 
accepted these recommendations and proposals will be 
put to the shareholders at the agm on 23 may 2012 that 
pricewaterhousecoopers llp be reappointed as auditors 
of the company and that the directors be authorised to 
determine the level of the auditors’ remuneration  the 
existing authority for the directors including the audit 
committee to determine the current remuneration of the 
auditors is derived from the shareholder approval granted at 
the company’s annual general meeting in 2011 
the audit committee discussed during the period the 
requirements of the apb ethical standards for auditors for 
the rotation of audit partners  the audit committee has 
monitored the auditors’ compliance with this requirement as 
set out in the company’s auditors appointment policy which 
reflects the guidance laid out in the guidance on audit 
committees published by the financial reporting council 
in december 2010 and confirms that the policy has been 
complied with  as a result the audit partner will rotate after 
the date of this annual report  
internal control
overview  the board has oversight of the system of internal 
controls for the group and for reviewing the effectiveness 
of such a system  certain of these responsibilities have 
been delegated to the audit committee which reports to 
the board  management is responsible for implementing 
and maintaining the necessary internal control systems and 
processes
review the audit committee has in the period reviewed the 
effectiveness of the company’s system of internal controls 
including financial operational and compliance controls and risk 
management systems  as noted above its review had included 
consideration of reports prepared during the period by the 
company’s auditors  neither the audit committee’s nor 
the board’s deliberations concerning internal control have 
included a detailed consideration of the ‘t urnbull guidance’ 
internal control revised guidance for directors on the 
combined code october 2005 issued by the financial 
reporting council for reviewing the effectiveness of internal 
control  there is an ongoing process for identifying evaluating 
and managing the risks faced by the group and the operational 
effectiveness of the related controls  a system of internal 
controls has been in place during the period up to the date 
of approval of this annual report  t he a udit committee is 
satisfied that the controls in place are appropriate  however 
it is mindful that the internal control system is designed to 
manage rather than eliminate risk in order to achieve the 
group’s strategy and business objectives and so can only 
provide reasonable and not absolute assurance against loss
it controls  since its admission in july 2010 the company 
has continued to make improvements to the group’s system 
of internal controls to address issues raised in the full year 
external assessments including upgrades to the financial 
systems and strengthening of the finance team  an important 
area of internal control for the group is information 
technology “it” controls and governance  the audit 
committee discussed during the period placing additional 
attention on formalising it governance structures to respond 
to the changes in the group’s risk environment which result 
from the growth and increasing complexity of both the it 
function and the group  in addition the audit committee 
determined that further work is needed to refine the risk 
management and control processes used by the group in 
undertaking it system upgrades given the large number of 
it changes made to the group’s systems during the period 
several of which resulted in significant albeit very shortterm  43 stock code ocdo wwwocadogroupcom
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disruption to the group’s operations during the period  the 
group’s director of t echnology will report at future audit 
committee meetings on the progress made to formalise the 
group’s it governance structures 
main features of system  the following lists the main features 
of the group’s internal control and risk management systems 
including those relating to the financial reporting process and 
process for preparing the group’s consolidated accounts
 z an organisational structure with clear segregation of 
duties control and authority
 z comprehensive management information systems for 
providing management with financial and operational 
performance measurement indicators each week  this 
information is summarised monthly and reviewed by the 
board
 z formal budgeting and reforecasting processes variances 
from budget and forecasts are monitored and any 
significant differences are explained to the board by 
management at each board meeting
 z a capital approval policy that controls the group’s capital 
expenditure that restricts what can be undertaken 
without executive director or board approval
 z monitoring the progress of major projects including 
the cfc2 project by management and the executive 
directors and by the board
 z a review of key accounting policies by the audit 
committee each period 
 z monitoring by the audit committee of the integrity 
of the financial statements and the financial reporting 
process discussed above 
 z monitoring by the audit committee of the effectiveness 
of the company’s internal financial controls
 z a risk committee which will report to the audit 
committee that will seek to implement risk control 
processes and embed risk analysis as part of normal 
business decisionmaking discussed below
 z a review of reports on any whistle blowing fraudulent 
activity or bribery by employees by the audit committee 
each period 
 z an it security committee that monitors the group’s it 
security measures
 z a treasury policy overseen by the treasury committee 
that manages financial risk including liquidity and controls 
the group’s cash and deposits investments foreign 
exchange and interest rates outlined in more detail 
below and
 z other control measures outlined elsewhere in this 
audit committee report and in the principal risks and 
uncertainties section 
treasury the group’s treasury committee reports 
periodically to the audit committee on its activities  these 
reports cover various matters set out in the group’s treasury 
policy concerning the group’s cash and deposits investments 
foreign exchange and applicable interest rates  during the 
period the treasury committee monitored the group’s 
working capital existing treasury deposits and reinvestment 
options for certain bank deposits and oversaw the hedging 
of the group’s exposure to movements in interest rates and 
currency in relation to cfc2 
the treasury policy and treasury committee headed by 
the director of finance and risk forms part of the group’s 
measures for financial risk management  the treasury 
committee’s objectives are to minimise the risks associated 
with treasury management to ensure sufficient liquidity to 
meet the group’s long and short term requirements to 
minimise financing costs and to maximise investment returns 
as well as ensuring compliance with relevant regulatory and 
legal obligations  the group’s policies and strategies for 
managing financial risk to the extent material to assess the 
financial performance or position of the group are discussed 
in note 45 to the consolidated financial statements and in 
the principal risks and uncertainties description as set out on 
page 21
after the period end the treasury committee undertook a 
review of the treasury policy which it does from timetotime 
and made recommendations to the audit committee which 
were considered and discussed by the audit committee 
statement of corporate governance 
  44
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statement of corporate governance continued
risk management
the board accepts that risk is an inherent part of the 
business  the group’s risk management system is designed 
to identify key risks and provide assurance that these risks 
are fully understood and managed within the context of the 
company seeking to achieve its strategic objectives 
as noted above the board must maintain and have oversight 
of the company’s risk management and internal control 
system  the 2010 code provides that the board should 
at least annually conduct a review of the effectiveness of 
ocado’s risk management systems  while the disclosure 
and t ransparency rules require that the audit committee 
must monitor the effectiveness of ocado’s risk management 
systems 
risk committee management is responsible for implementing 
and maintaining the necessary risk management and internal 
control systems and processes  to help management 
undertake this role following review and discussion by 
the audit committee during the period the company 
established a risk committee  the risk committee is not a 
board committee but rather is comprised of members of 
senior management and the head of risk management and 
is chaired by an executive director the legal and business 
affairs director  it will report to the audit committee and 
the board on its responsibilities in order to help them fulfil 
their duties and responsibilities the risk committee had its 
first two meetings after the period end  
the duties of the risk committee are set out in its terms of 
reference and include monitoring the company’s overall risk 
assessment processes that inform the board’s decision making 
and developing implementing testing and reviewing internal 
control mechanisms and disaster recovery planning for the 
group 
the intention is that in conjunction with the company’s 
head of risk management the risk committee will continue 
to develop and refine the group’s risk register which is a 
comprehensive register of all risks known to management 
that affect the business of the group 
the risk register will be reviewed by the risk committee as a 
whole with the aim of identifying the key operational risks for 
the group and developing a coordinated crossdepartmental 
approach to improving control measures for the most 
significant business risks
during the period the board and the audit committee 
received reports from management concerning risk 
management  the audit committee reviewed the risk 
register focusing on the process for compiling the risk register 
at an operational level including the mitigating controls and 
risk ratings applied 
in the context of reviewing the annual budget the board 
considered the key operational risks to the group achieving 
its budget targets for the forthcoming period  in addition the 
board discussed from timetotime during the period some 
of the significant external risks impacting the business as set 
out in the principal risks and uncertainties section of this 
annual report   
the audit committee received a report at most of its 
meetings during the period concerning the steps being 
taken by management to implement a more formal and 
comprehensive risk management system for the group  as 
part of its discussions the audit committee though not 
the full board as required by the 2010 code provision 
c21 considered during the period the effectiveness 
of the group’s existing risk management framework and 
the recommendations made by management for evolving 
that framework  as a result of such review one of the key 
outcomes was the establishment of the risk committee as 
noted above 
ruth anderson
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investor relations
the company is committed to maintaining constructive 
communications with its shareholders  normal shareholder 
contact is the responsibility of the chief executive officer 
tim steiner the chief financial officer andrew bracey 
and the head of investor relations  the chairman and the 
senior independent director are available to the company’s 
shareholders to discuss any of their concerns and the larger 
shareholders were offered the opportunity to meet with 
the chairman during the period  the chairman met with 
shareholders during the period the senior independent 
director also met with a large shareholder of the company 
during the period
the company regularly meets with its large investors and 
institutional shareholders who along with analysts are invited 
to presentations by the company immediately after the 
announcement of the company’s results  the chairman 
will usually attend such presentations by the company  the 
board regularly receives feedback from the company’s 
brokers and the executive directors on the views of major 
shareholders and the investor relations programme and also 
receives reports at each board meeting on the main changes 
to the composition of the company’s share register  one 
of the company’s largest shareholders the apple ii t rust has 
jörn rausing who is a beneficiary of that trust as a director 
on the board 
all shareholders can access the annual report 
trading statements investor presentations and regular 
announcements on the company’s corporate website www
ocadogroupcom  all shareholders can choose to receive an 
annual report in paper or electronic form
the company’s agm
shareholders will have the opportunity to meet and question 
the board at the agm  the agm of ocado group plc will 
be held at 1100 am on 23 may 2012 at one bunhill row 
london ec1y 8yy 
a detailed explanation of each item of business to be 
considered at the agm is included with the notice of 
meeting which will be sent to shareholders before the agm 
to allow for maximum shareholder input the company 
offers electronic proxy voting and voting through the crest 
electronic proxy appointment service  the board proposes 
that all resolutions proposed at the agm will be taken 
on a poll vote  this follows best practice guidelines and 
enables the company to count all votes not just those of 
shareholders who attend the meeting  the company expects 
that the chairman will announce the provisional voting results 
at the meeting  the final voting results will be announced 
by the company immediately following the agm via the 
regulatory news service and will also be available on the 
company’s corporate website wwwocadogroupcom
share capital voting rights and significant 
shareholders
details concerning the company’s share capital significant 
shareholders special rights voting rights and other matters 
required by the disclosure and t ransparency rule 72 are set 
out in the directors’ report on pages 57 to 62
going concern and business model
the company’s going concern statement and certain 
related matters required by listing rule 98 are set out in 
the directors’ report on page 64  for an explanation of the 
company’s business model as required by the 2010 code 
see the directors’ report on page 63   46
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
directors’ remuneration report
  
 
introduction
this directors’ remuneration report prepared by the 
remuneration committee on behalf of the board has been 
drawn up in accordance with the 2010 code schedule 8 
of the large and mediumsized companies and groups 
accounts and reports regulations 2008 the listing rules 
and the disclosure and t ransparency rules
this directors’ remuneration report has been approved by 
both the remuneration committee and by the board and 
a resolution to approve the report will be proposed at the 
agm of the company on 23 may 2012
the relevant regulations require that a company’s 
auditors report on the ‘audited information’ in a directors’ 
remuneration report and to state that this section has been 
properly prepared in accordance with these regulations for 
this reason this directors’ remuneration report is divided 
into part a containing the unaudited information and part 
b containing the audited information  the company’s 
auditors pricewaterhousecoopers llp   have reviewed part b 
of this directors’ remuneration report 
 
part a unaudited information
 
a remuneration committee 
role and operations the remuneration committee’s role 
and duties together with other information regarding the 
operation of the remuneration committee are described in 
the statement of corporate governance on pages 38 to 39 
and is incorporated into this directors’ remuneration report 
by reference
b remuneration policy
policy outline  the company’s current remuneration policy for 
the executive directors is to provide remuneration packages 
for executive directors and other senior executive managers 
in the group which
 z align management’s interests with those of shareholders 
by incentivising management to deliver the group’s long
term strategy and enhance shareholder value
 z provide management with the opportunity to earn 
competitive remuneration through variable based pay
 z provide rewards comparable with those of other similar 
companies to the group and
 z enable the group to attract and retain management 
of the calibre required to run the business and drive 
shareholder value creation
any director who is appointed to any executive office shall 
be entitled to receive such remuneration whether by way 
of salary commission participation in profits or otherwise as 
the board or any committee authorised by the board may 
decide either in addition to or in lieu of their remuneration 
as a director  in addition any director who performs 
services which in the opinion of the board or any committee 
authorised by the board go beyond the ordinary duties of a 
director may be paid such extra remuneration as the board 
or any committee authorised by the board may determine  
each director may be paid their reasonable travelling hotel 
and incidental expenses of attending and returning from 
meetings of the board or committees of the board or of 
the company or any other meeting which as a director 
they are entitled to attend and shall be paid all other costs 
and expenses properly and reasonably incurred by them in 
the conduct of the company’s business or in the discharge 
of their duties as a director  the company may also fund 
a director’s or former director’s expenditure and that of 
a director or former director of any holding company 
of the company for the purposes permitted under the 
companies act and may do anything to enable a director 
or former director or a director or former director of any 
holding company of the company to avoid incurring such 
expenditure as provided in the companies act
the board or any committee authorised by the board may 
exercise the powers of the company to provide benefits by 
the payment of gratuities or pensions or by insurance or in 
any other manner for any director or former director or 
their relations dependants or persons connected to him but 
no benefits except those provided for by the articles may 
be granted to or in respect of a director or former director 
who has not been employed by or held an executive office 
under the company or any of its subsidiary undertakings 
or their respective predecessors in business without the 
approval of an ordinary resolution of the company
performancerelated versus fixed remuneration  it is the 
company’s policy that a substantial proportion of the 
executive directors’ remuneration should be variable and 
performance related in order to encourage and reward 
superior business performance and shareholder returns and 
that remuneration should be linked to both individual and 
company performance  
employee share schemes currently the company’s
remuneration policy for executive directors is that a relatively
large proportion of the executive directors’ remuneration be
linked to their shareholding in the jsos incentive scheme for
the purposes of listing rule 98810 the company’s current 
policy is that all employees including executive directors are 
issued options under the esos shortly after commencing 
employment with the group the company does not have 
an arrangement for the annual issue of options or shares to 
executive directors under the existing employee share schemes 
namely esos and jsos schemes exceptionally additional 
options may be granted to senior employees but not executive 
directors under the esos from timetotime the company 
does not have any other longterm incentive schemes
directors’ remuneration report 47 stock code ocdo wwwocadogroupcom
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review of remuneration policy  since the end of the 
period the remuneration committee has appointed new 
external remuneration advisers deloitte llp   to advise the 
remuneration committee  the mandate which is expected 
to commence after the date of this annual report will entail 
the review of the company’s existing remuneration policies 
and the development of a strategy and policy for executive 
director remuneration for the mediumterm  the outcomes 
of this review will be reported to the remuneration 
committee in due course  in the meantime the company’s 
existing remuneration policy outlined in this directors’ 
remuneration report will continue to apply 
executive director remuneration  the current remuneration 
of the executive directors consists of the following elements 
which are outlined in more detail in this report 
 z base pa y
 z bonus pay under the annual incentive plan
 z pension 
 z incentivisation under the jsos share scheme as well 
other groupwide share schemes namely esos and 
sharesave scheme and
 z various other benefits including groupwide employee 
benefits 
this broad remuneration framework did not change from 
the previous period except for the introduction of a formal 
bonus plan instead of a discretionary bonus plan 
the remuneration committee considers that these 
components in aggregate ensure that there is sufficient 
balance between reward for shortterm success and long
term growth of the group 
nonexecutive director remuneration  the nonexecutive 
directors’ remuneration consists of a director fee including 
in the case of each board committee chairman an additional 
fee for chairing a board committee  their remuneration 
does not include bonus payments options or shares  the 
remuneration policy for nonexecutive directors did not 
change during the period 
base pay
basic salary for executive directors takes into account the 
individual’s experience roles responsibilities and performance 
this is normally reviewed annually unless their responsibilities 
change  for an executive director the remuneration committee 
considers base salary and increases based on the median level paid 
for comparable roles within the market and the ftse 250
one of the remuneration committee’s duties is to review and 
note annually remuneration trends across the group  following 
the end of the period the remuneration committee received 
a report from management on the group’s current framework 
for pay share schemes and other employee benefits for senior 
management and the group generally and management’s 
proposals for changes to these in the subsequent period  the 
remuneration committee took this information into account in 
making its recommendations on executive director base pay 
changes in base pay  the base pay for executive directors did 
not change over the course of the period and has not increased 
since december 2009  the remuneration committee made 
this recommendation on the basis of a number of factors 
having first consulted the chief executive officer  in light of 
the lower than forecast trading performance of the business 
and the operational problems faced by the business during the 
period the remuneration committee felt that keeping base pay 
unchanged  for the time being was commensurate with such 
lower than targeted performance and more in keeping with the 
remuneration trends within the group which saw moderate 
increases during the period 
the base pay of executive directors will be subject to further 
review in the subsequent period as part of the review to be 
undertaken by the new remuneration advisers 
director fees  each of the directors shall be paid a fee at such 
rate as may from timetotime be determined by the board 
but the aggregate of all such fees so paid to the directors 
shall not exceed £1 million per annum or such higher amount 
as may from time to time be decided by ordinary resolution 
of the company  the executive directors are not currently 
paid any fees on account of holding an office
nonexecutive directors  the board determines the 
remuneration of the nonexecutive directors within the 
limits set in the company’s articles noted above  the board 
considers that the remuneration for nonexecutive directors 
reflects the time commitment and responsibilities of the role 
the fees paid to nonexecutive directors during the period 
are set out in the remuneration table in part b of this report  
annual incentive plan
as foreshadowed in the last annual report the remuneration 
committee approved that a new executive director annual 
incentive plan be put in place for the period 
the new annual incentive plan was designed to include 
performance targets that were very closely aligned with the 
company’s expected financial results and the company’s 
strategy  the 2011 financial performance measures related 
to the group’s sales growth and ebitda for the period  a 
smaller but meaningful proportion of the overall bonus was 
tied to a strategic target concerning the achievement of 
certain budget and timing milestones for the cfc2 project 
the remuneration committee in setting such performance 
targets sought to ensure that there was a balance between 
achieving the company’s shorterterm objective of delivering 
the financial projections for 2011 and the company’s critical 
strategic objective of growing the business in the medium
term by expanding capacity with the development of cfc2 
it was anticipated that these targets would encourage and 
incentivise management to deliver the group’s business 
priorities and so help to keep them aligned with the interests 
of the company’s shareholders  48
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
directors’ remuneration report
  
 
the annual incentive plan requires the group to achieve 
stretching targets in order for the executive directors to be 
eligible to be paid the maximum bonus being a percentage 
of salary 100 or below as applicable  bonus payments if 
made are payable in cash shortly after the approval of this 
annual report 
the annual incentive plan requires that the remuneration 
committee take into account the performance of the group 
and the performance of the individual executive directors to 
determine the amount to be awarded each year  
bonus payments for the period on the recommendation 
of the remuneration committee there were no bonus 
payments made to the company’s executive directors under 
the 2011 annual incentive plan  the annual incentive plan 
for the period stipulated that if the group did not achieve 
positive earnings before tax for the period irrespective of the 
achievement of other performance targets no bonuses would 
be paid  as this was the case  no bonuses were paid to the 
executive directors
2012 annual incentive plan following the period end the 
remuneration committee approved the implementation of 
an annual incentive plan for the executive directors applicable 
to the 2012 period  this plan broadly reflects the framework 
of the 2011 annual incentive plan  in addition to the 
performance measures related to sales growth profitability 
and strategic objectives the 2012 annual incentive plan will 
also include customer service based targets which reflects 
the company’s renewed focus on maintaining high levels of 
customer service during the 2012 period  the maximum 
bonus levels payable under the 2012 annual incentive plan are 
unchanged from those applicable in the 2011 annual incentive 
plan 
nonexecutive directors  neither the chairman nor any non
executive director were paid a bonus during the period 
director shareholding
while the company does not have a formal policy requiring 
directors to own shares in the company in keeping with 
the company’s philosophy of encouraging employee share 
ownership across the group all directors are encouraged to 
invest in the company’s shares 
the executive directors and most of the nonexecutive 
directors collectively hold a substantial shareholding in the 
company as noted below which helps to align their interests 
with those of shareholders of the company
pension
ocado contributes to the personal pension plans of its staff 
through a defined contribution group personal pension 
scheme which is administered by standard life  employer 
contributions to the scheme are a percentage of salary based 
on length of scheme membership  the group’s contributions 
on behalf of executive directors are on the same terms as for 
other employees  all the executive directors participate in the 
group’s pension plan  
the details of pension payments made in respect of the 
executive directors are set out in the table in p art b of this 
report 
c share plans
the group currently operates three employee share 
incentive schemes described below  the executive directors 
participate in all of these share schemes 
further information on the group’s share schemes can be 
found in note 47 to the consolidated financial statements
the remuneration arrangements for nonexecutive directors 
do not include share options or shares  however at the 
period end date a nonexecutive director robert gorrie 
held share options in the company which were granted 
to him while he held the position of executive director of 
the company  these options expired since period end and 
therefore are no longer capable of being exercised 
esos 
the ocado 2001 executive share option scheme “esos” is 
the group’s share option scheme approved by hmrc which 
was established by ocado in 2001  options may also be granted 
under the terms of a schedule which is not approved by hmrc
the employees who are eligible to participate in the esos 
are all the executive directors and employees including the 
officers and employees of ocado’s subsidiaries  
in the case of directors no grant of options shall be made to 
them without the consent of the remuneration committee 
as provided in the esos rules  the number of any options 
granted to directors is set by the remuneration committee  
all executive directors participate in the esos  details of 
their holdings in the esos are set out below  no options 
under the esos were granted to directors during the period 
the remuneration committee does not as at the date of 
this report have any intention of making an award of options 
under the esos scheme to the executive directors  
individual award limits under the esos are discussed below 
 
jsos
the jsos is a share ownership scheme under which its 
participants and appleby t rust jersey limited  the ebt 
t rustee acquire separate beneficial interests in ordinary 
shares in the company
the jsos is intended to retain and incentivise the group’s 
executive directors the management committee and certain 
senior employees  the employees eligible to participate in 
the jsos are all bona fide employees of the company or its 
subsidiaries
the remuneration committee oversees the operation of 
the scheme and is responsible for deciding the identity of the 
participants and the number of ordinary shares that may be 
acquired by them   
directors’ remuneration report continued 49 stock code ocdo wwwocadogroupcom
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all executive directors participate in the jsos  no shares 
were issued under the jsos to the directors during the period 
details of their shareholdings in the jsos are set out below  
individual limits  while the jsos scheme rules do not specify 
limits applicable to individual participants in the scheme the 
jsos rules have overriding limits on the number of shares 
that may be allocated under the jsos  these dilution limits 
which were recommended by the remuneration committee 
and approved by the company’s shareholders at the annual 
general meeting on 11 may 2011 are consistent with those in 
the company’s other employee share schemes and within the 
guidelines of the institutional shareholders  
up to 75 of the company’s issued ordinary share capital may 
be held under the jsos  in addition the jsos is subject to the 
following limits i on any date the aggregate nominal amount 
of new ordinary shares which may be allocated under the jsos 
may not when added to the nominal amount of new ordinary 
shares allocated in the previous ten years under all employee 
share schemes of the group exceed 10 of the company’s 
issued share capital and ii on any date the aggregate nominal 
amount of new ordinary shares which may be allocated under 
the jsos may not when added to the nominal amount of new 
ordinary shares allocated in the previous ten years under the 
jsos and any other employee share scheme of the group 
established for the benefit of selected employees exceed 5 of 
the equity share capital of the company  for these purposes 
no account is taken of ordinary shares allocated prior to the 
admission of the company’s ordinary shares to the official list 
of the uk listing authority
the remuneration committee consider that these limits place 
significant constraint on the size of potential awards of shares 
to individuals including the executive directors under the 
jsos
the applicable dilution limits in paragraphs i and ii set out 
above also apply to the sharesave scheme and the esos 
sharesave scheme
the sharesave scheme is a savingsrelated share option plan 
and is approved by hmrc  under this scheme the company 
or the trustees of an employee trust may grant options over 
shares in the company to eligible employees including executive 
directors of the company or its subsidiaries  to obtain an 
option an eligible individual must agree to save a fixed monthly 
amount for three years  the amount saved will determine the 
number of shares over which the option is granted 
all executive directors participate in the sharesave scheme 
their participation commenced with options granted in october 
2010 and a savings contract period that started in december 
2010   a second invitation to employees was made under the 
sharesave scheme in february 2012  employees were offered 
the opportunity to participate at an option price which was 
discounted by 10 from the applicable market value of the 
company’s shares at the date of grant 
nonemployee share options
in addition to the options granted under the esos outlined 
above ocado had granted to certain nonemployees options to 
subscribe for either ordinary shares or convertible preference 
shares in ocado limited and following the reorganisation that 
resulted in the company becoming the holding company of the 
group in the company  options over shares in ocado limited 
were granted to andrew bracey in 2002 and 2004 well before 
he became a director in 2009  following the reorganisation that 
resulted in the company becoming the holding company of the 
group such options are now options over ordinary shares in the 
company
share ownership of directors
as outlined below all of the executive directors own shares 
in the company and collectively they have a substantial 
shareholding in the company’s issued share capital as at the 
date of this annual report 
almost all of the nonexecutive directors own shares in the 
company 
performance conditions in share schemes
jsos  the jsos was structured to incentivise the participants 
including the executive directors over the longer term by 
allowing the participant to benefit from the increase if any in 
the value of the shares above a predetermined market price 
the “hurdle price” noted in the table below  the hurdle 
prices were set by the remuneration committee interests in 
the company’ shares are granted in tranches each vesting a 
year apart with a higher hurdle rate for each tranche to reflect 
the targeted growth in the company’s share price over the 
four year period  details of this for the executive directors are 
set out in the table in part b below
as described in detail in the company’s prospectus if a 
participant leaves during the currency of the scheme he may 
lose all or part of his beneficial interest depending on the 
circumstances in which he leaves that is whether he is a “good 
leaver” “bad leaver” or “very bad leaver”  apart from these 
leaver provisions and the vesting period for each tranche there 
are no performance conditions attaching to the shares in the 
jsos
given the participants invest their own money or take a 
company loan to pay for their allocation of shares in the 
jsos except that no loan was offered to an executive 
director they stand to lose money under the jsos if the 
hurdles are not met which is unlike most other employee 
share schemes  the directors believe that the jsos helps to 
properly incentivise its senior employees and that its structure 
helps align directly their interests with those of shareholders 50
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
directors’ remuneration report
  
 
there are currently no performance conditions in existence 
in connection with the company’s other share schemes 
including the esos  
performance graph
the following graph shows the total shareholder return “tsr” 
performance of an investment of £100 in the company’s shares 
from its admission on 26 july 2010 to the end of the period 
compared with an equivalent investment in the ftse 250 index 
which was chosen because it represents a broad equity market 
index of which the company is a constituent  the tsr was 
calculated by reference to the movements in share price  the 
company has not paid a dividend in the period concerned so 
the company’s tsr does not include a dividend amount  the 
company’s tsr was calculated using a fair method 
180
160
140
120
100
80
60
40
20
0
 
 
 
 
 
 
 
 
 
 
 
ocado group plc
 
ftse 250
20072010
20092010
20112010
20012011
20032011
20052011
20072011
20092011
20112011
d service contracts
executive directors’ service contracts
ocado limited has entered into service contracts with each 
of the executive directors for the provision of services to the 
group  each of the contracts was entered into on 22 june 2010 
except in the case of mark richardson  mark richardson joined 
the board as an executive director on 23 january 2012 following 
the period end and his new service contract was entered into 
with ocado limited effective then  
the company’s executive director remuneration policy provides 
that if their service contracts are terminated without cause ocado 
limited can request that they work their notice period take a 
period of garden leave or can pay an amount in lieu of notice 
equal to one times their basic salary for the remainder of their 
notice period  these payments would be subject to deductions 
for tax and national insurance  the contracts contain restrictive 
covenants which continue for 12 months after termination  the 
contracts do not contain any specific provisions relating to a 
change of control of the business
the terms of these contracts together with the dates on which each executive director including mark richardson who did not 
serve as a director during the period was appointed by ocado limited and the company respectively are set out below
director
date of 
appointment 
by ocado 
limited
date of 
appointment 
by ocado 
group plc unexpired term months
notice 
period by 
company 
months
notice 
period by 
director 
months current age
jason gissing 02022000 09032010
 continuous employment 
until terminated 
by either party 12 6 41
tim steiner 13042000 09032010
 continuous employment 
until terminated 
by either party 12 6 42
neill abrams 08092000 10122009
 continuous employment 
until terminated 
by either party 12 6 47
andrew bracey 03112009 10122009
 continuous employment 
until terminated 
by either party 12 6 45
mark richardson 03022012 23012012
 continuous employment 
until terminated 
by either party 12 6 47
as explained in the statement of corporate governance on pages 30 to 45 the company announced on 23 january 2012 
that the company’s chief financial officer  andrew bracey resigned from the board  andrew bracey is expected to leave the 
company following the date of this annual report  
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all of the executive directors except andrew bracey have been proposed for reelection at the company’s agm
nonexecutive directors’ letters of appointment
the chairman and the nonexecutive directors do not have service contracts and were appointed to the company by letter 
of appointment  the details of each nonexecutive director appointment including those that served as a director during the 
period are set out below
director
date of 
appointment  
by ocado 
limited
date of 
appointment  
by ocado 
group plc
current 
term
notice 
period current age
robert gorrie 01042000 09032010 3 years  1 month 52 
david y oung 13102000 09032010 3 years  1 month 70 
jörn rausing 13032003 09032010 3 years  1 month 52 
lord grade 15092006 09032010 3 years  6 months 69 
david grigson 03022010 09032010 3 years  1 month 57 
ruth anderson —   09032010 3 years  1 month 58 
patrick lewis — 09032010 3 years  1 month 46 
douglas mccallum —   03102011 3 years  1 month 45 
the company appointed three nonexecutive directors to the board two of which are to take effect after period end douglas 
mccallum joined the board on 3 october 2011 as a nonexecutive director  w endy becker was appointed to the board as a 
nonexecutive director such appointment to take effect on 30 march 2012  on 14 march 2012 the company announced the 
appointment of alex mahon 38 as a new nonexecutive director such appointment to commence on 1 june 2012
the company also announced on 23 january 2012 the resignation of david young a nonexecutive director from the board 
such resignation to take effect on the 23 may 2012 being the date of the company’s agm  p atrick lewis resigned from the 
board of the company on 15 february 2011  
e directors’ interests in ordinary shares
the beneficial interests of directors serving at the end of the period were
director
ordinary
shares of 
2 pence each
27 november 
2011
ordinary
shares of 
2 pence each
28 november 
2010
tim steiner 14396400 14396400 
jason gissing 9657600 9657600 
andrew bracey 812555 812555 
robert gorrie 627900 627900 
neill abrams 360600 360600 
lord grade 329110 189110 
ruth anderson 50000 26666 
david y oung 24200 13400 
david grigson 15000 15000 
there have been no changes in the directors’ interests in the shares issued or options granted by the company and its 
subsidiaries between the end of the period and the date of this annual report except an increase in neill abrams’ shareholdings 
and decrease in his holding of options under the esos due to two exercises of options in early february 2012  these share 
options were due to expire on 6 february 2012  neill exercised 175000 options at an exercise price of 10000 pence per 
ordinary share and subsequently sold some of the resulting ordinary shares to fund the cost of exercising  this resulted in him 
holding 3354 additional ordinary shares in the company after the period end  for 90000 options 87022 ordinary shares were 
sold at a market price of 10700 pence per ordinary share  for 85000 options 84624 ordinary shares were sold at a market 
price of 10165 pence per ordinary share 
no director had an interest in any of the company’s subsidiaries at the beginning or end of the period 52
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
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in addition to the above holdings certain of the directors are discretionary beneficiaries under trusts holding ordinary shares 
of the company  the interests of these discretionary beneficiaries under their respective trusts are as follows
 
director
ordinary
shares of 
2 pence 
each
27 november
2011
ordinary
shares of 
2 pence 
each
28 november
2010
jörn rausing 62740777 59080100
tim steiner 13291200 15291200 
jason gissing 7659300 7659300
neill abrams 1100800 1100800
in addition to the above holdings caryn abrams wife of neill abrams holds 75000 ordinary shares and is a discretionary 
beneficiary of a trust holding 133100 2010 133100 ordinary shares of the company 
part b  audited information
a directors’ remuneration
the following section provides details of the remuneration pension and share interests of the directors for the 52 weeks to 
27 november 2011 and has been audited
 
salaries 
and fees
2011
£’000
benefits in
kind
1
2011
£’000
annual 
bonus
2011
£’000
t otal
2011
£’000
total
restated
2
2010
£’000
executive directors
tim steiner 350  4  0  354  574 
jason gissing 250  3  0  253  403 
andrew bracey 250  3  0  253  403 
neill abrams
5
 200  3  0  203  322 
nonexecutive directors
lord grade 100  —  —  100  200 
david grigson 62  —  —  62  37 
david y oung 48  —  —  48  37 
ruth anderson 50  —  —  50  30 
robert gorrie
3
 40  —  —  40  20 
jörn rausing
4
 40  —  —  40  — 
douglas mccallum 7  —  —  7  — 
patrick lewis 8  —  —  8  14 
total 1405  13  —  1418  2040 
1
 benefits in kind comprise private medical and life insurance
2
  total remuneration for 2010 has been restated to exclude employer’s national insurance and company pension contributions
3
 in addition to his role as a nonexecutive director robert gorrie provides consultancy services to the group and chairs the meetings of the ocado council  he provides these services through  
 robert gorrie limited of which he is the sole shareholder and is paid a per diem fee for these services  these fees are included in related party transactions with key management personnel in  
 note 54 to the consolidated financial statements
4
 in addition to his annual salary in the current period jörn rausing received £20000 relating to unpaid accrued amounts from the previous financial year
5
 in addition to his role as executive director of the company neill abrams is an alternate nonexecutive director of mr price group limited listed on the johannesburg stock exchange registration  
 number 193300441806 incorporated in the republic of south africa  the role does not involve any remuneration paid or payable to neill abrams and consequently there is nothing to disclose  
 under provision d 12 of the 2010 code 
in addition to the emoluments detailed above £130000 2010 £176000 has been charged to the income statement in 
respect of directors’ sharebased payments
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pension
total pension contributions made on behalf of directors to the defined contribution group personal pension scheme which 
is administered by standard life were as follows
 
director
2011
£’000
2010
£’000
tim steiner 28 28 
jason gissing 20 20 
neill abrams 16 16
andrew bracey 4 — 
  68 64 
b directors’ interests in share option and share ownership schemes
esos
the directors have as at period end the following options over ordinary shares in the company which they were awarded 
without payment under the group’s esos
director 
date of
issue 
27 november
2011
exercise
price £ 
28 no vember
2010
exercise
price £ exercise period 
tim steiner may05 200000  115  200000  115 160508  150515
neill abrams may02 175000  100  175000  100 070205  060212
may02 175000  150  175000  150 070205  060212
nov03 100000  090  100000  090 301106  291113
may05 100000  115  100000  115 160508  150515
andrew bracey nov09 46296  135  46296  135 161112  151119
jason gissing may05 200000  115  200000  115 160508  150515
robert gorrie may02 175000  150  175000  150 070205  060212
details of the movement in the number of share options outstanding during each period are as follows
27 november 2011 28 november 2010
 
number
of share
options
weighted
average
exercise
price £
number
of share
options
w eighted
average
exercise
price £
outstanding at the beginning of the period 1171296  122  1646296  117 
granted during the period — — — —
forfeited during the period — — 200000 115 
exercised during the period —   —  275000 096
outstanding at the end of the period 1171296  122  1171296  122 
exercisable at the end of the period 1125000  121  1125000  121 
no options were exercised by directors during the period and consequently the aggregate of gains made by directors on the 
exercise of options during the period was nil  following the period end neill abrams exercised 175000 options at an exercise 
price of 10000 pence per ordinary share as noted above  after selling 171646 ordinary shares to fund the cost of exercise 
he retained the balance of 3354 ordinary shares and therefore no proceeds from the sale of shares were payable to him in 
respect of these exercised options 
during the prior period robert gorrie exercised 2750 options before the group’s restructuring realising gains of £106000  
these options were granted to him before the commencement of his role as a nonexecutive director  the company does not 
include options in remuneration paid to nonexecutive directors
there were no options issued under the group’s esos to the directors during the period 2010 nil  54
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
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no options in the esos held by the directors lapsed during the period  however following the period end 175000 options 
held by neill abrams and 175000 options held by robert gorrie both noted in the table above were not exercised by them 
and consequently lapsed  the 46296 options held by andrew bracey will automatically lapse when he leaves the company 
following the date of this annual report 
nonemployee share options
in addition to the options over ordinary shares pursuant to the group’s esos detailed above andrew bracey has the 
following options over ordinary shares of the company
date of 
issue 
27 november 
2011
exercise 
price £ 
28 no vember 
2010
exercise 
price £ exercise period 
andrew bracey feb02 886700  090  886700  090 040202  040217
  jan04 435300  103  435300  103 030104  030118
there are no performance criteria attached to these nonemployee share options  
jsos
at the end of the period the executive directors’ interests in ordinary shares in the company pursuant to the group’s jsos 
were as follows
director date of issue 
27 no vember 
2011
hurdle 
price £ 
28 november 
2010
hurdle 
price £ exercise period 
tim steiner feb10 2513100  173  2513100  173 010111  010119
feb10 2513100  191  2513100  191 010112  010119
feb10 2513100  208  2513100  208 010113  010119
feb10 2513000  228  2513000  228 010114  010119
neill abrams feb10 1017200  173  1017200  173 010111  010119
feb10 1017200  191  1017200  191 010112  010119
feb10 1017200  208  1017200  208 010113  010119
feb10 1017100  228  1017100  228 010114  010119
andrew bracey feb10 1675400  173  1675400  173 010111  010119
feb10 1675400  191  1675400  191 010112  010119
feb10 1675400  208  1675400  208 010113  010119
feb10 1675300  228  1675300  228 010114  010119
jason gissing feb10 1675400  173  1675400  173 010111  010119
feb10 1675400  191  1675400  191 010112  010119
feb10 1675400  208  1675400  208 010113  010119
  feb10 1675300  228  1675300  228 010114  010119
of the jsos shares listed against andrew bracey in the table above 3350700 shares which have not vested under jsos 
scheme rules will lapse when andrew leaves the company following the date of this annual report
directors’ remuneration report continued 55 stock code ocdo wwwocadogroupcom
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details of the movement in the number of interests in ordinary shares in the company pursuant to the group’s jsos were as 
follows
27 november 2011 28 november 2010
 
number
of share
options
weighted
average
exercise
price £
number
of share
options
w eighted
average
exercise
price £
outstanding at the beginning of the period 27524000  200  —  — 
granted during the period — — 27524000 200
forfeited during the period — — — — 
exercised during the period — — — — 
outstanding at the end of the period 27524000  200 27524000  200 
exercisable at the end of the period 6881100  173  —  — 
for further information relating to the group’s jsos see note 471 to the consolidated financial statements
sharesave scheme
at the end of the period the executive directors’ interests in the sharesave scheme were as follows
director date of issue 
27 november 
2011
exercise 
price £ 
28 november 
2010
exercise 
price £ exercise period 
tim steiner oct10 7745  116  7745  116 011213  010614
neill abrams oct10 7745  116  7745  116 011213  010614
andrew bracey oct10 7745  116  7745  116 011213  010614
jason gissing oct10 7745  116  7745  116 011213  010614
for further information relating to the sharesave scheme see note 471 to the consolidated financial statements
share price and other option information 
the closing market price of the company’s shares as at 25 november 2011 being the last trading day in the period ending on 
27 november 2011 was 8500 pence per ordinary share 2010 15100 pence per ordinary share and the share price range 
applicable during the period was 8100 pence to 28500 pence per ordinary share 
no other directors have options over shares of the company outside one of the company’s recognised share schemes 
except for andrew bracey’s nonemployee share options noted above
approved by the board
david y oung
chairman of the remuneration committee
ocado group plc
21 march 2012 56
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
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director’s report 
  
directors’ report
directors’ report and business review
the business review sets out a comprehensive review of the 
performance of the business of the group for the 52 weeks 
ended 27 november 2011 and of future developments
the companies act requires the company to set out in 
this annual report a fair review of the business of the group 
during the 52 weeks ended 27 november 2011 including 
an analysis of the position of the group at the end of the 
period  analysis of the group’s performance using key 
performance indicators and a description of the principal risks 
and uncertainties facing the group known as the “business 
review”  the information that fulfils the business review 
requirements is set out in the our performance section on 
pages 2 to 9 the about ocado section on pages 10 to 17 
the principal risks and uncertainties description on pages 18 
to 23 the corporate social responsibility report on pages 
24 to 27 and the directors’ report set out below of this 
annual report  the business review and the directors’ report 
or parts thereof are the “management report” for the 
purposes of the disclosure and t ransparency rule 418  this 
information together with the sections of the annual report 
incorporated by reference consist of a directors’ report 
that has been drawn up and presented in accordance with 
and in reliance upon applicable english company law and the 
liabilities of the directors in connection with that report shall 
be subject to the limitations and restrictions provided by such 
law
principal activities
ocado group plc the “company” is a public limited 
company incorporated and registered in england and w ales 
under the companies act with registered number 07098618  
its registered office is titan court 3 bishops square hatfield 
business park hatfield hertfordshire al10 9ne
the company is the holding company of the ocado group 
of subsidiary companies the “group”  the principal activity 
of the company is that of a holding company  the company 
owns directly the entire issued share capital of ocado 
holdings limited which holds the entire issued share capital 
of ocado limited  the principal activities of ocado limited 
are the retailing and distribution of grocery and consumer 
goods  further information in relation to the principal 
activities of the subsidiary undertakings can be found in note 
51 to the consolidated financial statements
the group currently operates out of a dedicated cfc 
based at a site in hatfield hertfordshire together with ten 
operational spokes based in bristol coventry dartford 
leeds manchester oxfordshire which started operating after 
the end of the period southampton w eybridge white city 
and wimbledon
corporate governance
the statement of corporate governance as required by the 
disclosure and t ransparency rule 721 is set out on pages 
30 to 45 and is incorporated by reference into this directors’ 
report
risk management
the group’s procedures for managing risk are described on 
page 44 and the group’s principal risks and uncertainties 
are described on pages 18 to 23 and those descriptions are 
incorporated by reference into this directors’ report
 
the group’s policies and strategies for managing financial risk 
to the extent material to assessing the financial performance 
or position of the group are summarised in note 45 to the 
consolidated financial statements in the principal risks and 
uncertainties description as set out on page 21 and in the 
statement of corporate governance as set out on page 44 
as required by disclosure and t ransparency rules 418 and 
4111
employee involvement equal opportunities and 
disabled employees
the corporate social responsibility section on pages 25 to 26 
sets out the group’s policies on employee engagement and 
disabled employees  they are incorporated by reference into 
this directors’ report
charitable and political contributions
the particulars of the group’s charitable and political 
contributions made during the period are set out in the 
corporate social responsibility section on pages 26 to 27  
they are incorporated by reference into this directors’ 
report
board of directors
the membership of the board and biographical details of 
the directors are given in the board of directors section 
on pages 28 to 29 and are incorporated into this directors’ 
report by reference  the changes to the membership of the 
board during the period are described in the statement of 
corporate governance on pages 36 to 37
appointment and replacement of directors
the articles set out the rules applicable to the appointment 
retirement and removal of a director of the company 
described below 57 stock code ocdo wwwocadogroupcom
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directors’ report  
 
appointment of directors a director may be appointed by the 
company by ordinary resolution of the shareholders or by 
the board  a director appointed by the board holds office 
only until the next annual general meeting of the company 
and is then eligible for reappointment  the board or any 
committee authorised by the board may from timetotime 
appoint one or more directors to hold any employment or 
executive office for such period and on such terms as they 
may determine and may also revoke or terminate any such 
appointment
retirement of directors at every annual general meeting of 
the company each director shall retire from office and may 
offer himself for reappointment by the members
removal of directors by special resolution the company 
may by special resolution remove any director before the 
expiration of his period of office
vacation of office the office of a director shall be vacated 
if i he resigns or offers to resign and the board resolve to 
accept such offer ii his resignation is requested by all of the 
other directors and all of the other directors are not less 
than three in number iii he is or has been suffering from 
mental or physical illhealth and the board resolves that his 
office be vacated iv he is absent without the permission 
of the board from meetings of the board whether or not 
an alternate director appointed by him attends for six 
consecutive months and the board resolves that his office is 
vacated v he becomes bankrupt or compounds with his 
creditors generally vi he is prohibited by law from being 
a director vii he ceases to be a director by virtue of the 
companies act or viii he is removed from office pursuant 
to the articles if the office of a director is vacated for any 
reason he must cease to be a member of any committee of 
the board
directors’ interests
the directors’ beneficial interests in the shares of the 
company are shown in the directors’ remuneration report 
as set out on pages 51 to 52
directors’ indemnity
the directors’ indemnity arrangements are described in the 
statement of corporate governance as set out on page 34
amendment of the articles
the company’s articles may be amended by a special 
resolution of its shareholders
share capital
pursuant to the disclosure and t ransparency rules the listing 
rules the companies act and the large and mediumsized 
companies and groups accounts and reports regulations 
2008 no 410 the directors’ report must contain certain 
disclosures regarding the company’s share capital and the 
rights and restrictions attaching to the company’s shares 
as set out in the following sections  these statements are 
included so as to comply with disclosure and t ransparency 
rule 726 regarding the statement of corporate governance
the company’s authorised and issued ordinary share capital 
as at 27 november 2011 comprised a single class of ordinary 
shares  the shares have a nominal value of 2 pence each  the 
isin of the shares is gb00b3mbs747
details of movements in the company’s issued share capital 
can be found in note 461 to the consolidated financial 
statements during the period shares in the company were 
issued as set out in note 461 to the consolidated financial 
statements disclosed in accordance with listing rule 
9847
rights attaching to shares
the company’s shares when issued are credited as fully paid 
and free from all liens equities charges encumbrances and 
other interests  all shares have the same rights including 
voting and dividend rights and rights on a return of capital 
and restrictions as set out in the articles described below
except in relation to dividends which have been declared and 
rights on a liquidation of the company the shareholders have 
no rights to share in the profits of the company
the company’s shares are not redeemable  however the 
company may purchase or contract to purchase any of the 
shares on or offmarket subject to the companies act and 
the requirements of the listing rules as described below
no shareholder holds shares in the company which carry 
special rights with regard to control of the company  there 
are no shares relating to an employee share scheme which 
have rights with regard to control of the company that are 
not exercisable directly and solely by the employees other 
than in the case of the group’s joint share ownership scheme 
the “jsos” where interests can be transferred to a spouse 
civil partner or lineal descendant of a participant in the 
jsos or certain trusts under the rules of the jsos as noted 
below 58
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
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directors’ report 
  
share rights subject to the companies act any resolution 
passed by the company under the companies act and other 
shareholders’ rights shares may be issued with such rights 
and restrictions as the company may by ordinary resolution 
decide or if there is no such resolution or so far as it does 
not make specific provision as the board may decide  such 
rights and restrictions will apply as if they were set out in the 
articles  redeemable shares may be issued  the directors 
can decide on the terms and conditions and the manner 
of redemption of any redeemable shares  such terms and 
conditions will apply as if they were set out in the articles  
subject to the articles the companies act and other 
shareholders’ rights the unissued shares in the company are 
at the disposal of the board
voting rights
shareholders will be entitled to vote at a general meeting or 
class meeting of the company whether on a show of hands 
or a poll as provided in the companies act  the companies 
act provides that a on a show of hands every member 
present in person has one vote and every proxy present 
who has been duly appointed by one or more members 
will have one vote except that a proxy has one vote for and 
one vote against if the proxy has been duly appointed by 
more than one member and the proxy has been instructed 
by one or more members to vote for and by one or more 
other members to vote against  for this purpose the articles 
provide that where a proxy is given discretion as to how to 
vote on a show of hands this will be treated as an instruction 
by the relevant shareholder to vote in the way that the 
proxy decides to exercise that discretion and b on a poll 
every member has one vote per share held by him and he 
may vote in person or by one or more proxies  where he 
appoints more than one proxy the proxies appointed by him 
taken together shall not have more extensive voting rights 
than he could exercise in person  this is subject to any rights 
or restrictions which are given to any shares or on which 
shares are held  if more than one joint shareholder votes 
including voting by proxy the only vote which will count is 
the vote of the person whose name is listed before the other 
voters on the register for the share
deadlines for exercising voting rights the articles provide a 
deadline for submission of proxy forms of not than less than 
48 hours before the time appointed for the holding of the 
meeting or adjourned meeting
restrictions on voting rights no shareholder shall be entitled 
to vote at any general meeting or class meeting in respect of 
any share held by him if any call or other sum then payable by 
him in respect of that share remains unpaid or if a member 
has been served with a restriction notice as defined in the 
articles described below
jsos voting rights disclosed in accordance with the listing 
rules 98412 and 98413 and the relevant company 
regulation appleby t rust jersey limited the independent 
company which is the trustee of the company’s employee 
benefit trust the “ebt t rustee” will not normally exercise 
the voting rights of unvested shares held under the jsos 
but may exercise such rights on vested shares at the request 
of the relevant participants of the jsos of the company’s 
issued shares 36305099 ordinary shares are held by 
greenwood nominees limited on behalf of the ebt t rustee 
at period end in respect of 7957000 ordinary shares which 
have vested under the jsos and remain in the trust at period 
end the ebt t rustee may vote in respect of such ordinary 
shares at the request of a participant the total of 36305099 
ordinary shares held by greenwood nominees limited on 
behalf of the ebt t rustee are treated as treasury shares 
in the group’s consolidated balance sheet in accordance 
with ias 32 “financial instruments presentation” as such 
calculations of earnings per share for the company exclude 
the 36305099 ordinary shares held by the ebt t rustee 
however the company does not hold any shares in treasury
dividends and other distributions
the company may by ordinary resolution from timetotime 
declare dividends not exceeding the amount recommended 
by the board  subject to the companies act the board 
may pay interim dividends and also any fixed rate dividend 
whenever the financial position of the company in the 
opinion of the board justifies its payment  if the board acts in 
good faith it is not liable to holders of shares with preferred 
or pari passu rights for losses arising from the payment of 
interim or fixed dividends on other shares  except insofar 
as the rights attaching to or the terms of issue of any share 
otherwise provide all dividends shall be apportioned and 
paid pro rata according to the amounts paid up on the share 
during any portion of the period in respect of which the 
dividend is paid  except as set out above dividends may be 
declared or paid in any currency
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directors’ report  
 
the board may if authorised by an ordinary resolution of the 
company offer shareholders excluding any member holding 
shares as treasury shares in respect of any dividend the right 
to elect to receive shares by way of scrip dividend instead of 
cash
any dividend unclaimed after a period of 12 years from the 
date when it was declared or became due for payment shall 
be forfeited and revert to the company  the company may 
stop sending cheques warrants or similar financial instruments 
in payment of dividends by post in respect of any shares or 
may cease to employ any other means of payment including 
payment by means of a relevant system for dividends if 
either i at least two consecutive payments have remained 
uncashed or are returned undelivered or that means of 
payment has failed or ii one payment remains uncashed or 
is returned undelivered or that means of payment has failed 
and reasonable enquiries have failed to establish any new 
postal address or account of the holder  the company may 
resume sending dividend cheques warrants or similar financial 
instruments or employing that means of payment if the 
holder requests such resumption in writing
restriction on dividends the board may withhold payment 
of all or any part of any dividends or other monies payable 
in respect of the company’s shares from a person with a 
025 per cent interest as defined in the articles if such a 
person has been served with a restriction notice as defined 
in the articles after failure to provide the company with 
information concerning interests in those shares required to 
be provided under the companies act
jsos dividend rights disclosed in accordance with the listing 
rules 98412 and 98413 and the relevant company 
regulation shares held under the jsos will not receive 
any dividends paid if any but the hurdles of the jsos 
would be reduced proportionally by the amount of the 
dividend payment so as not to distort the value of the jsos 
participants’ interests in the shares
restrictions on transfer of securities
the company’s shares are freely transferable save as set out 
below
the company may under the companies act send out 
statutory notices to those it knows or has reasonable cause 
to believe have an interest in its shares asking for details of 
those who have an interest and the extent of their interest 
in a particular holding of shares  when a person receives a 
statutory notice and fails to provide any information required 
by the notice within the time specified in it the company 
can apply to the court for an order directing among other 
things that any transfer of shares which are the subject of the 
statutory notice is void
the transferor of a share is deemed to remain the holder 
until the transferee’s name is entered in the register  the 
board can decline to register any transfer of any share which 
is not a fully paid share the company does not currently 
have any partially paid shares the board may also decline to 
register a transfer of a certificated share unless the instrument 
of transfer in any usual form or in any other form which 
the board may approve a is duly stamped or certified 
or otherwise shown to the satisfaction of the board to be 
exempt from stamp duty and is accompanied by the relevant 
share certificate or such other evidence of the right to 
transfer as the board may reasonably require b is in respect 
of only one class of share and c if to joint transferees is in 
favour of not more than four such transferees  registration 
of a transfer of an uncertificated share may be refused in the 
circumstances set out in the uncertificated securities rules as 
defined in the articles and where in the case of a transfer 
to joint holders the number of joint holders to whom the 
uncertificated share is to be transferred exceeds four
jsos participants’ interests under the jsos are generally non
transferable during the period beginning on acquisition of the 
interest and ending at the expiry of the relevant restricted 
period as set out in the jsos rules  however interests can 
be transferred to a spouse civil partner or lineal descendant 
of a participant a trust under which no person other than the 
participant or their spouse civil partner or lineal descendant 
has a vested beneficial interest or any other person approved 
by the ebt t rustee  if a participant purports to transfer 
assign or charge his interest other than as set out above the 
ebt t rustee may acquire the participant’s interest for a total 
price of £1
other than as described above the company is not aware 
of any agreements existing at the end of the period between 
holders of securities that may result in restrictions on the 
transfer of securities or that may result in restrictions on 
voting rights
variation of rights
subject to the companies act rights attached to any class of 
shares may be varied with the written consent of the holders 
of not less than threefourths in nominal value of the issued 
shares of that class calculated excluding any shares held as 
treasury shares or with the sanction of a special resolution 
passed at a separate general meeting of the holders of those 
shares  at every such separate general meeting except an 
adjourned meeting the quorum shall be two persons holding 
or representing by proxy not less than onethird in nominal 
value of the issued shares of the class calculated excluding 
any shares held as treasury shares
the rights conferred upon the holders of any shares shall not 
unless otherwise expressly provided in the rights attaching to 
those shares be deemed to be varied by the creation or issue 
of further shares ranking pari passu with them 60
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
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directors’ report 
  
powers for the company issuing shares
subject to the provisions of the companies act any equity 
securities issued by the company for cash must first be 
offered to shareholders in proportion to their holdings of 
shares  the companies act and the listing rules allow for 
the disapplication of preemption rights which may be waived 
by a special resolution of the shareholders either generally or 
specifically for a maximum period not exceeding five years
by written resolutions of the company’s shareholders passed 
on 11 may 2011 it was resolved that
1   the board be authorised to allot shares in the company 
and to grant rights to subscribe for or convert any 
security into shares in the company
a  up to a nominal amount of £3693429 such amount to 
be reduced by the nominal amount allotted or granted 
under paragraph b below in excess of such sum and
b   comprising equity securities as defined in section 
5601 of the companies act up to a nominal amount 
of £7386858 such amount to be reduced by any 
allotments or grants made under paragraph a above 
in connection with an offer by way of a rights issue i to 
ordinary shareholders in proportion as nearly as may be 
practicable to their existing holdings and ii to holders of 
other equity securities as required by the rights of those 
securities or as the board otherwise considers necessary
   and so that the board may impose any limits or 
restrictions and make any arrangements which it 
considers necessary or appropriate to deal with treasury 
shares fractional entitlements record dates legal 
regulatory or practical problems in or under the laws of 
any territory or any other matter 
such authorities to apply until the end of the agm or if 
earlier until the close of business on 11 august 2012 but in 
each case during this period the company may make offers 
and enter into agreements which would or might require 
shares to be allotted or rights to subscribe for or convert 
securities into shares to be granted after the authority ends 
and the board may allot shares or grant rights to subscribe 
for or convert securities into shares under any such offer or 
agreement as if the authority had not ended
2  the board be given power to allot equity securities for 
cash under the authority given by that resolution andor 
to sell ordinary shares held by the company as treasury 
shares for cash as if section 561 of the companies act 
did not apply to any such allotment or sale such power 
to be limited
a to the allotment of equity securities and sale of treasury 
shares for cash in connection with an offer of or invitation 
to apply for equity securities but in the case of the 
authority granted under paragraph b of resolution 1 by 
way of a rights issue only i  to ordinary shareholders 
in proportion as nearly as may be practicable to their 
existing holdings and ii to holders of other equity 
securities as required by the rights of those securities or 
as the board otherwise considers necessary
  and so that the board may impose any limits or restrictions 
and make any arrangements which it considers necessary 
or appropriate to deal with treasury shares fractional 
entitlements record dates legal regulatory or practical 
problems in or under the laws of any territory or any 
other matter and
b  in the case of the authority granted under paragraph a 
of resolution 1 andor in the case of any sale of treasury 
shares for cash to the allotment otherwise than under 
paragraph a above of equity securities or sale of 
treasury shares up to a nominal amount of £554014
such power to apply until the end of the agm or if earlier 
until the close of business on 11 august 2012 but in each 
case during this period the company may make offers and 
enter into agreements which would or might require equity 
securities to be allotted and treasury shares to be sold after 
the power ends and the board may allot equity securities 
and sell treasury shares under any such offer or agreement 
as if the power had not ended
these standard authorities for issuing shares on a non
preemptive basis for cash may be renewed annually 
the directors will seek to renew these authorities at the 
company’s agm as set out in the notice of meeting
powers for the company buying back its 
own shares
the description below concerning the company acquiring its 
own shares is made in accordance with the disclosure and 
t ransparency rule 41114 listing rule 9864 and the 
relevant company regulation  the company may purchase its 
shares only out of distributable reserves or the proceeds of a 
new issue of the company’s shares made for the purpose of 
funding the repurchase 
by resolutions of the company’s shareholders passed on 11 
may 2011 it was resolved that the company be authorised 
for the purposes of section 701 of the companies act to 
make one or more market purchases as defined in section 
6934 of the companies act of its ordinary shares of 2 
pence each such power to be limited
directors’ report continued 61 stock code ocdo wwwocadogroupcom
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a to a maximum number of 55401437 ordinary shares
b  by the condition that the minimum price which may be 
paid for an ordinary share is 2 pence and the maximum 
price which may be paid for an ordinary share is the 
highest of
  i  an amount equal to 5 above the average market 
value of an ordinary share for the five business days 
immediately preceding the day on which that ordinary 
share is contracted to be purchased and
  ii  the higher of the price of the last independent trade 
and the highest current independent bid on the 
trading venues where the purchase is carried out in 
each case exclusive of expenses 
such power to apply until the end of the agm or if earlier 
11 august 2012 but in each case so that the company may 
enter into a contract to purchase ordinary shares which will 
or may be completed or executed wholly or partly after the 
power ends and the company may purchase ordinary shares 
pursuant to any such contract as if the power had not ended
this standard authority for the company to purchase its 
shares may be renewed annually  the directors will seek to 
renew this authority at the company’s agm on the terms set 
out in the notice of meeting
the company has not acquired its shares during the period 
or a previous period the company did not hold or dispose 
of any shares in the company that were acquired by it in 
a previous period it is the company’s present intention to 
cancel any shares it buys back in future rather than hold them 
in treasury the company’s shares were not made the subject 
of a lien or other charge taken by the company
significant shareholders 
as required under listing rule 9862 and relevant company 
regulations the table below sets out the notifications that the 
company had received from its shareholders of the significant 
direct or indirect holdings being 3 per cent or more in the 
company’s shares pursuant to disclosure and t ransparency 
rule 5 which were also published on a regulatory information 
service and on the company’s corporate website during the 
period up to 27 november 2011 
 
 
number of
ordinary 
shares
percentage of
issued share 
capital at 
notification
date
nature of
holding
the london and amsterdam t rust company limited 61512060 1111 direct  indirect
hamilton t rust company limited as trustee for the apple ii t rust 61880100 1108 direct
fmr llc 54761301 988 indirect
the nomad investment p artnership lp 28423655 509 not stated
the steiner 2008 millennium t rust 27687600 500 direct  indirect
fil limited 27287909 493 indirect
the goldman sachs group inc below 3 below 3               not stated
ubs investment bank below 3 below 3 direct  indirect
t empest capital limited below 3 below 3 not stated
w alker fund services limited nil nil na
john lewis p artnership pensions t rust nil nil na
these figures represent the number of shares and percentage 
held as at the date of notification to the company as at 
period end the company’s issued share capital consisted of 
558362139 issued ordinary shares
as required under listing rule 9862a and relevant 
company regulations the table below sets out the 
notifications that the company had received from its 
shareholders of the significant direct or indirect holdings 
being 3 per cent or more in the company’s shares 
pursuant to disclosure and t ransparency rule 5 which were 
also published on a regulatory information service and on 
the company’s corporate website from 28 november 2011 
to 16 march 2012 being not more than one month prior to 
the likely date of the notice of meeting  62
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
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directors’ report 
  
number of
ordinary
shares
percentage of
issued share
capital at
notification
date
nature of
holding
the nomad investment p artnership lp 33742828 604 direct  indirect
fil limited 28520881 51 indirect
manning and napier advisers llc 26914371 500 direct
ubs investment bank below 3 below 3 direct  indirect
these figures represent the number of shares and percentage held as at the date of notification to the company as at  
16 march 2012 the company’s issued share capital consisted of 558702597 issued ordinary shares
directors’ report continued
important contracts or arrangements
under section 4175c of the companies act the company 
is required to disclose information about persons with whom 
the company has contractual or other arrangements which 
are essential to the business of the company
whilst the loss of or disruption to certain of the group’s 
supply financing or manufacturing arrangements for example 
vans and cfc machinery or other key contracts could affect 
the operations or growth of the group until a replacement 
solution is found none are considered to be essential to the 
business of the company  
however as noted in the principal risks and uncertainties 
ocado’s sourcing arrangements reputation and brand are 
based at least in part on its relationship with w aitrose  if 
the sourcing agreement with w aitrose were to end or if 
w aitrose were unable to source products for the group 
ocado would need to engage additional personnel to i 
find or create replacement ownlabel products and ii find 
appropriate suppliers and negotiate equivalent prices itself  
w aitrose through whom ocado sources the vast majority of 
products it sells and whose ownlabel products it sells is a 
uk supermarket chain and the food division of the privately 
owned retailer john lewis p artnership  w aitrose has over 
270 branches across the uk sells high quality food and places 
an emphasis on the provenance and traceability of the food 
that it sells  in its last financial year ended 29 january 2011 it 
had gross sales of £497 billion and made an operating profit 
of £2749 million source wwwjohnlewispartnershipcouk
the group’s £100 million credit facility with barclays bank 
plc hsbc bank plc and lloyds tsb bank plc described 
below may be terminated in certain circumstances including 
if the group were to breach one or more of the covenants 
under this facility which would put the group in default of 
this facility  this would jeopardise the group’s expansion 
plans and threaten the group’s ability to continue as a going 
concern  details concerning each of the lenders under 
the facility can be found on in the case of barclays bank its 
website httpgroupbarclayscom in the case of hsbc 
bank its website wwwhsbccom and in the case of lloyds 
tsb bank its website wwwlloydstsbcom
the principal risks and uncertainties section on pages 18 
to 23 describes these risks and the other principal risks and 
uncertainties facing the group that may have an adverse 
impact on the group’s operations performance or future 
prospects
contracts of significance
for the purposes of listing rule 98410 there were no 
contracts of significance subsisting during the period to 
which the company or any group subsidiary were a party 
and in which a director of the company were materially 
interested other than to note that the directors were party 
to certain lockup agreements with the company that were 
entered into in july 2010 in connection with the company’s 
admission whereby the directors agreed to certain lock
up arrangements that prevented the transfer of their shares 
in the company subject to certain exceptions  these 
lockup agreements ended during the period there were no 
contracts of significance subsisting during the period between 
the company or any group subsidiary and a controlling 
shareholder of the company 
change of control under significant agreements
there are a number of agreements to which the group is 
a party that take effect alter or terminate upon a change of 
control of the company following a takeover bid  details of 
the significant agreements of this kind are as follows
sourcing agreement if the parties terminate the sourcing 
agreement after certain competitors of w aitrose or john 
lewis acquire 50 per cent or more of the shares or control 
of the company’s board ocado is obliged to pay w aitrose 
the lower of £40 million and 4 per cent of the market 
capitalisation of the company  this change of control provision 
will cease to bind the parties if prior to the change of control 
any party has already given a valid notice of termination
credit facility agreement as noted above the group has 
a £100 million credit facility with barclays bank plc hsbc 
bank plc and lloyds tsb bank plc for the acquisition of land 
building materials plant machinery and equipment for cfc1 
andor cfc2 andor the spokes  if ocado or w aitrose gives 
notice to terminate the sourcing agreement it will be an 
event of default under this facility 63 stock code ocdo wwwocadogroupcom
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directors’ report  
 
hsbc equipment finance uk limited  on 22 july 2004 
ocado as lessee and hsbc equipment finance uk 
limited as lessor entered into a master sale and leaseback 
agreement  since then there have been 24 sale and 
leaseback agreements covering the majority of the conveyor 
systems and associated capital goods that have been added 
to cfc1 since august 2004  of these agreements 18 remain 
at period end with total amounts outstanding of £195 
million  the agreement may be terminated on one month’s 
notice by either party but without prejudice to rights accrued 
under any leasing agreements made thereunder  pursuant to 
side letters between ocado and hsbc varying the original 
agreement hsbc is able to terminate the agreement if there 
is a change of control of the company or if the sourcing 
agreement is terminated for any reason
change of control for director and employee 
agreements
the company does not have any agreements with any 
director or employee that would provide compensation for 
loss of office or employment resulting from a takeover except 
that it should be noted that i provisions of the company’s 
share schemes may cause options and shares granted to 
employees under such schemes to vest on a takeover and ii 
certain members of senior management not including the 
directors are entitled to a payment contingent on a change 
of control of the company or merger of the company 
irrespective of loss of employment as set out in his or her 
respective employment contract
results and dividends
the group’s results for the period are set out in the 
consolidated income statement on page 67  the group’s loss 
before tax for the period amounted to £24 million 2010 
£122 million
the directors do not propose to pay a dividend for the 
period 2010 nil
interest capitalised 
the amount of the interest capitalised by the group is set out in 
note 431 to the consolidated financial statements on page 93  
cumulative capitalised borrowing costs were £699000 2010 
£147000  there is no immediately available tax relief related to 
the capitalised borrowing costs 
post balance sheet events
important events occurring after the balance sheet date 
that affect the group are disclosed in note 55 to the 
consolidated financial statements
market value of properties
the directors are of the opinion that the aggregate market 
value of the group’s interests in land as at 27 november 
2011 is in line with the net book value as set out in note 
321 to the consolidated financial statements
creditor payment policy 
it is the group’s policy for all trade payables to agree payment 
terms in advance of the supply of goods with the supplier to 
make the supplier aware of the terms of payment and to adhere 
to those payment terms  the company is a holding company 
and therefore has little trade payables  the group did not follow 
any code or standard on payment practice in the period  the 
average trade payables payment period of the group’s main 
trading company ocado limited for the 52 weeks ended 
27 november 2011 was 26 days 2010 26 days based on the 
ratio of its average trade payables relating to resale goods for the 
period to the amounts invoiced during the year by those trade 
payables
research and development and future 
developments
the group has dedicated inhouse software logistics and 
engineering design and development teams with primary 
focus on it and improvements to the cfcs and the material 
handling equipment  costs relating to the development of 
computer software are capitalised if they relate to internal 
capital projects
the group’s likely future developments including its strategy are 
described in the about ocado section on pages 10 to 17 
business model and strategy
as required by the 2010 code the about ocado section on 
pages 10 to 17 describes the company’s business model for 
sustainable growth  this provides an explanation of the basis 
on which the group generates value and preserves it over 
the longterm and its strategy for delivering its objectives  64
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
directors’ report 
  
going concern
in adopting the going concern basis for preparing the financial 
statements the directors have made appropriate enquiries 
and have considered the group’s cash flows liquidity position 
and borrowing facilities and business activities as set out on 
page 56 and the group’s principal risks and uncertainties as 
set on pages 18 to 23 based on the group’s rolling forecasts 
the directors are satisfied that the company and the 
group as a whole have adequate resources to continue in 
operational existence for the foreseeable future  accordingly 
the financial statements have been prepared on the going 
concern basis in accordance with going concern and 
liquidity risk guidance for directors of uk companies 2009 
published by the financial reporting council in october 
2009
the principal risks and uncertainties section on pages 18 to 
23 describes the principal risks and uncertainties facing the 
group including those that may have an adverse impact on 
the group’s operations performance or future prospects 
and the going concern basis noted above  the group’s cash 
flows liquidity position and borrowing facilities and business 
activities are described on page 56 and set out in the group’s 
financial statements on pages 67 to 114 further information 
on going concern is set out in section 1 to the consolidated 
financial statements on page 73
the company’s going concern statement has been reviewed 
by the company’s auditors pricewaterhousecoopers llp  as 
required by listing rule 9810r1
borrowings and covenants
the most material of the group’s borrowing facilities is its 
£100 million credit facility with barclays bank plc hsbc bank 
plc and lloyds tsb bank plc  the facility contains customary 
covenant provisions in respect of net debt gross debt and 
interest cover  the financial covenants are as follows
 z net debt ratio – the net debt financial covenant requires 
that the ratio of net debt to adjusted ebitda at the end 
of each quarter period must not exceed 31 for each 
test period until the test period falling in november 
2011 must not exceed 3251 for the test period falling 
in february 2012 must not exceed 351 for each test 
period thereafter until the test date falling in august 
2013 and must not exceed 3251 thereafter and
 z interest cover ratio – the interest cover financial 
covenant requires that the ratio of ebitda to net 
interest at the end of each quarter period be not less 
than 31 until the test date falling in may 2011 not less 
than 351 thereafter until the test date falling in august 
2011 and not less than 41 thereafter and
 z gross debt ratio – the gross debt financial covenant 
requires that the ratio of gross debt to adjusted ebitda 
must not exceed 551 for any test period in respect of 
which ebitda is less than £35 million 
ebitda in respect of a test period refers to ebitda for the 
relevant prior 12 month period  all covenant tests which 
exist under the terms of the facility are tested quarterly  
the table below outlines the relevant covenant tests and the 
actual position of the group at the end of the period 
covenant actual
net debtebitda 31 0741
fixed interest cover 41 5761
gross debtebitda 551 4041
at the date of entering the facility agreement on 5 july 2010 
the net debt covenant applicable to the life of the facility 
was not in excess of 31  during the period the group 
agreed with the lenders under the facility that the net debt 
ratio financial covenant be amended such that the ratio be 
increased from 31 to the new net debt ratios outlined above
statement of directors’ responsibilities
the directors are responsible for preparing the annual 
report the directors’ remuneration report and the financial 
statements in accordance with applicable law and regulations
company law requires the directors to prepare financial 
statements for each financial year  under that law the 
directors have prepared the group and parent company 
financial statements in accordance with international financial 
reporting standards ifrss as adopted by the european 
union  under company law the directors must not approve 
the financial statements unless they are satisfied that they 
give a true and fair view of the state of affairs of the group 
and the company and of the result of the company and 
the group for that period  in preparing these financial 
statements the directors are required to
 z select suitable accounting policies and then apply them 
consistently
 z make judgements and accounting estimates that are 
reasonable and prudent
 z state whether applicable ifrss as adopted by the 
european union have been followed subject to any 
material departures disclosed and explained in the 
financial statements and
 z prepare the financial statements on the going concern 
basis unless it is inappropriate to presume that the 
company will continue in business
directors’ report continued 65 stock code ocdo wwwocadogroupcom
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directors’ report  
 
the directors are responsible for keeping adequate 
accounting records that are sufficient to show and explain 
the company’s transactions and disclose with reasonable 
accuracy at any time the financial position of the company 
and the group and enable them to ensure that the financial 
statements and the directors’ remuneration report comply 
with the companies act and as regards the group financial 
statements article 4 of the ias regulation  they are also 
responsible for safeguarding the assets of the company and 
the group and hence for taking reasonable steps for the 
prevention and detection of fraud and other irregularities
the directors are responsible for the maintenance and integrity 
of the company’s website  legislation in the united kingdom 
governing the preparation and dissemination of financial 
statements may differ from legislation in other jurisdictions
each of the directors who held office at the date of the 
approval of this annual report confirms to the best of their 
knowledge that
 z the group financial statements which have been 
prepared in accordance with ifrss as adopted by the eu  
give a true and fair view of the assets liabilities financial 
position and profit and loss of the group and
 z the directors’ report includes a fair review of the 
development and performance of the business and the 
position of the group together with a description of the 
principal risks and uncertainties that it faces
disclosure of information to auditors
in accordance with the companies act each director who 
held office at the date of the approval of this directors’ report 
confirms that so far as he or she is aware there is no relevant 
audit information of which the group’s auditors are unaware 
and that each director has taken all of the steps that they 
ought to have taken as a director in order to make himself or 
herself aware of any relevant audit information and to establish 
that the group’s auditors are aware of that information
independent auditors
the company’s auditors pricewaterhousecoopers llp  
have indicated their willingness to continue their role 
as the company’s auditors  resolutions concerning the 
reappointment of pricewaterhousecoopers llp as auditors 
of the company and to authorise the directors to determine 
their remuneration will be proposed at the agm and set out 
in the notice of meeting
forwardlooking statements
certain statements made in this report are forward
looking statements  such statements are based on current 
expectations and assumptions and are subject to a number 
of risks and uncertainties that could cause actual events or 
results to differ materially from any expected future events 
or results expressed or implied in these forwardlooking 
statements  they appear in a number of places throughout 
this report and include statements regarding the intentions 
beliefs or current expectations of the directors concerning 
amongst other things the group’s results of operations 
financial condition liquidity prospects growth strategies 
and the business  persons receiving this report should not 
place undue reliance on forwardlooking statements  unless 
otherwise required by applicable law regulation or accounting 
standard ocado does not undertake to update or revise 
any forwardlooking statements whether as a result of new 
information future developments or otherwise
approved by the board
neill abrams
company secretary and legal and business affairs director 66
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
independent auditors’ report
  
 
independent auditors’ report 
to the members of ocado group plc
w e have audited the group financial statements of ocado 
group plc for the year ended 27 november 2011 which 
comprise the consolidated income statement consolidated 
statement of comprehensive income the consolidated 
balance sheet the consolidated statement of cash flows the 
consolidated statement of changes in equity and the related 
notes  the financial reporting framework that has been 
applied in their preparation is applicable law and international 
financial reporting standards ifrss as adopted by the 
european union 
respective responsibilities of directors        
and auditors 
as explained more fully in the directors’ responsibilities 
statement as set out on pages 64 and 65 the directors are 
responsible for the preparation of the consolidated financial 
statements and for being satisfied that they give a true and 
fair view  our responsibility is to audit and express an opinion 
on the consolidated financial statements in accordance with 
applicable law and international standards on auditing uk 
and ireland  those standards require us to comply with the 
auditing practices board’s ethical standards for auditors 
this report including the opinions has been prepared for and 
only for the company’s members as a body in accordance 
with chapter 3 of part 16 of the companies act and for no 
other purpose  w e do not in giving these opinions accept or 
assume responsibility for any other purpose or to any other 
person to whom this report is shown or into whose hands it 
may come save where expressly agreed by our prior consent 
in writing
scope of the audit of the financial statements 
an audit involves obtaining evidence about the amounts 
and disclosures in the financial statements sufficient to give 
reasonable assurance that the financial statements are free 
from material misstatement whether caused by fraud or 
error  this includes an assessment of whether the accounting 
policies are appropriate to the group’s circumstances and 
have been consistently applied and adequately disclosed the 
reasonableness of significant accounting estimates made by 
the directors and the overall presentation of the financial 
statements  in addition we read all the financial and non
financial information in the annual report to identify material 
inconsistencies with the audited financial statements  if we 
become aware of any apparent material misstatements or 
inconsistencies we consider the implications for our report
opinion on financial statements 
in our opinion the group financial statements 
 z give a true and fair view of the state of the group’s 
affairs as at 27 november 2011 and of its loss and cash 
flows for the year then ended 
 z have been properly prepared in accordance with ifrss as 
adopted by the european union and 
 z have been prepared in accordance with the 
requirements of the companies act and article 4 of the 
las regulation 
opinion on other matters prescribed by the 
companies act
in our opinion
 z the information given in the directors’ report for the 
financial year for which the group financial statements 
are prepared is consistent with the consolidated financial 
statements and
 z the information given in the statement  of corporate 
governance set out on pages 30 to 45 in the annual 
report with respect to internal control and risk 
management systems and about share capital structures 
is consistent with the financial statements 
matters on which we are required to report  
by exception 
w e have nothing to report in respect of the following 
under the companies act we are required to report to you 
if in our opinion 
 z certain disclosures of directors’ remuneration specified 
by law are not made or 
 z we have not received all the information and 
explanations we require for our audit
under the listing rules we are required to review 
 z the directors’ report set out on pages 56 to 65 in 
relation to going concern and
 z the part of the statement of corporate governance 
relating to the company’s compliance with the nine 
provisions of the uk corporate governance code 
specified for our review
other matter 
w e have reported separately on the parent company 
financial statements of ocado group plc for the year ended 
27 november 2011 and on the information in the directors’ 
remuneration report that is described as having been audited 
clive hinds senior statutory auditor
for and on behalf of pricewaterhousecoopers llp
chartered accountants and statutory auditors
st albans
21 march 2012 67 stock code ocdo wwwocadogroupcom
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our financials our performance
consolidated income statement   
consolidated income statement
for the 52 weeks ended 27 november 2011
  notes
52 weeks 
ended
 27 november
2011
£’000
52 weeks
ended
28 november
2010
£’000
revenue 212 598309 515688 
cost of sales   413551 354043
gross profit 184758 161645 
other income 12550 6245 
distribution costs   151725 132809
operating profit before administrative expenses and exceptional items 45583 35081 
administrative expenses 44511 36895
exceptional items   — 3542
operating profitloss 213 1072 5356
finance income 431 1168 1502 
finance costs 431 4663 8357
loss before tax 2423 12211
t axation 221 1920 5000 
loss for the period attributable to the owners of the parent   503 7211
pence pence
loss per share
basic and diluted loss per share 23 010 163
nongaap measure earnings before interest taxation depreciation amortisation impairment and exceptional 
items ebitda
  notes
52 weeks 
ended 
27 november 
2011
£’000
52 weeks 
ended
28 no vember 
2010
£’000
operating profitloss 1072 5356
adjustments for
depreciation of property plant and equipment 321 21261 19333 
amortisation expense 311 5460 4474 
impairment of property plant and equipment 321 76 14 
exceptional items — 3542 
ebitda   27869 22007  68
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
consolidated statement of comprehensive income
 
 
 
consolidated statement of comprehensive income
for the 52 weeks ended 27 november 2011
 
52 weeks
ended
27 november 
2011
£’000
52 weeks
ended
28 no vember 
2010
£’000
loss for the period attributable to the owners of the parent 503 7211
other comprehensive incomeexpense
cash flow hedges
— gains arising on forward foreign exchange contracts 568 818 
— gains transferred to property plant and equipment 1232 92
— losses arising on interest rate swaps 52 — 
foreign exchange loss on translation of foreign subsidiary 1 — 
other comprehensive expenseincome for the period net of tax 717 726 
t otal comprehensive expense for the period attributable to the owners of the parent 1220 6485 69 stock code ocdo wwwocadogroupcom
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our financials our performance
consolidated balance sheet  
consolidated balance sheet
as at 27 november 2011
  notes
27 november 
2011
£’000
28 november 
2010
£’000
noncurrent assets
intangible assets 311 13233 8069 
property plant and equipment 321 194114 100031 
deferred tax asset 222 9615 7300 
a vailableforsale financial asset 331 395 395 
    217357 115795 
current assets
inventories 341 14310 12480 
t rade and other receivables 342 37885 18569 
derivative financial instruments 441 11 472 
shortterm investment 343 — 30000 
cash and cash equivalents 344 92102 124639 
    144308 186160 
t otal assets   361665 301955 
current liabilities
t rade and other payables 345 75555 55491
borrowings 412 3270 2282
obligations under finance leases 413 19643 16485
derivative financial instruments 441 318 — 
provisions 351 686 115
    99472 74373
net current assets   44836 111787 
noncurrent liabilities
borrowings 412 45793 9774
obligations under finance leases 413 42561 45573
provisions 351 555 446
deferred tax liability 222 395 — 
    89304 55793
net assets   172889 171789 
equity
share capital 461 11167 11068 
share premium 461 213783 206094 
t reasury shares reserve 461 53805 47741
reverse acquisition reserve 461 116230 116230
other reserves 461 9 726 
retained earnings 117965 117872 
t otal equity   172889 171789 
the consolidated financial statements on pages 67 to 114 were authorised for issue by the board of directors and signed on 
its behalf by
tim steiner 
chief executive officer 
andrew bracey
chief financial officer
ocado group plc 
company registration number 07098618 england and w ales
21 march 2012 70
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
consolidated statement of cash flows   
consolidated statement of cash flows
for the 52 weeks ended 27 november 2011
 
  notes
52 weeks
ended
27 november 
2011
£’000
52 weeks
ended
28 november
2010
£’000
cash flows from operating activities
loss before tax 2423 12211
adjustments for
— depreciation of property plant and equipment 321 21261 19333 
— amortisation expense 311 5460 4474 
— impairment of property plant and equipment 321 76 14 
— lossprofit on disposal of property plant and equipment 213 38 63
— provision for dilapidations expense 351 201 80 
— provision for insurance claims 351 479 115 
— sharebased payments expense 471 596 320 
— foreign exchange movements 265 — 
— finance income 431 1168 1502
— finance costs 431 4663 8357 
changes in working capital
— movement in inventories 1830 3267
— movement in trade and other receivables 17769 1897
— movement in trade and other payables   17048 4791 
cash generated from operations 26367 18544 
interest paid 6219 10319
net cash flows from operating activities   20148 8225 
cash flows from investing activities
purchase of property plant and equipment 105184 14681
proceeds from sale of property plant and equipment — 87 
purchase of intangible assets 8980 5850
decreaseincrease in shortterm investment 30000 30000
interest received 949 167 
net cash flows from investing activities   83215 50277
cash flows from financing activities
proceeds from the issue of ordinary share capital net of transaction costs 1248 210104 
proceeds from borrowings 39291 11374 
repayments of borrowings 2284 54063
proceeds from asset based financing arrangements 9889 1676 
repayments of obligations under finance leases 19013 15417
settlement of forward foreign exchange contracts 1134 — 
net cash flows from financing activities   30265 153674 
net decreaseincrease in cash and cash equivalents 32802 111622 
cash and cash equivalents at the beginning of the period 124639 13017 
exchange adjustments 265 — 
cash and cash equivalents at the end of the period 344 92102 124639  71 stock code ocdo wwwocadogroupcom
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our financials our performance
consolidated statement of changes in equity   
consolidated statement of changes in equity
for the 52 weeks ended 27 november 2011
notes
share 
capital
£’000
share
premium
£’000
t reasury
shares
reserve
£’000
reverse
acquisition
reserve
£’000
other
reserves
£’000
accumu
lated
deficit
retained
earnings
£’000
total 
equity
£’000
balance at 29 november 2009   40 310836 — — — 343026 32150
loss for the period — — — — — 7211 7211
other comprehensive income
expense
cash flow hedges
— gains arising on foreign
 exchange contracts 461d — — — — 818 — 818 
— gains transferred to property
 plant and equipment 461d — — — — 92 — 92
t otal comprehensive income
expense for the period — — — — 726 7211 6485
t ransactions with owners
— issue of ordinary shares in 
 ocado limited 461 3 49443 47741 — — — 1705 
— cancellation of ocado limited
 ordinary shares 461b 43 — — — — 43 — 
— issue of ordinary and
 convertible preference shares
 by ocado group plc 461b 476509 — — 476509 — — — 
— ocado group plc capital
 reduction 461b 467846 — — — — 467846 — 
— reverse acquisition of ocado
 limited by ocado group plc 461c — 360279 — 360279 — — — 
— issue of ordinary shares by 
 ocado group plc on ipo 461 2380 211862 — — — — 214242 
— ordinary shares issue costs 461 — 6881 — — — — 6881
— issue of ordinary shares in 
 ocado group plc 461 25 1113 — — — — 1138 
— sharebased payments charge 471 — — — — — 220 220 
t otal transactions with owners 11028 104742 47741 116230 — 468109 210424 
balance at 28 november 2010   11068 206094 47741 116230 726 117872 171789 
loss for the period — — — — — 503 503
other comprehensive income
expense
cash flow hedges
—  gains arising on forward 
foreign exchange contracts 461d — — — — 568 — 568 
—  losses arising on interest  
rate swaps 461d — — — — 52 — 52
— gains transferred to property
 plant and equipment 461d — — — — 1232 — 1232
t ranslation of foreign subsidiary 461d — — — — 1 — 1
t otal comprehensive expense for the period — — — — 717 503 1220
t ransactions with owners
— issue of ordinary shares 461 99 7652 6308 — — — 1443 
— disposal of treasury shares 461 — 37 244 — — — 281 
— sharebased payments charge 471 — — — — — 596 596 
t otal transactions with owners 99 7689 6064 — — 596 2320 
balance at 27 november 2011   11167 213783 53805 116230 9 117965 172889  72
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
notes to the consolidated financial statements  
notes to the consolidated financial statements
section 1 — basis of preparation
general information
ocado group plc hereafter “the company” is incorporated and 
domiciled in the united kingdom  the address of its registered 
office is titan court 3 bishops square hatfield business p ark 
hatfield hertfordshire al10 9ne  the financial statements 
comprise the results of the company and its subsidiaries hereafter 
“the group” see note 51  the financial period represents the 
52 weeks ended 27 november 2011  the prior financial period 
represents the 52 weeks ended 28 november 2010
basis of preparation
the financial statements have been prepared in accordance 
with the listing rules and the disclosure and t ransparency 
rules of the uk financial services authority where applicable 
international financial reporting standards ifrs’s and 
international financial reporting interpretation committee 
ifrs ic interpretations as endorsed by the european union 
“ifrseu” and with those parts of the companies act 
applicable to companies reporting under ifrs
the financial statements are presented in sterling rounded to 
the nearest thousand £’000 unless otherwise stated  they 
have been prepared under the historical cost convention 
except for derivative financial instruments that have been 
measured at fair value
the financial statements have been prepared on the going 
concern basis which assumes that the group will continue to 
be able to meet its liabilities as they fall due for the foreseeable 
future
standards amendments and interpretations 
adopted by the group in 201011 or issued but 
are not yet effective and which have not been 
early adopted by the group
the group has considered the following new standards 
interpretations and amendments to published standards that 
are effective for the group for the financial year beginning 
29 november 2010 and concluded that they are either not 
relevant to the group or that they would not have a significant 
impact on the group’s financial statements
 z ifric 15 “arrangements for the construction of real 
estate”  this ifric was effective 1 january 2009 but eu 
endorsed for 1 january 2010
 z ifric 19 “extinguishing financial liabilities with equity 
instruments”
 z amendments to various ifrss and iass arising from the 
iasb’s annual improvements project in 2009
the following new standards interpretations and amendments 
to published standards and interpretations which are relevant 
to the group have been issued but are not effective for the 
financial year beginning 29 november 2010 and have not been 
adopted early
 z ifrs 9 “financial instruments”
 z ifrs 10 “consolidated financial statements”
 z ifrs 11 “joint arrangements”
 z ifrs 12 “disclosure of interests in other entities”
 z ifrs 13 “fair value measurement”
 z ias 24 revised “related p arty disclosures”
 z ias 27 revised 2011 “separate financial statements”
 z ias 28 revised 2011 “investments in associates and 
joint v entures”
 z amendments to various ifrss and iass arising from the 
iasb’s annual improvements project in 2010
 not yet endorsed by the eu 
basis of consolidation
the consolidated financial statements include the financial 
statements of all subsidiaries  the financial statements 
of subsidiaries are included in the consolidated financial 
statements from the date on which control over the 
operating and financial decisions is obtained and cease to be 
consolidated from the date on which control is transferred 
out of the group  control exists when the company has 
the power directly or indirectly to govern the financial and 
operating policies of an entity so as to obtain economic 
benefits from its activities
all intercompany balances and transactions including 
recognised gains arising from intergroup transactions have 
been eliminated in full  unrealised losses are eliminated in the 
same manner as recognised gains except to the extent that 
they provide evidence of impairment
accounting policies
the principal accounting policies adopted in the preparation 
of these financial statements are set out in the relevant 
notes to these financial statements  accounting policies not 
specifically attributable to a note are set out below  these 
policies have been consistently applied to all the periods 
presented unless otherwise stated
foreign currency translation
functional and presentation currency
items included in the financial statements of each of the 
group’s entities are measured using the currency of the 
primary economic environment in which the entity operates 
“the functional currency”  sterling is the company’s 
functional and the group’s presentation currency
transactions and balances
foreign currency transactions are translated into the 
functional currency using the exchange rates prevailing at 
the dates of the transactions or valuation where items are 
remeasured  foreign exchange gains or losses resulting from 
the settlement of such transactions and from the translation 
at year end exchange rates of monetary assets and liabilities 
denominated in foreign currencies are recognised in the 
income statement except when deferred in equity as 
qualifying cash flow hedges 73 stock code ocdo wwwocadogroupcom
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our financials our performance
notes to the consolidated financial statements
  
section 1 — basis of preparation continued
foreign exchange gains and losses that relate to borrowings 
and cash and cash equivalents are presented in the income 
statement within finance income or finance costs  all other 
foreign exchange gains and losses are presented in the 
income statement within operating profitloss
group companies
the results and financial position of all the group entities 
none of which has the currency of a hyperinflationary 
economy that have a functional currency different from the 
presentation currency are translated into the presentation 
currency as follows
a assets and liabilities for each balance sheet presented are 
translated at the closing rate at the date of that balance 
sheet
b income and expenses for each income statement are 
translated at average exchange rates unless average is 
not a reasonable approximation of the cumulative effect 
of the rates prevailing on the transaction dates in which 
case income and expenses are translated at the rate on 
the dates of the transactions and
c all resulting exchange differences are recognised as a 
separate component of equity
on consolidation exchange differences arising from the 
translation of the net investment in foreign operations 
and of borrowings and other currency instruments 
designated as hedges of such investments are taken to other 
comprehensive income  when a foreign operation is partially 
disposed of or sold exchange differences that were recorded 
in equity are recognised in the income statement as part of 
the gain or loss on sale
the accounting policies have been applied consistently by the 
group to all periods presented in the financial statements
critical accounting estimates and assumptions
the preparation of financial statements in conformity with 
ifrseu requires the use of certain critical accounting 
estimates  it also requires management to exercise its 
judgement in the process of applying the group’s accounting 
policies 
estimates and judgements are continually evaluated and are 
based on historical experience and other factors including 
expectations of future events that are believed to be 
reasonable under the circumstances
the group makes estimates and assumptions concerning the 
future  the resulting accounting estimates will by definition 
seldom equal the related actual results  the estimates and 
assumptions that have a significant risk of causing a material 
adjustment to the carrying amounts of assets and liabilities 
within the next financial period are set out below and in 
more detail in the related notes
 z recognition of deferred tax assets note 22
 z intangible assets — capitalised software note 31
 z property plant and equipment note 32
 z t rade and other receivables — supplier income note 
34  
 z leases note 41 and
 z going concern basis including its effect on the impairment 
of assets see below
going concern basis including its effect on the 
impairment of assets
the group has cash reserves and maintains a mixture of 
short and mediumterm debt and lease finance arrangements 
that are designed to ensure that it has sufficient available 
funds to finance its operations  the board monitors rolling 
forecasts of the group’s liquidity requirements based on a 
range of precautionary scenarios to ensure it has sufficient 
cash to meet operational needs while maintaining sufficient 
headroom on its committed borrowing facilities at all times 
so that the group does not breach borrowing limits or 
covenants where applicable on any of its borrowing facilities  
under all the above scenarios the directors have a 
reasonable expectation that the existing facilities provide 
sufficient funding for the group to operate as a going 
concern for the foreseeable future  as part of the above 
the board continues to monitor the timing and amounts of 
uncommitted capital projects  expenditure on these capital 
projects and other discretionary expenditure can be delayed 
if the group is performing at the lower end of the range of 
these scenarios 
after making appropriate enquiries and having considered 
the business activities as set out on page 56 and the group’s 
principal risks and uncertainties as set on pages 18 to 23 the 
directors are satisfied that the company and the group as 
a whole have adequate resources to continue in operational 
existence for the foreseeable future  accordingly the financial 
statements have been prepared on a going concern basis
impairment of assets based on the separation of the 
business into cash generating units
the group is required to undergo an assessment of the 
future viability of assets grouped at the lowest levels for which 
there are separately identifiable cash flows cash generating 
units  given the group’s current operating structure the 
lowest level at which cash flows can reasonably be assessed 
is for the group as a whole  the group is still investing in 
its future growth and so has not yet reached a stage where 
it delivers positive posttax earnings  based on the future 
projections referred to above the board does not consider 
that any further impairment of assets is required  there are 
a large number of assumptions and estimates involved in 
calculating these future projections including management’s 
expectations of
 z increase in gross sales
 z growth in ebitda
 z timing and quantum of future capital expenditure and
 z the estimation and cost of future funding 74
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
notes to the consolidated financial statements  
section 2 — results for the year
21 loss before tax
accounting policies
revenue
revenue comprises the fair value of consideration received or 
receivable for the sale of goods and services
sales through the w ebshop are shown net of returns 
relevant marketing vouchersoffers and value added taxes  
relevant vouchersoffers include moneyoff coupons 
conditional spend vouchers and offers such as buy three for 
the price of two  delivery charges are included in revenue
revenue is recognised at the point when the significant risks 
and rewards of products have been passed to the buyer 
and can be reliably measured in general this is deemed to 
occur when customers take delivery of the goods  income 
from “ocado delivery p ass” the group’s discounted pre
pay delivery scheme is recognised in the period to which it 
relates on an accruals basis
cost of sales
cost of sales represents the cost of groceries and other 
products the group sells any associated licence fees which 
are linked to the volume of sales of specific products or 
product groups including the branding and sourcing fees 
payable to w aitrose adjustments to inventory and charges 
for transportation of goods from a supplier to cfc1
at the period end the group is required to estimate supplier 
income due from annual agreements  estimates are required 
due to the fact that the majority of these agreements end 
after the financial year end of the group which results in the 
group only receiving firm confirmation of amounts due after 
the period end  this income is estimated on historical data 
and review of major contracts with suppliers
other income
other income comprises the fair value of consideration 
received or receivable for advertising services provided by 
ocado to suppliers and other third parties on the w ebshop 
commission income and sublease payments receivable
employee benefits
the group contributes to the personal pension plans of its 
staff through a defined contribution personal pension scheme 
which is administered by standard life  employer contributions 
to the scheme are calculated as a percentage of salary based 
on length of scheme membership  contributions are charged 
to the income statement in the period to which they relate
distribution costs
distribution costs consist of all the costs incurred excluding 
product costs to the point of sale usually the customer’s home  
this includes the payrollrelated expenses for the picking 
dispatch and delivery of product sold to the point of sale the 
cost of making those deliveries including fuel tolls maintenance 
of vehicles the operating costs of the properties required for 
the picking dispatch and onward delivery operations and all 
associated depreciation amortisation and impairment charges 
call centre costs and payment processing charges
administrative expenses
administrative expenses consist of all it costs advertising 
and marketing expenditure employment costs of all head 
office functions which include legal finance human resources 
marketing and procurement rent and other propertyrelated 
costs for the head office all fees for professional services and 
the depreciation amortisation and impairment associated 
with head office it equipment software fixtures and fittings 
and expenses relating to the esos and the jsos
exceptional items
exceptional items as disclosed on the face of the income 
statement are items that due to their material and non
recurring nature have been classified separately in order to 
draw them to the attention of the reader of the financial 
statements
notes to the consolidated financial statements continued 75 stock code ocdo wwwocadogroupcom
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our financials our performance
211 segmental reporting
the group’s principal activity is that of grocery retailing 
derived solely from the uk  the group is not reliant on any 
major customer for 10 or more of its revenue
operating segments are reported in a manner consistent 
with the internal reporting provided to the chief operating 
decisionmaker as required by ifrs 8  the chief operating 
decisionmaker who is responsible for allocating resources 
and assessing performance of the operating segments has 
been identified as the executive directors
the principal activity of the group is managed as one 
segment  the group does not split its activities into any 
further regional or product subdivisions in its internal 
management reporting as any such split would not provide 
the group’s management with any meaningful information  
consequently all activities relate to this one segment
the chief operating decisionmaker’s main indicator of 
performance of the segment is ebitda which is reconciled 
to operating profitloss below the income statement
212 gross sales
 
52 weeks
ended
27 nov ember 
2011
£’000
52 weeks
ended
28 no vember 
2010
£’000
revenue 598309 515688 
vat 36508 27285 
marketing vouchers 7983 8126 
gross sales 642800 551099 
213 operating profitloss
 
 
 
notes
52 weeks
ended
27 no v ember  
2011
£’000
52 weeks
ended
28 no vember 
2010
£’000
operating profitloss is stated after chargingcrediting the following
cost of inventories recognised as an expense 400878  344796 
employment costs 214 113331  96739 
amortisation expense 311 5460  4474 
depreciation of property plant and equipment 321 21261  19333 
impairment of property plant and equipment included in 321 76  14 
— distribution costs 76  8 
— administrative expenses —  6 
lossprofit on disposal of property plant and equipment 38  63
impairment of receivables 36  45 
operating lease rentals
— land and buildings 2878  2347 
— other leases 481  413 
net foreign exchange gainslosses   194 147 
notes to the consolidated financial statements
   76
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
213 operating profitloss continued
during the period the group obtained the following services from its auditors 
 
 
52 weeks
ended
27 no v ember  
2011
£’000
52 weeks
ended
28 no vember 
2010
£’000
audit services
— statutory group and company audit 47  40 
— statutory audit of subsidiaries 162  185 
nonaudit services
— advisory support 19  — 
— services pursuant to legislation and compliance† —  975 
— other services —  108 
 228  1308 
† comprises primarily services in relation to the preparation for the listing of the company
214 employee information
employment costs during the financial period were as follows
 
 
 
notes
52 weeks
ended
27 no v ember  
2011
£’000
52 weeks
ended
28 no vember 
2010
£’000
staff costs during the period
w ages and salaries 109236  91699 
social security costs 10328  8665 
pension costs — defined contribution plans 1414  1197 
sharebased payments expense   596  320 
total gross employment costs 121574  101881 
staff costs capitalised 311 8243 5142
t otal net employment costs   113331  96739 
average monthly number of employees including executive directors by function
operational staff 4567  3835 
support staff   613  417 
 5180  4252 
the sharebased payments expense relates to the group’s equitysettled share schemes see note 47 for information on the 
group’s share option schemes  the prior period included a cashsettled sharebased payment of £01m 
215 exceptional items
there were no exceptional costs in the current period  in the prior period the group incurred costs relating to its ipo  the 
portion allocated to profit and loss represents the portion of directly attributable costs relating to the secondary shares traded 
on admission and other costs attributable to the listing  total costs expensed in the prior period were £35 million and 
related primarily to legal and professional fees
notes to the consolidated financial statements  
notes to the consolidated financial statements continued 77 stock code ocdo wwwocadogroupcom
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2106604 08022012 proof 1
our financials our performance
22 t axation
accounting policies
the tax credit for the period comprises current and deferred 
tax  t ax is recognised in the income statement except 
to the extent that it relates to items recognised in other 
comprehensive income or directly in equity  in this case the 
tax is also recognised in other comprehensive income or 
directly in equity respectively
current taxation
current tax is the expected tax payable on the taxable income 
for the period using tax rates enacted or substantively enacted 
by the balance sheet date  management periodically evaluates 
positions taken in tax returns with respect to situations in 
which applicable tax regulation is subject to interpretation  
it establishes provisions where appropriate on the basis of 
amounts expected to be paid to the tax authorities
deferred taxation
deferred tax is recognised using the balance sheet liability 
method on temporary differences arising between the tax 
base of assets and liabilities and their carrying amount in 
the financial statements  deferred tax is calculated at the 
tax rates that have been enacted or substantively enacted 
by the balance sheet date and are expected to apply when 
the related deferred tax asset is realised or the deferred tax 
liability is settled
deferred tax assets are recognised only to the extent that 
it is probable that future taxable profits will be available 
against which the temporary differences can be utilised  
recognition therefore involves judgement regarding the 
prudent forecasting of future taxable profits of the business 
and in applying an appropriate risk adjustment factor  the 
final outcome of some of these items may give rise to 
material profit and loss andor cash flow variances  at the 
balance sheet date management has forecast that the group 
would generate future taxable profits against which existing 
tax losses could be relieved  as a result the group has 
recognised a deferred tax asset of £96 million with respect 
to available tax losses  the carrying amount of deferred tax 
assets is reviewed at each balance sheet date
deferred tax assets and liabilities are offset against each other 
when there is a legally enforceable right to offset current 
taxation assets against current taxation liabilities and it is the 
intention to settle these on a net basis
notes to the consolidated financial statements
   78
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
notes to the consolidated financial statements  
221 taxation — income statement
 
 
52 weeks
ended
27 no v ember  
2011
£’000
52 weeks
ended
28 no vember 
2010
£’000
recognised in the income statement
current tax
uk corporation tax on profits of the period —  — 
adjustments in respect of prior periods —  — 
t otal current tax —  — 
deferred tax 
origination and reversal of temporary differences 1920 5000
t otal deferred tax 1920 5000
income tax credit 1920 5000
the tax on the group’s loss before tax differs from the theoretical amount that would arise using the weighted average tax 
rate applicable to losses of the group as follows
 
52 weeks
ended
27 no v ember  
2011
£’000
52 weeks
ended
28 no vember 
2010
£’000
loss before tax 2423 12211
effective tax credit at the uk tax rate of 2668 2010 2800 646 3419
effect of
change in uk corporation tax rate 541  — 
permanent differences 27 138 
t ax losses for which no deferred tax asset recognised 3802 4119
t emporary differences on which no deferred tax recognised 2014  2400 
income tax credit for the period 1920 5000
as announced in the march 2011 budget the standard rate 
of corporation tax in the uk changed from 28 to 26 
with effect from 1 april 2011  this reduction was in addition 
to the decrease to 27 enacted by the finance act 2010  
accordingly the effective rate for the period is 2668
 
the budget also announced a further reduction in the 
standard rate of corporation tax from 26 to 23 phased 
in over three years at 1 per annum from april 2012  the 
change from 26 to 25 with effect from 1 april 2012 was 
enacted in the finance act 2011 and so deferred tax has 
been provided at 25 as the asset is expected to be realised 
on or after 1 april 2012  a deferred tax credit of £05 million 
has been recognised in the current period in respect of this 
further changes have not been substantively enacted at the 
balance sheet date and are therefore not included in these 
financial statements  the proposed reductions are expected 
to be enacted separately each year  the overall effect of the 
further changes from 25 to 23 if applied to the deferred 
tax balance at the balance sheet date would be to reduce the 
deferred tax asset by £08m being £04 million recognised in 
2013 and £04 million recognised in 2014
notes to the consolidated financial statements continued 79 stock code ocdo wwwocadogroupcom
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our financials our performance
222 taxation — balance sheet
movement in the deferred tax asset is as follows 
t ax losses 
carry
forwards
£’000
as at 29 november 2009 2300 
t ax losses recognised through the income statement 5000 
as at 28 november 2010 7300 
effect of change in uk corporation tax rate 541
t ax losses recognised through the income statement 2856 
as at 27 november 2011 9615 
movement in the unrecognised deferred tax asset is analysed below 
 
t ax losses
carry
forwards
£’000
accelerated 
capital 
allowances
£’000
sharebased
payments
£’000
derivative
financial
instruments
£’000
other 
shortterm
timing
differences
£’000
total
£’000
as at 29 november 2009 76910 17334 781 — — 95025 
effect of change in uk corporation 
tax rate 2596 707 6 — —  3309
potential movement in the period 
unrecognised through
— income statement 4119 2459  59 — —  1719
— equity — —  109 — —  109
as at 28 november 2010 70195 19086 607 — — 89888 
adjustments in respect of prior 
period 1106  2221 — — —  3327
effect of change in uk corporation 
tax rate 5217 1413 44 — —  6674
potential movement in the period 
unrecognised through
— income statement 3803 2359  445 77 37  1775
— equity — —  118 — —  118
as at 27 november 2011 60069 17811 — 77 37 77994 
as at 27 november 2011 the group had approximately 
£279 million of unutilised tax losses 2010 approximately 
£287 million available for offset against future profits  a 
deferred tax asset has been recognised in respect of £96 
million 2010 £73 million of such losses the recovery of 
which is supported by the expected level of future profits of 
the group
no deferred tax asset has been recognised in respect of 
the remaining losses on the basis that their future economic 
benefit is uncertain given the unpredictability of future profit 
streams  all tax losses both recognised and unrecognised can 
be carried forward indefinitely
notes to the consolidated financial statements
   80
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
222 taxation — balance sheet continued
movement in the recognised deferred tax liability is analysed below 
 
intangib le   
assets
£’000
as at 28 november 2010 — 
recognised through the income statement 395
as at 27 november 2011 395
as at 27 november 2011 the group recognised a deferred 
tax liability of £04 million in respect of intangible assets 
that management deemed to qualify for research and 
development corporation tax relief  after corporation tax 
relief the timing of tax deductions in respect of expenditure 
incurred on these assets differs to the amortisation profile of 
the assets giving rise to the deferred tax liability  this liability 
will be unwound over the useful lives of the assets
23 loss per share
basic loss per share is calculated by dividing the loss 
attributable to equity holders of the parent by the weighted 
average number of ordinary shares in issue during the period 
excluding ordinary shares held pursuant to the group’s jsos 
and accounted for as treasury shares
diluted loss per share is calculated by adjusting the weighted 
average number of ordinary shares outstanding to assume 
conversion of all dilutive potential shares  the company has 
two categories of potentially dilutive shares namely share 
options and shares held pursuant to the jsos
the calculation for the prior period basic and diluted loss 
per share reflects the conversion of the ordinary shares and 
preference shares from ocado limited to ocado group plc 
on a 1100 basis on 9 february 2010
there was no difference in the weighted average number of 
shares used for the calculation of basic and diluted loss per 
share as the effect of all potentially dilutive shares outstanding 
was antidilutive
basic and diluted loss per share has been calculated as follows
 
52 weeks
ended
27 nov ember 
2011
‘000
52 weeks
ended
28 no vember 
2010
‘000
issued shares at the beginning of the period 520959 400051 
effect of share options exercised in the period 619 927 
effect of treasury shares disposed of in the period 105 — 
effect of shares issued in the period — 41237 
weighted average number of shares at the end of the period 521683 442215 
     
£’000 £’000
loss attributable to the owners of the parent 503 7211
  pence pence
basic and diluted loss per share 010 163
the only transactions involving ordinary shares or potential ordinary shares between the reporting date and the date of these 
financial statements were the exercise of 340000 share options
notes to the consolidated financial statements  
notes to the consolidated financial statements continued 81 stock code ocdo wwwocadogroupcom
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our financials our performance
section 3 — operating assets and liabilities
31 intangible assets
accounting policies
intangible assets
computer software is carried at cost less accumulated 
amortisation and any recognised impairment loss  externally 
acquired computer software and software licences are 
capitalised and amortised on a straightline basis over their 
useful lives of three to seven years  costs relating to the 
development of computer software for internal use are 
capitalised once all the development phase recognition 
criteria of ias 38 “intangible assets” are met  when the 
software is available for its intended use these costs are 
amortised in equal annual amounts over the estimated 
useful life of the software  amortisation and impairment of 
computer software or licences are charged to administrative 
expenses in the period in which they arise  for the group’s 
impairment policy on nonfinancial assets see note 32
311 intangible assets  —  computer software
cost capitalisation
amounts capitalised include the total cost of any external 
products or services and labour costs directly attributable 
to development  management judgement is involved in 
determining the appropriate internal costs to capitalise and 
the amounts involved
estimation of useful life
the charge in respect of periodic amortisation is derived by 
estimating an asset’s expected useful life and the expected 
residual value at the end of its life  increasing an asset’s 
expected life or its residual value would result in a reduced 
amortisation charge in the income statement
the useful life is determined by management at the time the 
software is acquired and brought into use and is regularly 
reviewed for appropriateness  for computer software 
licences the useful life represents management’s view of the 
expected period over which the group will receive benefits 
from the software  for unique software products developed  
and controlled by the group the life is based on historical 
experience with similar products as well as anticipation of 
future events which may impact their useful life such as 
changes in technology
 
27 no v ember  
2011
£’000
28 n o v ember  
2010
£’000
cost 
at the beginning of the period 34362 28503 
additions 2381 717 
disposals 29 — 
internal development costs capitalised 8243 5142 
at the end of the period 44957 34362 
accumulated amortisation
at the beginning of the period 26293 21819
disposals 29 —
charge for the period 5460 4474
at the end of the period 31724 26293
net book value
at the end of the period 13233 8069 
the net book value of computer software held under finance leases is analysed below
 
27 no v ember  
2011
£’000
28 n o v ember  
2010
£’000
cost 4282 2470 
accumulated amortisation 2674 2404
net book value 1608 66 
notes to the consolidated financial statements
   82
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
311 intangible assets  —  computer software 
continued
the movement in cost includes assets of £02 million 2010 
£nil reclassified from owned assets to assets held under 
finance lease following asset based financing arrangements
for the 52 weeks ended 27 november 2011 internal 
development costs capitalised were £82 million 2010 £51 
million and represented approximately 78 2010 88 of 
expenditure on intangible assets and 7 201015 of total 
capital spend including property plant and equipment
32 property plant and equipment
accounting policies
property plant and equipment
property plant and equipment excluding land are stated 
at cost less accumulated depreciation and any recognised 
impairment loss  cost includes the original purchase price of 
the asset and any costs attributable to bringing the asset to its 
working condition for its intended use
depreciation is provided at rates estimated to write off the 
cost of the relevant assets less their estimated residual values 
by equal annual amounts over their expected useful lives 
residual values and expected useful lives are reviewed and 
adjusted if appropriate at the end of each reporting period
land is held at cost and not depreciated  depreciation on 
other noncurrent assets is charged to distribution costs and 
is calculated based on the useful life indicated below
freehold buildings and 
leasehold properties
25 years or the lease term if 
shorter
fixtures and fittings 5–10 years
plant and machinery 3–20 years
motor vehicles 2–5 years
capital workinprogress is not depreciated until it is available 
for use
gains and losses on disposal are determined by comparing 
proceeds with the asset’s carrying amount and are recognised 
within operating profitloss
property plant and equipment represents 54 of the total 
asset base of the group in 2011 2010 33  therefore 
the estimates and assumptions made to determine the 
carrying value of property plant and equipment and related 
depreciation are important to the group’s financial position 
and performance
for more information on the group’s policy on capitalisation 
of borrowings costs see note 43
estimation of useful life
the charge in respect of periodic depreciation is derived by 
estimating an asset’s expected useful life and the expected 
residual value at the end of its life  increasing an asset’s 
expected life or its residual value would result in a reduced 
depreciation charge in the income statement
the useful lives of the group’s assets are determined by 
management at the time the asset is acquired and reviewed 
at least annually for appropriateness  the lives are based on 
historical experience with similar assets as well as anticipation 
of future events which may impact their useful life such as 
changes in technology
impairment of nonfinancial assets
an annual impairment review is performed and assets 
which do not have indefinite useful lives are subject to an 
annual depreciation or amortisation charge  assets that are 
subject to an annual amortisation or depreciation charge 
are reviewed for impairment whenever events or changes in 
circumstances indicate that the carrying amount exceeds its 
recoverable amount  the recoverable amount is the higher 
of an asset’s fair value less cost to sell and value in use  for 
the purpose of assessing impairment assets are grouped at 
the lowest level for which there are separately identifiable 
cash flows cash generating units  nonfinancial assets that 
suffered impairment are reviewed for possible reversal of the 
impairment at the end of each reporting period
given the group’s current operating structure the lowest 
level at which cash flows can reasonably be assessed is for 
the group as a whole  the group prepares detailed forward 
projections which are constantly updated and refined  based 
on these projections the board does not consider that any 
further impairment of assets is required other than that 
recognised in the income statement
notes to the consolidated financial statements  
notes to the consolidated financial statements continued 83 stock code ocdo wwwocadogroupcom
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2106604 08022012 proof 1
our financials our performance
321 property plant and equipment
 
land and 
buildings
£’000
fixtures 
fittings 
plant and 
machinery
£’000
motor 
vehicles
£’000
total
£’000
cost 
at 29 november 2009 35335 112478 22638 170451 
additions 3079 15348 10723 29150 
disposals 173 1483 5936 7592
at 28 november 2010† 38241 126343 27425 192009 
additions 59158 49179 7121 115458 
disposals — 499 2995 3494
at 27 november 2011† 97399 175023 31551 303973 
accumulated depreciation and impairment
at 29 november 2009 9746 57927 12526 80199
charge for the period 1493 13151 4689 19333
impairment — 14 — 14
disposals 149 1483 5936 7568 
at 28 november 2010 11090 69609 11279 91978
charge for the period 1574 14117 5570 21261
impairment — 76 — 76
disposals — 499 2957 3456 
at 27 november 2011 12664 83303 13892 109859
net book value
at 28 november 2010 27151 56734 16146 100031 
at 27 november 2011 84735 91720 17659 194114 
†  cost includes cumulative capitalised borrowing costs of £699000 2010 £147000  the current period capitalisation rate is  
 the same as that incurred on the underlying borrowings being libor plus 35  no borrowing costs were capitalised in the  
 prior period
the net book value of land and buildings comprises
 
27 no v ember  
2011
£’000
28 n o v ember  
2010
£’000
freehold 70105 11274 
short leasehold — less than 50 years 13865 15877 
long leasehold 765 — 
  84735 27151 
notes to the consolidated financial statements
   84
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
321 property plant and equipment continued
the net book value of noncurrent assets held under finance leases is set out below
 
land and
buildings
£’000
fixtures
fittings 
plant and
machinery
£’000
motor
vehicles
£’000
total
£’000
at 28 november 2010
cost 26509 57685 26455 110649 
accumulated depreciation and impairment 10632 32200 10618 53450
net book value 15877 25485 15837 57199 
at 27 november 2011
cost 26588 67762 29721 124071 
accumulated depreciation and impairment 11958 38465 12260 62683
net book value 14630 29297 17461 61388 
the movement in cost includes assets of £97 million 
2010 £21 million reclassified from owned assets to assets 
held under finance lease following asset based financing 
arrangements 
the impairment charge for fixtures fittings plant and 
machinery in both financial periods arises in respect of assets 
that have been superseded
included within property plant and equipment is capital work
inprogress for land and buildings of £600 million 2010 £18 
million and capital workinprogress for fixtures fittings plant 
and machinery of £352 million 2010 £42 million
property plant and equipment with a net book value of £667 
million 2010 £103 million has been pledged as security for 
the secured loans note 412  included in this amount is 
£572 million 2010 £nil relating to assets pledged as security 
for amounts already drawn down under the £100 million 
credit facility
33 availableforsale financial assets
accounting policies
availableforsale financial assets
a vailableforsale financial assets are nonderivatives that are 
either designated in this category or not classified in any of 
the other categories  they are included in noncurrent assets 
unless the investment matures or management intends to 
dispose of it within 12 months of the end of the reporting 
period  management considers that the group’s investments 
fall within this category as explained below
investments
investments are classified as either held for trading or 
availableforsale  there are currently no investments classified 
as held for trading
a vailableforsale investments are held at fair value if this 
can be reliably measured  if the equity instruments are not 
quoted in an active market and their fair value cannot be 
reliably measured the availableforsale investment is carried 
at cost less accumulated impairment  unless the valuation 
falls below its original cost gains and losses arising from 
changes in fair value of availableforsale assets are recognised 
directly in equity  on disposal the cumulative net gain or loss 
is transferred to the statement of comprehensive income 
valuations below cost are recognised as impairment losses 
in the income statement  dividends are recognised in the 
income statement when the right to receive payment is 
established
notes to the consolidated financial statements  
notes to the consolidated financial statements continued 85 stock code ocdo wwwocadogroupcom
governance about oc ado our responsibilities
2106604 08022012 proof 1
our financials our performance
331 availableforsale financial assets
 
27 nov ember 
2011
£’000
28 n o v ember  
2010
£’000
unlisted equity investment — cost and net book value 395 395 
the unlisted equity investment comprises a 25 interest 
in paneltex limited “p aneltex” whose registered office is 
at paneltex house somerden road hull hu9 5pe  the 
group’s 25 interest in p aneltex has not been treated as an 
associated undertaking as the group does not have significant 
influence over the company  in arriving at this decision 
the board has reviewed the conditions set out in ias 28 
“investments in associates” and concluded that despite the 
size of its holding it is unable to participate in the financial and 
operating policy decisions of paneltex due to the position of 
the majority shareholder as executive managing director  the 
relationship between the group and the company is at arm’s 
length
the shares of p aneltex are not quoted in an active market 
and their fair value cannot be reliably measured  as such the 
investment in paneltex is measured at cost less accumulated 
impairment
the group does not intend to dispose of this investment in 
the foreseeable future  if the group did intend to dispose 
of this investment then the anticipated exit route would be 
the sale of shares to the existing shareholder or another 
connected party of paneltex
34 w orking capital
accounting policies
inventories
inventories comprise goods held for resale fuel and other 
consumable goods made up principally of spares  inventories 
are valued at the lower of cost and net realisable value 
goods held for resale and consumables are initially valued on 
a current cost basis and adjustments are made at the financial 
period end to bring this to an average cost basis  fuel stocks 
are valued at calculated average cost  costs include all direct 
expenditure and other appropriate attributable costs incurred 
in bringing inventories to their present location and condition
loans and receivables
loans and receivables are nonderivative financial assets with 
fixed or determinable payments that are not quoted in an 
active market  they are included in current assets except 
for maturities greater than 12 months after the end of the 
reporting period  these are classified as noncurrent assets  
the group’s loans and receivables comprise “t rade and other 
receivables” “shortterm investment” and “cash and cash 
equivalents” in the balance sheet
notes to the consolidated financial statements
   86
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
34 w orking capital continued
trade and other receivables
t rade receivables are recognised initially at fair value and 
subsequently measured at amortised cost using the effective 
interest method less provision for impairment  a provision 
for impairment of trade receivables is established when 
there is objective evidence that the group will not be able 
to collect all amounts due according to the original terms of 
the receivables  significant financial difficulties of the debtor 
probability that the debtor will enter bankruptcy or financial 
reorganisation and default or delinquency in payments more 
than 30 days overdue are considered indicators that the 
trade receivable is impaired  the amount of the provision is 
the difference between the asset’s carrying amount and the 
present value of estimated future cash flows discounted at 
the original effective interest rate  the carrying amount of the 
asset is reduced through the use of an allowance account and 
the amount of the loss is recognised in the income statement 
within administrative expenses  when a trade receivable is 
uncollectible it is written off against the allowance account 
for trade receivables  subsequent recoveries of amounts 
previously written off are credited against administrative 
expenses in the income statement
other receivables are noninterest bearing and are 
recognised initially at fair value and subsequently at amortised 
cost reduced by appropriate allowances for estimated 
irrecoverable amounts
shortterm investments
shortterm investments comprises treasury deposits with a 
maturity of greater than three months at balance sheet date
cash and cash equivalents
cash and cash equivalents comprise cash at bank and in 
hand demand deposits with banks shortterm deposits 
with a maturity of three months or less at the balance sheet 
date and bank overdrafts  bank overdrafts are repayable 
on demand and form an integral part of the group’s cash 
management  they are therefore included as a component of 
cash and cash equivalents
financial liabilities and equity instruments
financial liabilities and equity instruments are classified 
according to the substance of the contractual arrangements 
entered into  an equity instrument is any contract that gives 
a residual interest in the assets of the group after deducting 
all of its liabilities
trade and other payables
t rade and other payables are initially recognised at fair value 
and subsequently at amortised cost using the effective 
interest rate method
341 inventories
 
27 no v ember  
2011
£’000
28 n o v ember  
2010
£’000
goods for resale 12391  11113 
consumables 1919  1367 
  14310  12480 
 write down of inventories  5045  3652
no security has been granted over inventories
notes to the consolidated financial statements  
notes to the consolidated financial statements continued 87 stock code ocdo wwwocadogroupcom
governance about oc ado our responsibilities
2106604 08022012 proof 1
our financials our performance
342 trade and other receivables 
  notes
27 no v ember  
2011
£’000
28 n o v ember  
2010
£’000
t rade receivables 12142  7190 
less provision for impairment of trade receivables 452  270 234
net trade receivables 11872  6956 
other receivables 19112  7260 
prepayments 6264  3634 
accrued income   637  719 
    37885  18569 
no security has been granted over trade and other receivables
included in other receivables is £98 million 2010 £54 million due from suppliers in relation to supplier funded promotional 
activity
the ageing analysis of trade and other receivables excluding prepayments including the provision for impairment is set out 
below
27 november 2011 28 november 2010
 
 gross 
 £’000 
impairment
 £’000 
gross
£’000
impairment
£’000
not past due 30224  —  13222  — 
past due 0–3 months 1459  90 1681  96
past due 3–6 months 118  92 192  86
past due over 6 months 90  88 74  52
  31891  270 15169  234
the provisions account for trade receivables is used to record impairment losses unless the group is satisfied that no recovery 
of the amount owing is possible at that point the amounts considered irrecoverable are written off against trade receivables 
directly  impairment losses are included within administrative expenses in the income statement
t rade receivables that were past due but not impaired amounted to £14 million 2010 £17 million and relate to a number 
of suppliers for whom there is no recent history of default  the ageing analysis of these trade receivables is as follows 
 
27 no v ember  
2011
 £’000 
28 n o v ember  
2010
£’000
past due 0–3 months 1369  1585 
past due 3–6 months 26  106 
past due over 6 months 2  22 
  1397  1713 
343 shortterm investment
 
27 no v ember  
2011
£’000
28 no vember 
2010
£’000
t reasury deposit —  30000 
the shortterm investment relates to a £30 million treasury deposit which matured on 26 july 2011
notes to the consolidated financial statements
   88
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
344 cash and cash equivalents
 
27 no v ember  
2011
£’000
28 n o v ember  
2010
£’000
cash at bank and in hand 92102  124780 
bank overdraft —  141
  92102  124639 
in january 2011 the group cancelled the bank overdraft facility of ocado limited and replaced it with a group composite 
account facility with a gross limit of £5 million and net limit of £nil
cash and cash equivalent balances of the group do not include treasury deposits with maturity dates of over three months  in 
the prior period a treasury deposit of £30 million held by the group was classified as a shortterm investment
£06 million of the group’s cash and cash equivalents are held by the group’s captive insurance company to maintain its 
solvency requirements  therefore these funds are deemed to be restricted and are not available to circulate within the group 
on demand
345 trade and other payables 
 
27 no v ember  
2011
£’000
28 n o v ember  
2010
£’000
t rade payables 50771  34645 
t axation and social security 4361  3851 
accruals 17774  14801 
deferred income 2649  2194 
  75555  55491 
deferred income represents the value of delivery income received under the ”ocado delivery p ass” scheme allocated to 
future periods as well as media income from suppliers which relate to future periods 
35 provisions
accounting policies
provisions are recognised when the group has a present legal or constructive obligation as a result of a past event it is 
probable that an outflow of resources will be required to settle the obligation and the amount can be reliably estimated
insurance claims
provisions for insurance claims relate to potential motor insurance claims and potential public liability claims where accidents 
have occurred but a claim has yet to be made  the provision is made based on estimates provided to ocado by the third
party manager of the ocado cell in atlas insurance pcc limited the “ocado cell”
dilapidations
provisions for dilapidations are recognised on a lease by lease basis and are based on the group’s best estimate of the likely 
committed cash outflow
notes to the consolidated financial statements  
notes to the consolidated financial statements continued 89 stock code ocdo wwwocadogroupcom
governance about oc ado our responsibilities
2106604 08022012 proof 1
our financials our performance
351 provisions
 
insurance claims
£’000
dilapidations
£’000
total
£’000
as at 29 november 2009 —  366  366 
chargedcredited to the income statement
— additional provision 115  203  318 
— unused amounts reversed —  1 1
used during the period —  122 122
as at 28 november 2010 115  446  561 
chargedcredited to the income statement
— additional provision 506  320  826 
— unused amounts reversed —  —  — 
used during the period 27 119 146
as at 27 november 2011 594  647  1241 
analysis of total provisions as at 28 november 2010
 
 
insurance claims
£’000
dilapidations
£’000
total
£’000
current 115  —  115 
noncurrent —  446  446 
  115  446  561 
analysis of total provisions as at 27 november 2011
 
 
insurance 
claims
£’000
dilapidations
£’000
t otal
£’000
current 594  92  686 
noncurrent —  555  555 
  594  647  1241 
insurance claims
the ocado cell uses statistical information built up over several years to estimate as accurately as possible the future outturn 
of the total claims value incurred but not reported as at the balance sheet date  in practice the ocado cell receives newly 
reported claims after the end of the underwriting period that have to be allocated to the year of loss ie the underwriting 
year of occurrence  the calculation of this provision involves estimating a number of variables principally the level of claims 
which may be received and the level of any compensation which may be payable  uncertainty associated with these factors 
may result in the ultimate liability being different from the reported provision  although it is expected that most claims will be 
settled within 12 months of the balance sheet date the exact timing of utilisation of the provision is uncertain
dilapidations
the dilapidations provision is based on the future expected repair costs required to restore the group’s leased buildings and 
vans to their fair condition at the end of their respective lease terms 
the cfc1 lease expires in 2032 with leases for the spokes expiring between 2014 and 2021  contractual amounts are due to 
be incurred at the end of the respective lease terms
leases for vans run for five years with the contractual amount per van due at the end of the five year lease term  if a non
contractual option to extend individual leases for a further six months is exercised by the group the contractual obligation 
remains the same but is deferred by six months
notes to the consolidated financial statements
   90
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
section 4 — capital structure and  
financing costs
41 leases and borrowings
accounting policies
leased assets
leases are classified as finance leases when the terms of 
the lease transfer substantially all the risks and rewards of 
ownership to the group  all other leases are classified as 
operating leases  for property leases the land and building 
elements are treated separately to determine the appropriate 
lease classification
finance leases
assets funded through finance leases are capitalised either 
as property plant and equipment or intangible assets as 
appropriate and are depreciatedamortised over their 
estimated useful lives or the lease term whichever is shorter  
the amount capitalised is the lower of the fair value of the 
asset or the present value of the minimum lease payments 
during the lease term measured at the inception of the lease  
the resulting lease obligations are included in liabilities net of 
finance charges  finance costs on finance leases are charged 
directly to the income statement on the effective interest rate 
basis
operating leases
assets leased under operating leases are not recorded on the 
balance sheet  rental payments are charged directly to the 
income statement on a straightline basis
lease incentives
lease incentives primarily include upfront cash payments or 
rentfree periods  lease incentives are capitalised and spread 
over the period of the lease term
critical accounting estimates and assumptions
the group has a number of complex high value lease 
arrangements  the group follows the guidance of ias 17 
“leases” to determine the classification of leases as operating 
leases versus finance leases  the classification of a lease as a 
finance lease as opposed to an operating lease will change 
ebitda as the charge made by the lessor will pass through 
finance charges and depreciation will be charged on the 
capitalised asset  retained earnings may also be affected 
depending on the relative size of the amounts apportioned 
to capital repayments and depreciation  ias 17 “leases” 
requires the group to consider splitting property leases into 
their component parts ie land and building elements  as 
only the building elements could be considered as a finance 
lease management must make a judgement based on advice 
from suitable experts as to the relative value of the land and 
buildings
loans and borrowings
interest bearing bank loans and overdrafts are initially 
recorded at fair value net of attributable transaction costs  
subsequent to initial recognition interest bearing borrowings 
are stated at amortised cost with any difference between 
cost and redemption value being capitalised to qualifying 
assets or recognised in the income statement over the period 
of the borrowings on the effective interest rate basis  interest 
bearing borrowings have been subcategorised on the balance 
sheet as borrowings and obligations under finance leases
notes to the consolidated financial statements  
notes to the consolidated financial statements continued 91 stock code ocdo wwwocadogroupcom
governance about oc ado our responsibilities
2106604 08022012 proof 1
our financials our performance
411 borrowings and finance leases
  notes
27 nov ember 
2011
£’000
28 no vember 
2010
£’000
current liabilities
borrowings 412 3270 2282 
obligations under finance leases 413 19643 16485 
  22913 18767 
noncurrent liabilities
borrowings 412 45793 9774 
obligations under finance leases 413 42561 45573 
  88354 55347 
t otal borrowings and finance leases 111267 74114 
412 borrowings
 
less than 
one year
£’000
between 
one year and
two years
£’000
between 
two years
and five years
£’000
total
£’000
as at 28 november 2010
secured loans 2145 3718 6056 11919 
unsecured loans 137 — — 137 
total borrowings 2282 3718 6056 12056 
as at 27 november 2011
secured loans 3270 3160 42633 49063 
t otal borrowings 3270 3160 42633 49063 
the secured loans outstanding at period end can be analysed as follows
principal
 amount
£’000 inception secured over
current 
interest rate
instalment 
frequency
final payment 
due
carrying 
value as at 
27 nov ember 
2011
£’000
carrying 
value as at 28 
november 
2010
£’000
8000 may07
certain 
warehouse assets
clearing bank 
base rate  30 quarterly feb15 5579 7158
1530 dec06
freehold 
property
clearing bank 
base rate  15 quarterly feb12 803 956
1466 feb09
freehold 
property libor  225 quarterly feb12 1063 1210
2848 dec09
freehold 
property libor  35 quarterly jan13 2328 2595
40234 jul10
property plant 
and equipment libor  35 note
 
† jan14 39290 — 
            49063 11919
disclosed as
current 411 3270 2282
noncurrent 411 45793 9774 
  49063 12056 
†  no capital repayments are due on the £100 million credit facility until 5 january 2014  it is the group’s intention to  
 refinance the facility at that time in accordance with the longterm capital management strategy of the group  the carrying  
 value as at 27 november 2011 is net of capitalised transaction costs details of the associated covenants of this facility can  
 be found in the directors’ report on page 63 
there were no unsecured loans outstanding at period end 2010 £01 million
notes to the consolidated financial statements
   92
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
413 obligations under finance leases
 
27 nov ember 
2011
£’000
28 no vember 
2010
£’000
obligations under finance leases due
within one year 19643 16485 
between one and two years 18127 16121 
between two and five years 17512 21947 
after five years 6922 7505 
t otal obligations under finance leases 62204 62058 
  notes
27 no v ember  
2011
£’000
28 no vember 
2010
£’000
minimum lease payments due
within one year 23072 20087 
between one and two years 20217 18576 
between two and five years 20019 24546 
after five years 7921 9459 
71229 72668 
less future finance charges 9025 10610
present value of finance lease liabilities 62204 62058 
disclosed as
current 411 19643 16485 
noncurrent 411 42561 45573 
  62204 62058 
the existing finance lease arrangements entered into by the group contain no restrictions concerning dividends additional 
debt and further leasing  furthermore no material leasing arrangements exist relating to contingent rent payable renewal or 
purchase options and escalation clauses
42 analysis of net debtcash
421 net debtcash
 
  notes
27 no v ember  
2011
£’000
28 no vember 
2010
£’000
current assets
cash and cash equivalents 344 92102 124639 
shortterm investment 343 — 30000 
  92102 154639 
current liabilities
borrowings 412 3270 2282
obligations under finance leases 413 19643 16485
  22913 18767
noncurrent liabilities
borrowings 412 45793 9774
obligations under finance leases 413 42561 45573
  88354 55347
t otal net debtcash   19165 80525 
notes to the consolidated financial statements  
notes to the consolidated financial statements continued 93 stock code ocdo wwwocadogroupcom
governance about oc ado our responsibilities
2106604 08022012 proof 1
our financials our performance
422 reconciliation of net cash flow to movement in net debtcash
 
 
27 no v ember  
2011
£’000
28 n o v ember  
2010
£’000
net decreaseincrease in cash and cash equivalents 32802 111622 
exchange adjustments 265 — 
decreaseincrease in shortterm investment 30000 30000 
net increasedecrease in debt and lease financing 27883 56430 
noncash movements
— assets acquired under finance lease 9270 10479
movement in net debtcash in the period 99690 187573 
opening net cashdebt 80525 107048
closing net debtcash 19165 80525 
43 finance income and costs
accounting policy
borrowing costs
borrowing costs which are directly attributable to the acquisition or construction of qualifying assets are capitalised  they are 
defined as the borrowing costs that would have been avoided if the expenditure on the qualifying asset had not been made  
all other borrowing costs which are not capitalised are charged to finance costs using the effective interest rate method
431 finance income and costs
 
52 weeks
ended
27 nov ember 
2011
£’000
52 weeks
ended
28 n o v ember  
2010
£’000
interest on cash balances and shortterm investment 1164 557 
other interest 4 12 
fair value movement in derivative financial instruments — 933 
finance income   1168 1502 
borrowing costs
— bank loans and overdrafts 17 31
— obligations under finance leases 4080 4356
— borrowings 957 3970
capitalised borrowing costs 552 — 
fair value movement on derivative financial instruments 161 — 
finance costs   4663 8357
net finance costs 3495 6855
the current period fair value movement on the derivative financial instruments arose from fair value adjustments on the 
group’s cash flow hedges  the prior period fair value movement on the derivative financial instruments arose from fair value 
adjustments on warrant agreements
included in interest on borrowings is an amount of £nil 2010 £197000 relating to the accelerated amortisation of prepaid 
arrangement fees
notes to the consolidated financial statements
   94
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
44 derivative financial instruments
accounting policies
derivative financial instruments
derivative financial instruments are initially recognised at fair 
value on the contract date and are subsequently measured 
at their fair value at each balance sheet date  the method of 
recognising the resulting fair value gain or loss depends on 
whether the derivative is designated as a hedging instrument 
and the nature of the item being hedged  at 27 november 
2011 the group’s derivative financial instruments consist 
of interest rate swaps which are designated as cash flow 
hedges of the future interest payments  and forward foreign 
exchange contracts which are designated as cash flow hedges 
of highly probable forecast transactions
the group documents at the inception of the hedge the 
relationship between hedging instruments and hedged 
items the risk management objectives and strategy and 
its assessment of whether the derivatives that are used in 
hedging transactions are highly effective in offsetting changes 
in fair values or cash flows of hedged items 
this assessment is performed retrospectively at each financial 
reporting period  movements on the hedging reserve within 
shareholders’ equity are shown in the consolidated statement 
of comprehensive income  the full fair value of hedging 
derivatives are classified as current when the remaining 
maturity of the hedged item is less than 12 months
cash flow hedging
the effective portion of changes in the fair value of 
derivatives that are designated as cash flow hedges and 
qualify for hedge accounting is recognised in equity  amounts 
accumulated in equity are recycled in the income statement 
in the periods when the hedged item affects profit or 
loss  when the hedged forecast transaction results in the 
recognition of property plant and equipment the gains or 
losses previously deferred in equity are included in the initial 
cost of the asset and are ultimately recognised in profit or 
loss within the depreciation expense  during the period all 
the group’s cash flow hedges were 100 effective and there 
is therefore no ineffective portion recognised in profit or loss
forward foreign exchange contracts
the notional principal amounts of the outstanding forward 
foreign exchange contracts at 27 november 2011 were 
€316 million 2010 €176 million  the corresponding 
amounts in sterling at 27 november 2011 were £274 million 
2010 £141 million
the hedged highly probable forecast transactions 
denominated in foreign currency are expected to occur 
at various dates during the next ten months  cumulative 
gains and losses recognised in the hedging reserve within 
other comprehensive income are £14 million 2010 £08 
million  these gains are recognised in the income statement 
in periods during which the hedged forecast transaction 
affects the income statement which for property plant and 
equipment is over the useful life of the asset three to 25 
years 
interest rate swaps
the group has entered into interest rate swaps to convert 
interest payable on certain floating rate debt from a variable 
to a fixed interest rate  as at 27 november 2011 the 
notional amount of interest rate swaps was £254 million 
2010 £nil representing 5025 2010 nil of gross group 
borrowings 
the swaps have been accounted for as cash flow hedges with 
interest payable on noncurrent borrowings designated as 
the hedged item  the hedged item and the hedging interest 
have the same critical terms and thus all hedges were highly 
effective for the period
441 derivative financial instruments
 
27 nov ember 
2011
£’000
28 no vember
 2010
£’000
derivative asset
forward foreign exchange contracts cash flow hedges 11 472 
derivative liability   
forward foreign exchange contracts cash flow hedges 266 — 
interest rate swaps cash flow hedges 52 — 
  318  —  
notes to the consolidated financial statements  
notes to the consolidated financial statements continued 95 stock code ocdo wwwocadogroupcom
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notes to the consolidated financial statements
  
45 financial instruments
accounting policies
financial assets and financial liabilities are recognised on the 
balance sheet when the group becomes a party to the 
contractual provisions of the instrument
the group classifies its financial instruments in the following 
categories
 z a vailableforsale
 z loans and receivables
 z other financial liabilities at amortised cost and
 z financial assets and liabilities at fair value through the 
profit or loss
the classification depends on the purpose for which the 
financial assets and liabilities were acquired  management 
determines the classification of its financial instruments at 
initial recognition or in certain circumstances on modification
offsetting financial instruments
financial assets and liabilities are offset and the net amount
reported in the balance sheet when there is a legally 
enforceable right to offset the recognised amounts and there 
is an intention to settle on a net basis or realise the asset and 
settle the liability simultaneously
impairment of financial assets
assets carried at amortised cost
the group assesses whether there is objective evidence 
that a financial asset is impaired at the end of each reporting 
period  a financial asset is impaired and an impairment loss 
recognised if there is objective evidence of impairment as a 
result of a loss event that occurred after the initial recognition 
of the asset and the loss event has an impact on the 
estimated future cash flows of the financial assets that can be 
reliably estimated
the criteria that the group uses to determine that there is 
objective evidence of an impairment loss include but are not 
limited to
 z financial difficulty indicators
 z breach of contract such as missed payments
 z fraud
 z bankruptcy and
 z disappearance of an active market
the amount of the loss is measured as the difference 
between the asset’s carrying value and the present value of 
estimated future cash flows discounted at the financial asset’s 
original effective interest rate  the asset’s carrying value is 
reduced and the loss recognised in the income statement
 
if in a subsequent period the impairment loss decreases and 
the decrease can be related objectively to an event occurring 
after the impairment was recognised the reversal of the 
previously recognised impairment loss is recognised in the 
income statement
availableforsale financial assets
equity investments classified as availableforsale and held 
at cost are reviewed annually to identify if an impairment 
loss has occurred  the amount of the impairment loss is 
measured as the difference between the carrying value of the 
financial asset and the present value of estimated future cash 
flows discounted at the current market rate of return for a 
similar financial asset  impairment losses recognised in the 
income statement on equity investments are not reversed
451 fair value of financial instruments
financial instruments carried at fair value in the balance sheet 
comprise the derivative assets and liabilities see note 441  
the group uses the following hierarchy for determining and 
disclosing the fair value of these financial instruments
 z quoted prices unadjusted in active markets for identical 
assets or liabilities level 1
 z inputs other than quoted prices included within level 
1 that are observable for the asset and liability either 
directly or indirectly level 2
 z inputs for the assets or liabilities that are not based on 
observable market data that is unobservable inputs 
level 3 
the group’s derivative assets and liabilities are classified as 
level 2  96
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
451 fair value of financial instruments continued
set out below is a comparison by category of carrying values and fair values of all financial instruments that are included in the 
financial statements 
27 november 2011 28 november 2010
  notes
carrying
value
£’000
fair value
£’000
carrying 
value
£’000
fair value
£’000
financial assets
cash and cash equivalents 344 92102  92102  124639  124639 
shortterm investment 343 —  —  30000  30000 
t rade receivables 342 11872  11872  6956  6956 
other receivables incl accrued income  
excl prepayments 342 19749  19749  7979  7979 
derivative asset 441 11  11  472  472 
a vailableforsale financial asset 331 395  395  395  395 
t otal financial assets   124129  124129  170441  170441 
financial liabilities
t rade payables 345 50771 50771 34645 34645
accruals 345 17774 17774 14801 14801
borrowings 412 49063 44741  12056 11739
finance lease obligations 413 62204 62204 62058 62058
derivative liability 441 318 318 —  — 
t otal financial liabilities   180130 175808 123560 123243
the derivative asset relates to forward foreign exchange 
contracts the fair value of which was determined with 
reference to the forward rate to the date of maturity for all 
such contracts at period end
the derivative liability relates to forward foreign exchange 
contracts and interest rate swaps  the fair value of the 
forward foreign exchange contracts was determined with 
reference to the forward rate to the date of maturity for all 
outstanding forward foreign exchange contracts at period 
end  the fair value of the interest rate swaps was determined 
with reference to the fixed rate to the date of maturity for all 
outstanding interest rate swaps at period end
the group’s only availableforsale financial asset consists of 
an unlisted equity investment of which the fair value cannot 
be reliably determined and which is therefore measured at 
cost  there has been no movement in this investment during 
the period
the fair values of cash and cash equivalents the shortterm 
investment receivables payables and accruals and borrowings 
of a maturity of less than one financial period are assumed to 
approximate to their carrying values but for completeness are 
included in this analysis
the interest rate used to discount borrowings is based on a 
libor plus margin measure blended for the type of security 
offered and was calculated as 5 2010 5  
the fair values of all other financial assets and liabilities have 
been calculated by discounting the expected future cash flows 
at prevailing market interest rates
452 credit risk
the group’s exposures to credit risk arise from holdings of 
cash and cash equivalents a shortterm investment trade and 
other receivables excluding prepayments and derivative 
assets
exposure to credit risk
the carrying value of these financial assets as set out in note 
451 represents the maximum credit exposure  no collateral 
is held as security against these assets
cash and cash equivalents and shortterm investment
the group’s exposure to credit risk on cash and cash 
equivalents and the shortterm investment is managed by 
investing in banks and financial institutions with strong credit 
ratings and by regular review of counterparty risk in light of 
the current economic climate  the group’s guideline is to 
maintain transactional bank accounts and term deposits with 
financial institutions which carry a moody’s rating of aa3p1 
for longterm and shortterm deposits 
notes to the consolidated financial statements  
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notes to the consolidated financial statements
  
452 credit risk continued
trade and other receivables
t rade and other receivables at the period end comprise mainly monies due from suppliers which are considered of a good 
credit quality  the group provides for doubtful receivables in respect of monies due from suppliers
the group has very low retail credit risk due to transactions being principally of a high volume low value and short maturity 
and the group’s effective controls over this area  the group has provided for doubtful receivables in respect of consumer 
sales by reviewing the ageing profile and based on prior experience assessing the recoverability of overdue balances
movements in the provision for the impairment of trade and other receivables are as follows
  notes
27 nov ember 
2011
£’000
28 no vember 
2010
£’000
at the beginning of the period 234 189
increase in provision for impairment of receivables  251 304
uncollectible amounts written off 215  217 
recovery of amounts previously provided   —  42 
at the end of the period 342 270 234
453 liquidity risk
to manage the working capital needs of the business the group is reliant on being able to negotiate sufficient financing 
arrangements  to achieve this the group maintains a mixture of short and mediumterm debt and lease finance arrangements 
that are designed to ensure it has sufficient available funds to finance its operations  during the period the group cancelled 
its committed standby bank overdraft facility of £5 million and replaced it with a group composite account facility with the 
requirement that the aggregate of favourable cash balances offset adverse cash balances with a limit of £5 million adverse 
balance on any one account within the group
the group monitors its liquidity requirements to ensure it has sufficient cash to meet operational needs while maintaining 
sufficient headroom on its undrawn committed borrowing facilities at all times so that the group does not breach borrowing 
limits or covenants where applicable on any of its borrowing facilities  for further details see note 48
the table below analyses the group’s financial liabilities into relevant maturity groupings based on the remaining period at 
the balance sheet date to the contractual maturity date  the amounts disclosed in the table are the carrying values and 
undiscounted contractual cash flows
 
  notes 
carrying 
value
£’000
contractual 
cash flows
£’000
1 year  
or less
£’000
1–2  
years
£’000
2–5  
years
£’000
more than 
5 years
£’000
financial liabilities
t rade payables 345 34645 34645 34645 —  —  — 
accruals 345 14801 14801 14801 —  —  — 
secured loans 412 11919 12891 2580 4033 6278 — 
unsecured loans 412 137 141 141 —  —  — 
obligations under 
finance leases 413 62058 72668 20087 18576 24546 9459
28 november 2010   123560 135146 72254 22609 30824 9459 98
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
453 liquidity risk continued
 
  notes
carrying 
value
£’000
contractual 
cash flows
£’000
1 year  
or less
£’000
1–2  
years
£’000
2–5  
years
£’000
more than 
5 years
£’000
financial liabilities
t rade payables 345 50771 50771 50771 —  —  — 
accruals 345 17774 17774 17774 —  —  — 
secured loans 412 49063 54825 5999 5764 43062 — 
obligations under 
finance leases 413 62204 71229 23072 20217 20019 7921
derivative liabilities 441 318 318 315 3 — —
27 november 2011   179812 190322 95653 24023 62725 7921
454 market risk
currency risk
the group has foreign currency exposure in relation to its foreign currency trade payables and a portion of its cash and cash 
equivalents
foreign currency trade payables arise principally on purchases of plant and equipment  euro bank accounts are maintained 
in order to minimise the group’s exposure to fluctuations in the euro relating to current and future purchases of plant and 
equipment  forward foreign exchange contracts are entered into to hedge future purchases of plant and equipment in euro
the group’s exposure to currency risk is based on the following amounts
 
27 nov ember 
2011
£’000
28 no vember 
2010
£’000
cash and cash equivalents — euro 507  5318 
t rade payables at period end — euro 768 1254
derivative liabilityasset forward foreign exchange contracts — euro 255  472 
  516  4536 
the table below shows the group’s sensitivity to changes in foreign exchange rates on its eurorelated financial instruments
27 november 2011 28 november 2010
 
 increase 
decrease in 
income 
 £’000 
 increase 
decrease in 
equity 
 £’000 
 increase 
decrease in 
income 
£’000
 increase 
decrease in 
equity 
£’000
10 appreciation of the euro 143  2718  760  1453 
10 depreciation of the euro 130  2471  734 1324
a strengthening of the euro as indicated against sterling at 27 november 2011 would have increaseddecreased equity 
and profit or loss by the amounts detailed above   this analysis is based on foreign currency exchange rate variances that the 
group considered to be reasonably possible at the end of the period   the analysis assumes that all other variables remain 
constant
notes to the consolidated financial statements  
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notes to the consolidated financial statements
  
454 market risk continued
interest rate risk
the group is exposed to interest rate risk on its floating rate interest bearing borrowings and floating rate cash and cash 
equivalents  the group’s interest rate risk policy seeks to minimise finance charges and volatility by structuring the interest rate 
profile into a diversified portfolio of fixed rate and floating rate financial assets and liabilities  interest rate risk on significant 
floating rate interest bearing borrowings is managed using interest rate swaps
at the balance sheet date the interest rate profile of the group’s interest bearing financial instruments was
 
27 nov ember 
2011
£’000
28 no vember 
2010
£’000
fixed rate instruments
financial assets 41737 79628 
financial liabilities 62204  62195
variable rate instruments
financial assets 50366  75011 
financial liabilities   49063 11919
sensitivity analysis
an increase of 100 basis points 10 in interest rates at the balance sheet date will increase equity and profit or loss by the 
amounts shown below  a rate of 100 basis points was deemed appropriate considering the current shortterm interest rate 
outlook  this calculation assumes that the change occurred at the balance sheet date and had been applied to risk exposures 
existing at that date  this analysis assumes that all other variables remain constant and considers the effect on financial 
instruments with variable interest rates
 
27 nov ember 
2011
£’000
28 no vember 
2010
£’000
equity
gain 349  600 
income
gain 349  600  100
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
455 financial instruments by category
the group has categorised its financial instruments as follows
  notes
a vailable 
forsale
£’000
loans and 
receivables
£’000
financial 
liabilities at 
amortised 
cost
£’000
financial  
assets and 
liabilities at 
fair value 
through 
profit and 
loss
£’000
total 
£’000
as at 28 november 2010
financial assets as per the balance sheet
cash and cash equivalents 344 —  124639  —  —  124639 
t rade and other receivables 
excluding prepayments 342 —  44935  —  —  44935 
a vailableforsale financial asset 331 395  —  —  —  395 
derivative asset 441 —  —  —  472  472 
  395  169574  —  472  170441 
financial liabilities as per the balance sheet
t rade payables 345 —  —  34645  —  34645 
accruals 345 —  —  14801  —  14801 
borrowings 412 —  —  12056  —  12056 
obligations under finance leases 413 —  —  62058  —  62058 
  —  —  123560  —  123560 
  notes
available 
forsale
£’000
loans and 
receivables
£’000
financial 
liabilities at 
amortised 
cost
£’000
financial 
assets and 
liabilities at 
fair value 
through 
profit and 
loss
£’000
t otal 
£’000
as at 27 november 2011
financial assets as per the balance sheet
cash and cash equivalents 344 —  92102  —  —  92102 
t rade and other receivables 
excluding prepayments 342 —  31621  —  —  31621 
a vailableforsale financial asset 331 395  —  —  —  395 
derivative asset 441 —  —  —  11  11 
  395  123723  —  11  124129 
financial liabilities as per the balance sheet
t rade payables 345 —  —  50771  —  50771 
accruals 345 —  —  17774  —  17774 
borrowings 412 —  —  49063  —  49063 
obligations under finance leases 413 —  —  62204  —  62204 
derivative liability 441 —  —  —  318 318
  —  —  179812  318 180130 
notes to the consolidated financial statements  
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notes to the consolidated financial statements
  
46 share capital and reserves
accounting policy
equity instruments issued by the group are recorded at the proceeds received net of direct issue costs
461 share capital and reserves
27 november 2011 28 november 2010
 
number of 
shares £’000
number of 
shares £’000
authorised
ordinary shares of 2 pence each 600000000 12000 600000000 12000 
allotted and fully paid
ordinary shares of 2 pence each 558362139 11167 553428201 11068 
included in the total number of ordinary shares outstanding above are 36305099 2010 32476700 shares held by the 
group’s employee benefit trust see note 461a
as at 27 november 2011 the number of ordinary shares available for issue under the block listing facility were 4352024 
2010 5276413  these ordinary shares will only become allotted when share options under the group’s esos and 
nonemployee share options have been exercised and are therefore not included in the total number of ordinary shares 
outstanding above 102
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
461 share capital and reserves continued
the movements in the called up share capital and share premium accounts are set out below
  notes
ordinary 
shares
number of 
shares
convertible 
preference 
shares
number of 
shares
ordinary 
shares
£’000
convertible 
preference 
shares
£’000
share 
premium
£’000
at 29 november 2009 1525757 2474749 15 25 310836 
allotted in respect of executive share 
ownership scheme of ocado limited 471a 6635 — — — 731 
allotted in respect of joint share 
ownership scheme of ocado 
limited 471b 324767 — 3 — 48712 
cancellation of ocado limited 
ordinary and convertible 
preference shares 461b 1857159 2474749 18 25 — 
issue of ordinary and convertible 
preference shares by ocado group plc 461b 185715900 247474900 204287 272222 — 
ocado group plc capital reduction 461b — — 200573 267273 — 
reverse acquisition of ocado 
limited by ocado group plc 461c — — — — 360279
issue of ordinary shares by ocado 
group plc on ipo 118968225 — 2379 — 211763 
issue of ordinary shares to the 
chairman on ipo 55555 — 1 — 99 
share issue costs — — — — 6881
conversion of preference shares to 
ordinary shares on ipo 247474900 247474900 4949 4949 — 
allotted in respect of the executive 
share ownership scheme of ocado 
group plc 471a 1032921 — 21 — 978 
allotted in respect of non
employee share options issued by 
ocado group plc 471c  180700 — 4 — 135 
at 28 november 2010 553428201 — 11068 — 206094 
allotted in respect of executive 
share ownership scheme 471a 935137 — 19 — 940 
allotted in respect of joint share 
ownership scheme 471b 3990799 — 80 — 6704 
allotted in respect of sharesave 
scheme 471d 602 — — — 1 
allotted in respect of non
employee share options 471c 7400 — — — 7 
disposal of treasury shares — — — — 37 
at 27 november 2011 558362139 — 11167 — 213783
the ordinary shares held by the trustee of the group’s employee benefit trust pursuant to the joint share ownership scheme 
are treated as treasury shares in the group’s consolidated balance sheet in accordance with ias 32 ‘‘financial instruments 
presentation’’  these ordinary shares have voting rights but these have been waived by the trustee  the number of allotted 
called up and fully paid shares at the end of each period differs from that used in the loss per share calculation in note 23 as 
loss per share is calculated using the weighted average number of ordinary shares in issue during the period excluding treasury 
shares
notes to the consolidated financial statements  
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461 share capital and reserves continued
in the prior period convertible preference shares were 
convertible into the same number of ordinary shares either 
at the option of the holder or on the occurrence of certain 
trigger events including a public listing  the convertible 
preference shares ranked pari passu with ordinary shares 
with the exception that on return of assets on a liquidation 
reduction of capital or otherwise the holders of the 
convertible preference shares shall be entitled in respect 
of their preference shares in proportion to the number of 
such shares held by each of them in priority to all other 
shareholders to the surplus assets of the company remaining 
after payment of its liabilities the subscription price for their 
preference shares together with a sum equal to any arrears of 
dividends declared calculated down to the date of the return 
of assets
on 9 february 2010 the company acquired the entire share 
capital of ocado limited  as a result of this transaction 
the shareholders in ocado limited received shares in the 
company in direct proportion to their original shareholdings 
in ocado limited  shareholders were issued 100 shares in 
the company for every one share in ocado limited  the 
shares in the company have a nominal value of 2 pence each  
on 26 july 2010 the company’s shares were admitted to the 
premium listing segment of the official list of the uk listing 
authority and to trading on the main market of the london 
stock exchange the “listing”  in conjunction the company 
made an initial public offering “ipo” of 118968225 
new 2 pence ordinary shares at a price of 180 pence per 
ordinary share  also in conjunction 247474900 convertible 
preference shares converted to ordinary shares
also in the prior period costs relating directly to the new 
issue of shares to the amount of £69 million were deducted 
from the share premium account  attributable ipo costs 
were allocated between the share premium account and 
profit and loss account in proportion to the number of 
primary and secondary shares traded on admission  other 
costs attributable to the listing were expensed
in the prior period costs expensed in the amount of £35 
million in relation to the ipo related primarily to legal and 
professional fees
the movements in reserves other than share premium are 
set out below
other reserves
  notes
t reasury 
shares 
reserve
£’000
reverse 
acquisition 
reserve
£’000
fair value 
reserve
£’000
foreign 
currency 
translation 
reserve
£’000
at 29 november 2009 —  —  —  — 
allotted in respect of joint share ownership 
scheme of ocado limited 471b 47741 —  —  — 
issue of ordinary and convertible preference 
shares by ocado group plc 461b —  476509 —  — 
reverse acquisition of ocado limited by ocado 
group plc 461c —  360279  —  — 
fair value movement on derivative financial 
instrument 461d —  —  726  — 
at 28 november 2010 47741 116230 726  — 
allotted in respect of joint share ownership 
scheme 471b 6308 — — — 
disposal of treasury shares 244 — — — 
fair value movement on derivative financial 
instrument 461d — — 716 — 
t ranslation of foreign subsidiary — — — 1
at 27 november 2011 53805 116230 10 1 104
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
461 share capital and reserves continued
a treasury shares reserve
this reserve arose in the prior period when ocado limited 
prior to the group’s restructuring issued equity share 
capital under the jsos which is held in trust by the trustee 
of the group’s employee benefit trust  during the current 
period the company issued a further 3990799 ordinary 
shares to the group’s employee benefit trust pursuant to 
a new phase of the group’s jsos  the consideration paid 
is deducted from total shareholders’ equity and classified as 
treasury shares on consolidation  t reasury shares cease to 
be accounted for as such when they are sold or the interest 
is transferred in full to the participant pursuant to the terms 
of the jsos  see note 471b for more information on the 
jsos
b scheme of arrangement and capital reduction
on 9 february 2010 pursuant to a scheme of arrangement 
all of ocado limited’s ordinary and convertible preference 
shares were cancelled  immediately thereafter ocado limited 
issued 100 ordinary shares to the company for £1 and 
in consideration of that and of the cancellation of ocado 
limited’s ordinary and preference shares the company issued 
185715900 ordinary shares and 247474900 convertible 
preference shares on the basis of 100 ordinary andor 
preference shares for each ocado limited ordinary share 
andor preference share held  the effect of the scheme of 
arrangement was to replicate the shareholders’ register of 
ocado limited at the company level
on 16 february 2010 pursuant to an order of the court 
confirming the reduction of capital of the company the 
company’s share capital was reduced by decreasing the 
nominal value of each ordinary and convertible preference 
share issued pursuant to the scheme of arrangement from 
110 pence to 2 pence  this created distributable reserves of 
£4678 million
c reverse acquisition reserve
the acquisition by the company of the entire issued share 
capital of ocado limited has been accounted for as a 
reverse acquisition under ifrs 3 revised  consequently the 
previously recognised book values and assets and liabilities 
have been retained and the consolidated financial information 
for both the current and prior periods have been presented 
as if the company had always been the parent company of 
the group
d other reserves
other reserves consist of the foreign currency translation 
reserve and the fair value reserve
the fair value reserve comprises gains and losses on the fair 
value movements of the group’s cash flow hedges
the foreign currency translation reserve is used to record 
exchange differences arising from the translation of the 
financial statements of an indirect foreign subsidiary of the 
company ocado information t echnology limited which is 
incorporated in the republic of ireland and whose functional 
currency is the euro
47 sharebased payments
accounting policies
employee benefits
employees including directors of the group receive 
remuneration in the form of sharebased payments whereby 
employees render services in exchange for rights over 
shares “equitysettled transactions”  the cost of equity
settled transactions with employees is measured with 
reference to the fair value at the date on which they are 
granted  fair value is measured using the blackscholes 
option pricing model  the expected life used in the model 
has been adjusted based on management’s best estimate 
for the effects of nontransferability exercise restrictions 
and behavioural considerations  in valuing equitysettled 
transactions no account is taken of any performance 
conditions
the cost of equitysettled transactions is recognised together 
with a corresponding increase in equity over the years in 
which the performance conditions are fulfilled ending on the 
date on which the relevant employees become fully entitled 
to the award “vesting date”
at each reporting date the cumulative expense recognised 
for equitysettled transactions reflects the extent to which the 
vesting period has expired and the number of awards that in 
the opinion of the directors will ultimately vest  directors’  
estimates are based on the best available information at that 
date
no expense is recognised for awards that do not ultimately 
vest except for awards where vesting is conditional upon a 
market condition which are treated as vesting irrespective 
of whether or not the market condition is satisfied provided 
that all other performance conditions are satisfied
the group has exposure in respect of cashsettled share
based payment transactions and sharebased payment 
transactions with cash alternatives as defined by ifrs 2 
“sharebased payment” only in respect of bad leaver 
provisions in the group’s jsos
notes to the consolidated financial statements  
notes to the consolidated financial statements continued 105 stock code ocdo wwwocadogroupcom
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our financials our performance
notes to the consolidated financial statements
  
471 share options and other equity 
instruments
the group currently operates three employee share 
incentive schemes namely the executive share ownership 
scheme the “esos” the joint share ownership scheme the 
“jsos” and the sharesave scheme
the total expense for the period relating to employee share
based payment plans was £06 million 2010 £03 million 
all of which related to equitysettled sharebased payment 
transactions except for £01 million in the prior period 
relating to a cashsettled sharebased payment
a esos
the group’s esos is an equitysettled share option scheme 
approved by hmrc  options may also be granted under 
the terms of a schedule which is not so approved  the esos 
was established by ocado in 2001
under the esos ocado or the trustees of an employee trust 
may grant options over shares in the company to eligible 
employees  the eligible employees to whom options are 
granted and the terms of such options will be determined 
by the directors of ocado or the trustees  the employees 
who are eligible to participate in the esos are all ocado’s 
executive directors and employees including the employees 
of the company’s subsidiaries  options are not transferable
the exercise price of options may not be less than the 
market value of the company’s shares on the date of grant  
if the trustees or the directors have determined that the 
exercise of an option will be satisfied by the issue of ordinary 
shares the exercise price may also not be less than the 
nominal value of ordinary shares
the directors of ocado or the trustees may impose a 
performance target and any further condition determined 
to be appropriate on the exercise of an option  any 
performance target must generally be measured over a 
period of at least three years  there are currently no options 
granted which are subject to performance targets that have 
not yet been met
the vesting period for the esos is three years  if the options 
remain unexercised after a period of ten years from the 
date of grant or the employee leaves the group the options 
expire subject to a limited number of exceptions
on 9 february 2010 the ordinary shares and convertible 
preference shares in ocado limited were converted into 
ordinary shares and convertible preference shares in ocado 
group plc on a 1100 basis with a nominal value of 2 pence 
per ordinary share  the prior period opening balance and 
movements during the prior period have been disclosed as if 
the conversion occurred at the beginning of that period 106
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
471 share options and other equity instruments continued
at each respective balance sheet date the outstanding options were as follows
 
year of 
issue 
27 nov ember 
2011
exercise 
price £ 
28 no vember 
2010
exercise 
price £ exercise period 
approved 2001 260308  080  593725  080 210803 – 291111 
2001 17744  090  17744  090 301104 – 291111 
2002 59162  090  128181  090 310505 – 291112 
2003 97194  090  120053  090 310506 – 291113 
2004 123385  090  183426  090 310507 – 291114 
2005 255088  100  367789  100 310508 – 291115 
2005 66866  115  70170  115 310508 – 300515 
2006 86320  140  138890  140 310509 – 300516 
2006 86327  150  115028  150 301109 – 291116 
2007 414270  150  587939  150 310510 – 291117 
2008 166816  135  225578  135 301111 – 291118 
2008 393212  120  445751  120 310511 – 300518 
2009 225796  120  240554  120 310512 – 300519 
2009 1182523  135  1354121  135 021112 – 291119 
2010 981348  165  1151593  165 300613 – 290620 
2011 325811  189  —  — 190714 – 180721 
  2011 805243  255 —  — 140214 – 130221 
t otal approved options   5547413   5740542    
 
year of 
issue 
27 nov ember
2011
exercise 
price £
28 no vember 
2010
exercise 
price £ exercise period 
nonapproved 2001 21563  080  46563  080 210803 – 291111 
2001 10856  090  35856  090 301104 – 291111 
2002 31009  090  56787  090 310505 – 291112 
2002 175000  100  175000  100 070205 – 300512 
2002 350000  150  350000  150 070205 – 300512 
2003 100000  090  100000  090 301106 – 291113 
2005 754  100  754  100 301108 – 291115 
2005 787436  115  808236  115 160508 – 291115 
2007 50833  150  50833  150 310510 – 300517 
2009 267500  120  267500  120 310512 – 300519 
2009 24074  135  24074  135 161112 – 151119 
2011 37038  189  —  — 190714 – 180221 
t otal unapproved options 1856063 1915603
t otal   7403476   7656145    
notes to the consolidated financial statements  
notes to the consolidated financial statements continued 107 stock code ocdo wwwocadogroupcom
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notes to the consolidated financial statements
 
471 share options and other equity instruments continued
of the total employee share options above the following options were subject to performance criteria in relation to the 
average contribution by basket and ebitda
27 november 2011 28 november 2010
 
year of 
issue 
number of 
shar e options 
exercise 
price £ 
number of 
share options 
exercise 
price £ exercise period 
2005 170670  115  170670  115  310508 – 300515 
  2009 254000  120  254000  120  310512 – 300519 
t otal options subject to 
performance criteria 424670  424670   
details of the movement in the number of share options outstanding during each period are as follows
27 november 2011 28 november 2010
 
number of 
share 
options
weighted 
average 
exercise  
price £
number of 
share 
options
w eighted 
average 
exercise  
price £
outstanding at the beginning of the period 7656145  127  10593611  115 
granted during the period 1352275  236  1313929  165 
forfeited during the period  669807 172  2554974 112 
exercised during the period 935137 102  1696421 102 
outstanding at the end of the period 7403476  146  7656145  127 
exercisable at the end of the period 3092598  120  3662300  111 
since the company’s admission the market value of the company’s shares at each option grant date was taken to be 
the closing midmarket price of the shares on the day prior to issuance  prior to the admission the market value of the 
company’s shares was derived based on the market value of similar companies and by taking into account transactions with 
shareholders during the relevant period  the share valuation office of hmrc has confirmed in correspondence that in 
respect of options granted prior to admission the exercise price was not less that the market value of the company’s shares 
at each option grant date
the esos share options were exercised on a regular basis throughout the current and prior periods  for these exercises the 
weighted average share price at the date of exercise was £217 2010 £153
in determining the fair value of the share options granted during the period the blackscholes option pricing model was used 
with the following inputs
 
27 nov ember 
2011
28 no vember 
2010
w eighted average share price £236 £165
w eighted average exercise price £236 £165
expected volatility 025  025 
w eighted expected life — years 300  300 
riskfree interest rate 35 35
expected dividend yield 00 00
expected volatility was determined by comparing the company to others of a similar size or which operate in a similar 
industry  the expected life used in the model has been adjusted based on management’s best estimate for the effects of non
transferability exercise restrictions and behavioural considerations  all share awards under the esos are equitysettled 108
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
471 share options and other equity instruments continued
the weighted average remaining contractual lives for outstanding share options under the esos are as follows
27 november 2011 28 november 2010
exercise 
price £
number of 
share 
options
weighted 
average 
remaining 
contractual 
life years
exercise 
price £
number of 
share 
options
w eighted 
average 
remaining 
contractual 
life years
 080  281871  —  080  640288  10 
 090  439350  19  090  642047  30 
 100  430842  25  100  543543  38 
 115  854302  35  115  878406  45 
 120  886508  74  120  953805  84 
 135  1373413  79  135  1603773  89 
 140  86320  45  140  138890  55 
 150  901430  37  150  1103800  51 
 165  981348  86  165  1151593  96 
 189  362849  96  —  —  — 
 255  805243  92  —  —  — 
outstanding at the end of the period   7403476     7656145  
b jsos
the jsos is an executive incentive scheme which was introduced to incentivise and retain its executive directors and 
select members of senior management of the group the “p articipants”  it is a share ownership scheme under which the 
participants and appleby t rust jersey limited the ebt t rustee held at balance sheet date separate beneficial interests in 
36305099 2010 32476700 ordinary shares which represents 65 2010 59 of the issued share capital of the company
participants
a wards are granted to the executive board and a select group of senior management  in the prior period they acquired 
interests in 32476700 ordinary shares with an issue price of £150 per share in accordance with the group’s first jsos 
scheme “jsos1”  in the current period interests in a further 3990799 ordinary shares with an issue price of £170 were 
acquired by a select group of senior management excluding directors in accordance with the group’s second jsos scheme 
“jsos2”
nature of interests
interests take the form of a restricted interest in ordinary shares in the company the “interest”  an interest permits a 
participant to benefit from the increase if any in the value of a number of ordinary shares in the company “shares” over 
specified threshold amounts  in order to acquire an interest a participant must enter into a joint share ownership agreement 
with the ebt t rustee under which the participant and the ebt t rustee jointly acquire the shares and agree that when the 
shares are sold the participant has a right to receive a proportion of the sale proceeds insofar as the value of the shares 
exceeds the threshold amount  for the initial interests acquired by the p articipants there are four tranches each with their 
own threshold or hurdle price as follows
jsos1 jsos2
t ranche  v esting date  hurdle price 
  of
issue price  t ranche  v esting date  hurdle price 
  of
issue price 
1 2011 01012011 £173 115 1 2012 30062012 £196 115
2 2012 01012012 £191 127 2 2013 30062013 £215 127
3 2013 01012013 £208 139 3 2014 30062014 £236 139
4 2014 01012014 £228 152 4 2015 30062015 £259 152
for jsos1 p articipants were required to purchase their interest for 2 of the issue price  for jsos2 the price was in a 
range of 71 to 108  when an interest vests the ebt t rustee will transfer shares to the participant of equal value to the 
participant’s interest or the shares will be sold and the ebt t rustee will account to the participant for the balance ie the 
difference between the sale proceeds less expenses and the hurdle price
notes to the consolidated financial statements  
notes to the consolidated financial statements continued 109 stock code ocdo wwwocadogroupcom
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471 share options and other equity instruments continued
vesting conditions
the vesting of the interests granted to p articipants is subject to a time vesting condition with one quarter of the interest in 
the shares vesting on the first anniversary of their acquisition one quarter on the second anniversary one quarter on the third 
anniversary and the final quarter on the fourth anniversary
the fair value of the interests awarded under the jsos was determined using the blackscholes option pricing model  as per 
ifrs 2 “sharebased p ayment” market based vesting conditions and the share price target conditions in the jsos have been 
taken into account in establishing the fair value of the equity instruments granted  other nonmarket or performance related 
conditions were not taken into account in establishing the fair value of equity instruments granted instead these nonmarket 
vesting conditions are taken into account by adjusting the number of equity instruments included in the measurement of the 
transaction amount so that ultimately the amount recognised for services received as consideration for the equity instruments 
granted is based on the number of equity instruments that will eventually vest  
in determining the fair value of the interests granted the blackscholes option pricing model was used with the following 
inputs
jsos1 t ranche 1 t ranche 2 t ranche 3 t ranche 4
w eighted average share price £135 £135 £135 £135
w eighted average exercise price £173 £191 £208 £228
expected volatility 025 025 025 025
w eighted expected life — years 091 191 291 391
riskfree interest rate 35 35 35 35
expected dividend yield 00 00 00 00
jsos2 t ranche 1 t ranche 2 t ranche 3 t ranche 4
w eighted average share price £170 £170 £170 £170
w eighted average exercise price £196 £215 £236 £259
expected volatility 025 025 025 025
w eighted expected life — years 10 20 30 40
riskfree interest rate 35 35 35 35
expected dividend yield 00 00 00 00
expected volatility was determined by comparing the company to a basket of others of a similar size or which operate in a 
similar industry
c nonemployee share options
options to subscribe for ordinary shares and convertible preference shares have been granted by ocado limited to non
employees  these options are equitysettled and do not have any vesting criteria  as a result of the group’s restructuring in 
the prior period these options are now held over ordinary shares in ocado group plc
at each respective balance sheet date the outstanding options were as follows
27 november 2011 28 november 2010
date of issue 
number of 
shar e options 
exercise 
price £ 
number of 
share options
exercise 
price £ exercise period 
feb02 —  —  7400  090 040204 – 030214
feb02 886700  090  886700  090 040202 – 040217
jan04 435300  103  435300  103 030104 – 030118
outstanding at the end of the period 1322000   1329400    
notes to the consolidated financial statements
   110
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
471 share options and other equity instruments continued
details of the movement in the number of nonemployee share options outstanding during each period are as follows
27 november 2011 28 november 2010
 
number of 
share 
options
weighted 
average 
exercise 
price £
number of
share 
options
w eighted 
exercise 
average 
price £
outstanding at the beginning of the period 1329400  095  1471400  092 
granted during the period —  —  —  — 
forfeited during the period  —  —  —  — 
exercised during the period 7400 090  142000 070 
outstanding at the end of the period 1322000  095  1329400  095 
exercisable at the end of the period 1322000  095  1329400  095 
in the prior period the company documented an option to hawkeye capital p artners limited to subscribe for 38700 
ordinary shares at a price of £103 per share  these options were exercised on ipo at a weighted average price of £103
the weighted average remaining contractual lives for outstanding nonemployee share options are as follows
                                           27 november 2011 28 november 2010
exercise 
price £
number of 
share 
options
weighted 
average 
remaining 
contractual 
life years
exercise 
price £
number of
share
options
w eighted 
average 
remaining 
contractual 
life years
  090 886700  52 090  894100  62 
  103 435300  61 103  435300  79 
outstanding at the end of the period  1322000     1329400  
d sharesave scheme
in the prior period the group launched the ocado group sharesave scheme  this is an hmrc approved scheme and is open 
to any person that was an employee or officer of the group at the launch date  under the scheme members save a fixed 
amount each month for three years  at the end of the three year period they are entitled to use these savings to buy shares 
in the company at a price equal to 85 of the market value of the shares at the launch date
at 27 november 2011 employees of the company’s subsidiaries held 681 2010 819 contracts in respect of options over 
2314294 2010 2724513 shares  details of the movement in the number of sharesave options outstanding during each 
period are as follows
27 november 2011 28 november 2010
 
number of 
share 
options
weighted 
average 
exercise  
price £
number of
share 
options
w eighted 
average 
exercise  
price £
outstanding at the beginning of the period 2724513 1162  —  — 
granted during the period — — 2728850  1162 
forfeited during the period 409617 1162 4337 1162 
exercised during the period 602 1162 —  — 
outstanding at the end of the period 2314294 1162 2724513  1162 
exercisable at the end of the period — —  —  — 
notes to the consolidated financial statements  
notes to the consolidated financial statements continued 111 stock code ocdo wwwocadogroupcom
governance about oc ado our responsibilities
2106604 08022012 proof 1
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471 share options and other equity instruments continued
there were no sharesave options granted during the period  in determining the fair value of the share options granted during 
the prior period the blackscholes option pricing model was used with the following inputs
 
28 november
2010
w eighted average share price £137
w eighted average exercise price £116
expected volatility 025 
w eighted expected life — years 300 
riskfree interest rate 35
expected dividend yield 00
expected volatility was determined by comparing the company to others of a similar size or which operate in a similar 
industry
48 capital management
the boards objective is to maintain an appropriate balance of debt and equity financing to enable the group to continue as a 
going concern to sustain future development of the business and to maximise returns to shareholders and benefits to other 
stakeholders
the board closely manages trading capital defined as net assets plus net debt  net debt is calculated as total debt obligations 
under finance leases and borrowings as shown in the balance sheet less the shortterm investment and cash and cash 
equivalents  the group’s net assets at the end of the period were £1729 million 2010 £1718 million and it had net debt of 
£192 million 2010 net cash of £805 million  
the main areas of capital management revolve around working capital management and compliance with externally imposed 
financial covenants  throughout the period the group has complied with all covenants imposed by lenders
the components of working capital management include monitoring inventory turn age of inventory age of receivables 
receivables days payables days balance sheet reforecasting period projected loss weekly cash flow forecasts and daily cash 
balances  major investment decisions are based on reviewing the expected future cash flows and all major capital expenditure 
requires approval by the board  there were no changes in the group’s approach to capital management during the period
given the group’s commitment to expand the business and the investment required to complete cfc2 the declaration and 
payment of a dividend is not part of the shortterm capital management strategy of the group
at the balance sheet date the group’s undrawn facilities shortterm investment and cash and cash equivalents are as follows
  notes
27 nov ember 
2011
£’000
28 no vember 
2010
£’000
total facilities available  191488  191373 
facilities drawn down† 411 112643 74114
undrawn facilities at end of period 78845  117259 
shortterm investment —  30000 
cash and cash equivalents gross of drawn overdraft facility 344 92102  124780 
  170947  272039 
†  excluded from the amount of facilities drawn down is £14 million 2010 £nil relating to capitalised transaction costs
notes to the consolidated financial statements
   112
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
section 5 — other notes
51 subsidiaries
the principal subsidiary undertakings of the company are set out below  a schedule of interests in all undertakings is filed 
with the annual return
  principal activity 
 share of issued 
ordinary share capital 
and voting rights
 country of 
incorporation 
ocado holdings limited holding company 100 england and w ales 
ocado limited retail and distribution 100 england and w ales 
ocado information t echnology limited intellectual property 100 republic of ireland 
last mile developments limited property development 100 england and w ales 
ocado cell in atlas insurance pcc limited insurance company 100 malta 
in addition to the companies shown above the company also holds an investment in another subsidiary undertaking which 
in the directors’ opinion does not significantly affect the figures in the consolidated financial statements  in accordance with 
section 4102a of the companies act a full list of subsidiaries was annexed to the 2010 annual return and submitted to 
companies house  a full list of subsidiaries will be submitted to companies house with the 2011 annual return
the group has effective control over the financial and operating activities of the ocado cell and therefore consolidates the 
ocado cell in its financial statements in accordance with sic 12 “consolidation – special purpose entities”  the group uses 
the ocado cell to provide selfinsurance for its vehicle fleet and public and product liability claims
52 commitments
capital commitments
contracts placed for future capital expenditure but not provided for in the financial statements are as follows
27 nov ember 
2011
£’000
28 no vember 
2010
£’000
land and buildings 11501  21392 
property plant and equipment 88872  13661 
t otal capital expenditure committed at the end of the period 100373  35053 
£860 million of the total capital expenditure committed at the current period end relates to the construction of cfc2  the 
remainder relates to cfc1 upgrades it development and fleet expansion  the land and buildings commitment in the prior 
period relates to the purchase of land on which cfc2 is being built
operating lease commitments
the group leases a number of offices facilities and equipment under noncancellable operating leases   the leases have varying 
terms escalation clauses and renewal rights
at 27 november 2011 the ageing profile of future aggregate minimum lease payments under noncancellable operating leases 
are as follows
 
27 nov ember 
2011
£’000
28 no vember 
2010
£’000
due within one year 3379 2480 
due after one year but less than five years 9912  8434 
due after five years 36853  35024 
t otal future minimum lease payments 50144  45938 
notes to the consolidated financial statements  
notes to the consolidated financial statements continued 113 stock code ocdo wwwocadogroupcom
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our financials our performance
53 contingent liabilities
the group has contingent liabilities in respect of legal claims arising in the ordinary course of business all of which the group 
expects to be covered by its professional indemnity insurance  these legal claims are not material to these financial statements
54 related party transactions
key management personnel
only the executive and nonexecutive directors are deemed to be key management personnel  it is the board which has 
responsibility for planning directing and controlling the activities of the group  remuneration of directors is disclosed in the 
directors’ remuneration report on pages 46 to 55 
other related party transactions with key management personnel made during the period are as follows
 
52 w eeks 
ended 
27 nov ember 
2011
£’000
52 weeks 
ended 
28 no vember 
2010
£’000
purchase of goods
— company of a close family member of an executive director — 42 
purchase of professional services
— nonexecutive directors 9 30 
  9 72 
all transactions are on an arm’s length basis and no period end balances have arisen as a result of these transactions
at the end of the period key management did not owe the group any amounts 2010 £nil
there were no other material transactions or balances between the group and its key management personnel or members of 
their close family
notes to the consolidated financial statements
  114
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
54 related party transactions continued
investment
the group holds a 25 interest in p aneltex limited whose registered office is at p aneltex house somerden road hull hu9 
5pe  the group’s interest in p aneltex limited has not been treated as an associated undertaking as it does not have significant 
influence over paneltex limited  further information on the group’s relationship with p aneltex limited is provided in note 331
the following direct transactions were carried out with p aneltex limited
 
52 w eeks 
ended 
27 nov ember 
2011
£’000
52 weeks 
ended 
28 no vember 
2010
£’000
direct transactions
sale of goods
 — plant and machinery 34 94 
 — other 2 — 
36 94 
purchase of goods
 — plant and machinery 32 220 
 — consumables 167 143 
t otal purchase of goods 199 363
amounts payablereceivable at the end of the period 24 93
the following indirect transactions were carried out with p aneltex limited
 
52 w eeks 
ended 
27 nov ember 
2011
£’000
52 weeks 
ended 
28 no vember 
2010
£’000
indirect transactions
 — plant and machinery 3664 5590 
indirect transactions comprise the value of the group’s transactions with p aneltex limited which are included in amounts of 
finance obtained from some of the group’s finance lease counterparties
55 post balance sheet events
the group drew down a further £76 million and £97 million on the £100 million credit facility in december 2011 and 
february 2012 respectively
in january 2012 an order was placed with mercedesbenz for 50 delivery vans
on 31 january 2012 the group opened a new spoke in oxfordshire which will increase the delivery capacity in the thames 
corridor and in south midlands
notes to the consolidated financial statements  
notes to the consolidated financial statements continued 115 stock code ocdo wwwocadogroupcom
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our financials our performance
independent auditors report
  
independent auditors’ report 
to the members of ocado group plc
w e have audited the parent company financial statements 
of ocado group plc for the year ended 27 november 2011 
which comprise the company balance sheet the company 
statement of cash flows the company statement of changes 
in equity and the related notes  the financial reporting 
framework that has been applied in their preparation is 
applicable law and international financial reporting standards 
ifrss as adopted by the european union and as applied in 
accordance with the provisions of the companies act
respective responsibilities of directors        
and auditors 
as explained more fully in the directors’ responsibilities 
statement set out on pages 64 and 65 the directors are 
responsible for the preparation of the parent company 
financial statements and for being satisfied that they give a 
true and fair view  our responsibility is to audit and express 
an opinion on the parent company financial statements in 
accordance with applicable law and international standards 
on auditing uk and ireland  those standards require us to 
comply with the auditing practices board’s ethical standards 
for auditors 
this report including the opinions has been prepared for and 
only for the company’s members as a body in accordance 
with chapter 3 of part 16 of the companies act and for no 
other purpose  w e do not in giving these opinions accept or 
assume responsibility for any other purpose or to any other 
person to whom this report is shown or into whose hands it 
may come save where expressly agreed by our prior consent 
in writing
scope of the audit of the financial statements 
an audit involves obtaining evidence about the amounts 
and disclosures in the financial statements sufficient to 
give reasonable assurance that the financial statements 
are free from material misstatement whether caused by 
fraud or error  this includes an assessment of whether 
the accounting policies are appropriate to the parent 
company’s circumstances and have been consistently applied 
and adequately disclosed the reasonableness of significant 
accounting estimates made by the directors and the overall 
presentation of the financial statements  in addition we read 
all the financial and nonfinancial information in the annual 
report to identify material inconsistencies with the audited 
financial statements  if we become aware of any apparent 
material misstatements or inconsistencies we consider the 
implications for our report
opinion on financial statements 
in our opinion the parent company financial statements 
 z give a true and fair view of the state of the company’s 
affairs as at 27 november 2011 and of its cash flows for 
the year then ended 
 z have been properly prepared in accordance with ifrss 
as adopted by the european union and as applied in 
accordance with the provisions of the companies act 
and 
 z have been prepared in accordance with the requirements 
of the companies act
opinion on other matters prescribed by the 
companies act 
in our opinion
 z the part of the directors’ remuneration report to be 
audited has been properly prepared in accordance with 
the companies act and
 z the information given in the directors’ report for the 
financial year for which the parent company financial 
statements are prepared is consistent with the parent 
company financial statements
matters on which we are required to report  
by exception 
w e have nothing to report in respect of the following 
matters where the companies act requires us to report to 
you if in our opinion
 z adequate accounting records have not been kept by the 
parent company or returns adequate for our audit have 
not been received from branches not visited by us or 
 z the parent company financial statements and the part 
of the directors’ remuneration report to be audited 
are not in agreement with the accounting records and 
returns or 
 z certain disclosures of directors’ remuneration specified 
by law are not made or 
 z we have not received all the information and 
explanations we require for our audit
other matter 
w e have reported separately on the group financial 
statements of ocado group plc for the year ended 
27 november 2011
clive hinds senior statutory auditor
for and on behalf of pricewaterhousecoopers llp
chartered accountants and statutory auditors
st albans
21 march 2012 116
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
company balance sheet
as at 27 november 2011
  notes
27 nov ember 
2011
£’000
28 no vember 
2010
£’000
noncurrent assets
investments 311 478436  477840 
    478436  477840 
current assets
other receivables 321 137952  61250 
shortterm investment 322 —  30000 
cash and cash equivalents 323 85330  114361 
    223282  205611 
t otal assets   701718  683451 
current liabilities
t rade and other payables 324 9543 323
 9543 323
net current assets   213739  205288 
net assets   692175  683128 
equity
share capital 411 11167  11068 
share premium 411 213746  206094 
retained earnings 467262  465966 
t otal equity   692175  683128 
the company financial statements on pages 116 to 136 were authorised for issue by the board of directors and signed on its 
behalf by
tim steiner 
chief executive officer 
andrew bracey 
chief financial officer
ocado group plc 
company registration number 07098618 england and w ales
21 march 2012
company balance sheet   117 stock code ocdo wwwocadogroupcom
governance about oc ado our responsibilities
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our financials our performance
company statement of cash flows
  
company statement of cash flows
for the 52 weeks ended 27 november 2011
 
  notes
52 weeks 
ended 
 27 nov ember 
2011
£’000
51 weeks 
ended 
28 no vember 
2010
£’000
cash flow from operating activities
profitloss before income tax 700  2084
adjustments for
— finance income 1105 1529
— finance costs —  5 
changes in working capital
— movement in other receivables 79186 61250
— movement in trade and other payables 9219  323
net cash outflow from operations 70372 64535
interest paid on behalf of group undertakings 106 156
net cash outflow from operating activities   70478 64691
cash flow from investing activities
interest received 917  553 
decreaseincrease in shortterm investment 30000  30000
net cash from investing activities   30917  29447
cash flow from financing activities
proceeds from issue of ordinary share capital net of transaction costs 967  208499
proceeds from borrowings received on behalf of group undertakings 9563 —
net cash from financing activities   10530  208499 
net decreaseincrease in cash and cash equivalents 29031 114361 
cash and cash equivalents at beginning of period 114361  — 
cash and cash equivalents at end of period 323 85330  114361  118
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
company statement of changes in equity 
 
company statement of changes in equity
for the 52 weeks ended 27 november 2011
 
  notes
share 
capital
£’000
share 
premium
£’000
retained  
earnings
£’000
total 
equity
£’000
balance at 8 december 2009   —  —  —  — 
loss for the period —  —  2084 2084
t otal comprehensive expense for the period   —  —  2084 2084
t ransactions with owners
— issue of ordinary and convertible preference shares 411 476509  —  —  476509 
— capital reduction 411 467846 —  467846  — 
— issue of ordinary shares on ipo 411 2380  211862  —  214242 
— ordinary shares issue costs 411 —  6881 —  6881
— issue of ordinary shares 25  1113  —  1138 
— sharebased payments charge   —  —  204  204 
t otal transactions with owners 11068  206094  468050  685212 
balance at 28 november 2010   11068  206094  465966  683128 
profit for the period —  —  700  700 
t otal comprehensive income for the period   —  —  700  700 
t ransactions with owners
— issue of ordinary shares 411 99  7652  —  7751 
— sharebased payments charge   —  —  596  596 
t otal transactions with owners 99  7652  596  8347 
balance at 27 november 2011   11167  213746  467262  692175  119 stock code ocdo wwwocadogroupcom
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our financials our performance
notes to the company financial statements
 
notes to the company financial statements
section 1 — basis of preparation
general information
ocado group plc is incorporated and domiciled in the 
united kingdom  the address of its registered office is titan 
court 3 bishops square hatfield business p ark hatfield 
hertfordshire al10 9ne  the financial period represents the 
52 weeks ended 27 november 2011 prior period 51 weeks 
ended 28 november 2010
basis of preparation
the financial statements have been prepared in accordance 
with international financial reporting standards ifrs’s and 
international financial reporting interpretation committee 
ifrs ic interpretations as endorsed by the european union 
“ifrseu” and those parts of the companies act applicable 
to companies reporting under ifrs
the financial statements are presented in sterling rounded to 
the nearest thousand £’000 unless otherwise stated   they 
have been prepared under the historical cost convention 
except for financial instruments that have been measured at 
fair value through profit and loss
the financial statements have been prepared on the going 
concern basis which assumes that the company will continue 
to be able to meet its liabilities as they fall due for the 
foreseeable future
exemptions
the directors have taken advantage of the exemption 
available under section 408 of the companies act and 
not presented an income statement or a statement of 
comprehensive income for the company alone  the profit 
for the period is £700000 2010 loss of £2084000
standards amendments and interpretations 
adopted by the company in 201011 or issued 
but are not yet effective and have not been 
early adopted by the company
the company has considered the following new standards 
interpretations and amendments to published standards that 
are effective for the company for the financial year beginning 
29 november 2010 and concluded that they are either not 
relevant to the company or that they would not have a 
significant impact on the company’s financial statements
 z ifric 15 “arrangements for the construction of real 
estate”  this ifric was effective 1 january 2009 but eu 
endorsed for 1 january 2010
 z ifric 19 “extinguishing financial liabilities with equity 
instruments”
 z amendments to various ifrss and iass arising from the 
iasb’s annual improvements project in 2009
the following new standards interpretations and amendments 
to published standards and interpretations which are relevant 
to the group have been issued but are not effective for the 
financial year beginning 29 november 2010 and have not been 
adopted early
 z ifrs 9 “financial instruments”
 z ifrs 10 “consolidated financial statements”
 z ifrs 11 “joint arrangements”
 z ifrs 12 “disclosure of interests in other entities”
 z ifrs 13 “fair value measurement”
 z ias 24 revised “related p arty disclosures”
 z ias 27 revised 2011 “separate financial statements”
 z ias 28 revised 2011 “investments in associates and 
joint v entures”
 z amendments to various ifrss and iass arising from the 
iasb’s annual improvements project
 not yet endorsed by the eu 
accounting policies
foreign currency translation
transactions and balances
foreign currency transactions are translated into the functional 
currency using the exchange rates prevailing at the dates of the 
transactions or valuation where items are remeasured  foreign 
exchange gains or losses resulting from the settlement of such 
transactions and from the translation at year end exchange 
rates of monetary assets and liabilities denominated in foreign 
currencies are recognised in the income statement 
taxation
the tax credit for the period comprises current and deferred 
tax  t ax is recognised in the income statement except 
to the extent that it relates to items recognised in other 
comprehensive income or directly in equity  in this case the 
tax is also recognised in other comprehensive income or 
directly in equity respectively
current tax is the expected tax payable on the taxable income 
for the period using tax rates enacted or substantively enacted 
by the balance sheet date  management periodically evaluates 
positions taken in tax returns with respect to situations in 
which applicable tax regulation is subject to interpretation  
it establishes provisions where appropriate on the basis of 
amounts expected to be paid to the tax authorities
critical accounting estimates and assumptions
the preparation of financial statements in conformity with 
ifrseu requires the use of certain critical accounting estimates  
it also requires management to exercise its judgement in the 
process of applying the company’s accounting policies
estimates and judgments are continually evaluated and are 
based on historical experience and other factors including 
expectations of future events that are believed to be 
reasonable under the circumstances
the company makes estimates and assumptions concerning 
the future  the resulting accounting estimates will by 
definition seldom equal the related actual results  the 
critical accounting estimates or judgements relevant to the 
consolidated financial statements are embedded with the 
relevant notes to the consolidated financial statements 120
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
notes to the company financial statements  
section 2 — results for the year
21 profit before tax
accounting policies
administrative expenses
administrative expenses consist of fees for professional services bank charges and any other costs of an administrative nature
211 operating loss
during the period the company obtained the following services from its auditors
 
 
52 weeks 
ended 
 27 nov ember 
2011
£’000
51 weeks 
ended 
28 no vember 
2010
£’000
audit services
— statutory company audit 47  40 
nonaudit services
— services pursuant to legislation and compliance† —  975 
— other services —  108 
 47  1123 
†  comprises primarily services in relation to the preparation for the listing of the company
212 employee information
the company does not incur any direct staff costs as the group’s employees are employed by a subsidiary company 
analysis and disclosures in relation to sharebased payments are given in note 42
notes to the company financial statements continued 121 stock code ocdo wwwocadogroupcom
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2106604 08022012 proof 1
our financials our performance
notes to the company financial statements
 
section 3 — operating assets and liabilities
31 investments
accounting policies
availableforsale financial assets
a vailableforsale financial assets are nonderivatives that are 
either designated in this category or not classified in any of 
the other categories  they are included in noncurrent assets 
unless the investment matures or management intends to 
dispose of it within 12 months of the end of the reporting 
period  management considers that the group’s investments 
fall within this category as explained below
investments
investments are classified as either held for trading or 
availableforsale  there are currently no investments classified 
as held for trading
a vailableforsale investments are held at fair value if this 
can be reliably measured  if the equity instruments are not 
quoted in an active market and their fair value cannot be 
reliably measured the availableforsale investment is carried 
at cost less accumulated impairment  unless the valuation 
falls below its original cost gains and losses arising from 
changes in fair value of availableforsale assets are recognised 
directly in equity  on disposal the cumulative net gain or loss 
is transferred to the statement of comprehensive income  
valuations below cost are recognised as impairment losses 
in the income statement  dividends are recognised in the 
income statement when the right to receive payment is 
established
investments in group undertakings are therefore valued at 
cost less accumulated impairment
311 investments
 
 
27 nov ember 
2011
£’000
28 no vember 
2010
£’000
cost 476510  476510 
contributions to subsidiaries
— novation of derivative liability in respect of warrants issued by ocado limited 1126  1126 
— group equity settled sharebased payments 800  204 
carrying value at end of period 478436  477840 
investments represent investments in group companies ocado holdings limited and ocado limited which is indirectly held 
for more information regarding the company’s investments see note 51 122
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
notes to the company financial statements  
32 w orking capital
accounting policies
loans and receivables
loans and receivables are nonderivative financial assets with 
fixed or determinable payments that are not quoted in an 
active market  they are included in current assets except 
for maturities greater than 12 months after the end of the 
reporting period  these are classified as noncurrent assets  
the company’s loans and receivables comprise “other 
receivables” “shortterm investment” and “cash and cash 
equivalents” in the balance sheet
other receivables
other receivables are noninterest bearing and are 
recognised initially at fair value and subsequently at amortised 
cost reduced by appropriate allowances for estimated 
irrecoverable amounts
shortterm investments
shortterm investments comprise treasury deposits with a 
maturity of greater than three months at the balance sheet 
date
cash and cash equivalents
cash and cash equivalents comprise cash at bank and in hand 
demand deposits with banks and shortterm deposits with a 
maturity of three months or less at the balance sheet date
financial liabilities
financial liabilities are classified according to the substance of 
the contractual arrangements entered into
trade and other payables
t rade and other payables are initially recognised at fair value 
and subsequently at amortised cost using the effective 
interest rate method
321 other receivables
 
  
 
27 nov ember 
2011
£’000
28 no vember 
2010
£’000
other receivables 50  174 
prepayments —  6 
accrued income 214  402 
amounts due from subsidiary undertakings 137688  60668 
  137952  61250 
no security has been granted over other receivables
322 shortterm investment
the shortterm investment relates to a £30 million treasury deposit which matured on 26 july 2011
323 cash and cash equivalents
 
 
27 nov ember 
2011
£’000
28 no vember 
2010
£’000
cash at bank and in hand 85330  114361 
the prior period cash and cash equivalents balance does not include a £30 million treasury deposit held by the company 
which was classified as a shortterm investment see note 322
notes to the company financial statements continued 123 stock code ocdo wwwocadogroupcom
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2106604 08022012 proof 1
our financials our performance
notes to the company financial statements
  
324 trade and other payables
 
 
27 nov ember 
2011
£’000
28 no vember 
2010
£’000
t rade payables 321  98 
other payables 58  —
accruals 3  225 
amounts due to subsidiary undertakings 9161  — 
  9543  323  124
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
notes to the company financial statements  
section 4 — capital structure and financing
41 share capital and premium
accounting policies
equity instruments issued by the group are recorded at the proceeds received net of direct issue costs
411 share capital and premium
the company has authorised share capital of 600 million ordinary shares of 2 pence each at 27 november 2011
at 27 november 2011 the number of ordinary shares available for issue under the block listing facility were 4352024 2010 
5276413  these ordinary shares will only become allotted when share options under the group’s esos and nonemployee 
share options have been exercised and are therefore not included in the total number of ordinary shares outstanding above
the movements in the number of allotted called up and fully paid ordinary and convertible preference shares and called up 
share capital and share premium are set out below
  notes
ordinary 
shares
number of 
shares
convertible 
preference 
shares
number of 
shares
ordinary 
shares
£’000
convertible 
preference 
shares
£’000
share 
premium
£’000
as at 8 december 2009 —  —  —  —  — 
issue of ordinary and convertible 
preference shares 185715900  247474900  204287  272222  — 
capital reduction —  —  200573 267273 — 
conversion of preference shares to 
ordinary shares on ipo 247474900  247474900 4949  4949 — 
issue of ordinary shares on ipo 118968225  —  2379    211763 
issue of ordinary shares to the 
chairman on ipo 55555  —  1  —  99 
share issue costs —  —  — —  6881
allotted in respect of the executive 
share option scheme 1032921  —  21  —  978 
allotted in respect of non
employee share options 421c 180700  —  4  —  135 
as at 28 november 2010   553428201  —  11068  —  206094 
allotted in respect of the executive 
share option scheme 421a 935137  —  19 —  940 
allotted in respect of the joint 
share ownership scheme 421b 3990799  —  80 —  6704 
allotted in respect of the 
sharesave scheme                        421d 602  —  —  —  1 
allotted in respect of non
employee share options 421c 7400  —  —  —  7 
as at 27 november 2011   558362139  —  11167  —  213746 
convertible preference shares were convertible into the same number of ordinary shares either at the option of the holder 
or on the occurrence of certain trigger events including a public listing the convertible preference shares ranked pari passu 
with ordinary shares with the exception that on return of assets on a liquidation reduction of capital or otherwise the holders 
of the convertible preference shares shall be entitled in respect of their preference shares in proportion to the number 
of such shares held by each of them in priority to all other shareholders to the surplus assets of the company remaining 
after payment of its liabilities the subscription price for their preference shares together with a sum equal to any arrears of 
dividends declared calculated down to the date of the return of assets
notes to the company financial statements continued 125 stock code ocdo wwwocadogroupcom
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2106604 08022012 proof 1
our financials our performance
notes to the company financial statements
 
41 share capital and premium continued
on 9 february 2010 the company acquired the entire share 
capital of ocado limited  as a result of this transaction 
the shareholders in ocado limited received shares in the 
company in direct proportion to their original shareholdings 
in ocado limited  shareholders were issued 100 shares in the 
company for every 1 share held in ocado limited   the shares 
in the company have a nominal value of 2 pence each
on 16 february 2010 pursuant to an order of the court 
confirming the reduction of capital of the company the 
company’s share capital was reduced by decreasing the 
nominal value of each ordinary and preference share issued 
pursuant to the scheme of arrangement from 110 pence to   
2 pence  this created distributable reserves of £4678 million
on 26 july 2010 the company’s shares were admitted to the 
premium listing segment of the official list of the uk listing 
authority and to trading on the main market of the london 
stock exchange the “listing”  in conjunction the company 
made an initial public offering “ipo” of 118968225 new      
2 pence ordinary shares at a price of 180 pence per ordinary 
share  also in conjunction 247474900 convertible preference 
shares converted to ordinary shares 
also in the prior period costs relating directly to the new 
issue of shares to the amount of £69 million were deducted 
from the share premium account  attributable ipo costs were 
allocated between the share premium account and profit 
and loss account in proportion to the number of primary 
and secondary shares traded on admission  other costs 
attributable to the listing were expensed
42 sharebased payments
accounting policies
employee benefits
employees including directors of the company’s 
subsidiaries receive remuneration in the form of sharebased 
payments whereby employees render services in exchange 
for rights over shares “equitysettled transactions”  the cost 
of equitysettled transactions with employees is measured 
by reference to the fair value at the date on which they are 
granted  fair value is measured by use of the blackscholes 
option pricing model  the expected life used in the model 
has been adjusted based on management’s best estimate 
for the effects of nontransferability exercise restrictions 
and behavioural considerations  in valuing equitysettled 
transactions no account is taken of any performance 
conditions
the cost of equitysettled transactions is recognised together 
with a corresponding increase in equity over the years in 
which the performance conditions are fulfilled ending on the 
date on which the relevant employees become fully entitled 
to the award “vesting date”  subsidiaries are recharged for 
the amount recognised as sharebased payments relating to 
awards to their employees  these recharges are recognised 
as an increase in the investment in relevant subsidiaries in 
accordance with ifrs 2
421 share options and other equity 
instruments
the group currently operates three employee share 
incentive schemes namely the executive share ownership 
scheme the “esos” the joint share ownership scheme the 
“jsos” and the sharesave scheme
a esos
the group’s esos is an equitysettled share option scheme 
approved by hmrc  options may also be granted under 
the terms of a schedule which is not so approved  the esos 
was established by ocado in 2001
under the esos ocado or the trustees of an employee trust 
may grant options over shares in the company to eligible 
employees  the eligible employees to whom options are 
granted and the terms of such options will be determined 
by the directors of ocado or the trustees  the employees 
who are eligible to participate in the esos are all ocado’s 
executive directors and employees including the employees 
of the company’s subsidiaries  options are not transferable
the exercise price of options may not be less than the 
market value of the company’s shares on the date of grant  
if the trustees or the directors have determined that the 
exercise of an option will be satisfied by the issue of ordinary 
shares the exercise price may also not be less than the 
nominal value of ordinary shares 126
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
notes to the company financial statements   421 share options and other equity instruments continued
the directors of ocado or the trustees may impose a performance target and any further condition determined to be 
appropriate on the exercise of an option  any performance target must generally be measured over a period of at least three 
years  there are currently no options granted which are subject to performance targets that have not yet been met
the vesting period for the esos is three years  if the options remain unexercised after a period of ten years from the date of 
grant or the employee leaves the group the options expire subject to a limited number of exceptions
on 9 february 2010 the ordinary shares and convertible preference shares in ocado limited were converted into ordinary 
shares and convertible preference shares in the company on a 1100 basis with a nominal value of 2 pence per ordinary share  
the prior period opening balance and movements during the prior period have been disclosed as if the conversion occurred 
at the beginning of that period
at each respective balance sheet date the outstanding options were as follows
 
year of 
issue 
27 nov ember 
2011
exercise 
price £ 
28 no vember 
2010
exercise 
price £ exercise period 
approved 2001 260308  080  593725  080 210803 – 291111 
2001 17744  090  17744  090 301104 – 291111 
2002 59162  090  128181  090 310505 – 291112 
2003 97194  090  120053  090 310506 – 291113 
2004 123385  090  183426  090 310507 – 291114 
2005 255088  100  367789  100 310508 – 291115 
2005 66866  115  70170  115 310508 – 300515 
2006 86320  140  138890  140 310509 – 300516 
2006 86327  150  115028  150 301109 – 291116 
2007 414270  150  587939  150 310510 – 291117 
2008 166816  135  225578  135 301111 – 291118 
2008 393212  120  445751  120 310511 – 300518 
2009 225796  120  240554  120 310512 – 300519 
2009 1182523  135  1354121  135 021112 – 291119 
2010 981348  165  1151593  165 300613 – 290620 
2011 325811  189  —  — 190714 – 180721 
  2011 805243  255  —  — 140214 – 130221 
t otal approved options   5547413   5740542    
 
year of 
issue 
27 nov ember 
2011
exercise 
price £
28 no vember 
2010
exercise 
price £ exercise period 
nonapproved 2001 21563  080  46563  080 210803 – 291111 
2001 10856  090  35856  090 301104 – 291111 
2002 31009  090  56787  090 310505 – 291112 
2002 175000  100  175000  100 070205 – 300512 
2002 350000  150  350000  150 070205 – 300512 
2003 100000  090  100000  090 301106 – 291113 
2005 754  100  754  100 301108 – 291115 
2005 787436  115  808236  115 160508 – 291115 
2007 50833  150  50833  150 310510 – 300517 
2009 267500  120  267500  120 310512 – 300519 
2009 24074  135  24074  135 161112 – 151119 
2011 37038  189  —  — 190714 – 180221 
t otal unapproved options 1856063   1915603    
t otal   7403476   7656145    
notes to the company financial statements continued 127 stock code ocdo wwwocadogroupcom
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2106604 08022012 proof 1
our financials our performance
notes to the company financial statements
  
421 share options and other equity instruments continued
of the total employee share options above the following options were subject to performance criteria in relation to the 
average contribution by basket and ebitda
27 november 2011 28 november 2010
 
year of 
issue 
number of 
shar e options 
exercise 
price £ 
number of 
share options 
exercise 
price £ exercise period 
2005 170670  115  170670  115  310508 – 300515 
  2009 254000  120  254000  120  310512 – 300519 
t otal options subject to  
performance criteria 424670   424670    
details of the movement in the number of share options outstanding during each financial period are as follows
27 november 2011 28 november 2010
 
number of 
share options
weighted 
average 
exercise  
price £
number of 
share options
w eighted 
average 
exercise  
price £
outstanding at the beginning of the period 7656145  127  10593611  115 
granted during the period 1352275  236  1313929  165 
forfeited during the period  669807 172  2554974 112 
exercised during the period 935137 102  1696421 102 
outstanding at the end of the period 7403476  146  7656145  127 
exercisable at the end of the period 3092598  120  3662300  111 
since the company’s admission the market value of the company’s shares at each option grant date was taken to be 
the closing midmarket price of the shares on the day prior to issuance  prior to the admission the market value of the 
company’s shares was derived based on the market value of similar companies and by taking into account transactions with 
shareholders during the relevant period  the share valuation office of the inland revenue has confirmed in correspondence 
that in respect of options granted prior to admission the exercise price was not less that the market value of the company’s 
shares at each option grant date
the esos share options were exercised on a regular basis throughout the current and prior periods  for these exercises the 
weighted average share price at the date of exercise was £217 2010 £153
in determining the fair value of the share options granted during the period the blackscholes option pricing model was used 
with the following inputs
 
27 nov ember 
2011
28 no vember 
2010
w eighted average share price £236 £165
w eighted average exercise price £236 £165
expected volatility 025  025 
w eighted expected life — years 300  300 
riskfree interest rate 35 35
expected dividend yield 00 00
expected volatility was determined by comparing the company to others of a similar size or which operate in a similar 
industry  the expected life used in the model has been adjusted based on management’s best estimate for the effects of non
transferability exercise restrictions and behavioural considerations  all share awards under the esos are equitysettled 128
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
notes to the company financial statements   421 share options and other equity instruments continued
the weighted average remaining contractual lives for outstanding share options under the esos are as follows
27 november 2011 28 november 2010
exercise
price £
number of 
share 
options
weighted 
average 
remaining 
contractual 
life years
exercise 
price £
number of 
share 
options
w eighted 
average 
remaining 
contractual 
life years
 080  281871  —  080  640288  10 
 090  439350  19  090  642047  30 
 100  430842  25  100  543543  38 
 115  854302  35  115  878406  45 
 120  886508  74  120  953805  84 
 135  1373413  79  135  1603773  89 
 140  86320  45  140  138890  55 
 150  901430  37  150  1103800  51 
 165  981348  86  165  1151593  96 
 189  362849  96  —  —  — 
 255  805243  92  —  —  — 
outstanding and the end of the period 7403476     7656145  
b jsos
the jsos is an executive incentive scheme which was introduced to incentivise and retain its executive directors and 
select members of senior management of the group the “p articipants”  it is a share ownership scheme under which the 
participants and appleby t rust jersey limited the ebt t rustee held at balance sheet date separate beneficial interests in 
36305099 2010 32476700 ordinary shares which represents 65 2010 59 of the issued share capital of the company
participants
a wards are granted to the executive board and a select group of senior management  in the prior period they acquired 
interests in 32476700 ordinary shares with an issue price of £150 per share in accordance with the group’s first jsos 
scheme “jsos1”  in the current period interests in a further 3990799 ordinary shares with an issue price of £170 were 
acquired by a select group of senior management excluding directors in accordance with the group’s second jsos scheme 
“jsos2”
nature of interests
interests take the form of a restricted interest in ordinary shares in the company the “interest”  an interest permits a 
participant to benefit from the increase if any in the value of a number of ordinary shares in the company “shares” over 
specified threshold amounts  in order to acquire an interest a participant must enter into a joint share ownership agreement 
with the ebt t rustee under which the participant and the ebt t rustee jointly acquire the shares and agree that when the 
shares are sold the participant has a right to receive a proportion of the sale proceeds insofar as the value of the shares 
exceeds the threshold amount  for the initial interests acquired by the p articipants there are four tranches each with their 
own threshold or hurdle value as follows
jsos1 jsos2
t ranche  v esting date  hurdle value 
  of issue 
price  t ranche vesting date hurdle value 
  of issue 
price 
1 2011 01012011 £173 115 1 2012 30062012 £196 115
2 2012 01012012 £191 127 2 2013 30062013 £215 127
3 2013 01012013 £208 139 3 2014 30062014 £236 139
4 2014 01012014 £228 152 4 2015 30062015 £259 152
for jsos1 p articipants were required to purchase their interest for 2 of the issue price  for jsos2 this price was in a 
range of 71 to 108  when an interest vests the ebt t rustee will transfer shares to the participant of equal value to the 
participant’s interest or the shares will be sold and the ebt t rustee will account to the participant for the balance ie the 
difference between the sale proceeds less expenses and the hurdle value
notes to the company financial statements continued 129 stock code ocdo wwwocadogroupcom
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notes to the company financial statements 
 
421 share options and other equity instruments continued
vesting conditions
the vesting of the interests granted to p articipants are subject to a time vesting condition with one quarter of the interest in 
the shares vesting on the first anniversary of their acquisition one quarter on the second anniversary one quarter on the third 
anniversary and the final quarter on the fourth anniversary
the fair value of the interests awarded under the jsos was determined using the blackscholes option pricing model  as per 
ifrs 2 “sharebased p ayments” market based vesting conditions and the share price target conditions in the jsos have been 
taken into account in establishing the fair value of the equity instruments granted  other nonmarket or performance related 
conditions were not taken into account in establishing the fair value of equity instruments granted instead these nonmarket 
vesting conditions are taken into account by adjusting the number of equity instruments included in the measurement of the 
transaction amount so that ultimately the amount recognised for services received as consideration for the equity instruments 
granted is based on the number of equity instruments that will eventually vest  
in determining the fair value of the interests granted the blackscholes option pricing model was used with the following 
inputs
jsos1 t ranche 1 t ranche 2 t ranche 3 t ranche 4
w eighted average share price £135 £135 £135 £135
w eighted average exercise price £173 £190 £208 £228
expected volatility 025 025 025 025
w eighted expected life — years 091 191 291 391
riskfree interest rate 35 35 35 35
expected dividend yield 00 00 00 00
jsos2 t ranche 1 t ranche 2 t ranche 3 t ranche 4
w eighted average share price £170 £170 £170 £170
w eighted average exercise price £196 £215 £236 £259
expected volatility 025 025 025 025
w eighted expected life — years 10 20 30 40
riskfree interest rate 35 35 35 35
expected dividend yield 00 00 00 00
expected volatility was determined by comparing the company to others of a similar size or which operate in a similar 
industry
c nonemployee share options
options to subscribe for ordinary shares and convertible preference shares have been granted by ocado limited to non
employees  these options are equitysettled and do not have any vesting criteria  as a result of the group’s restructuring in 
the prior period these options are now held over ordinary shares in the company
at each respective balance sheet date the options granted to nonemployees at the date of their grant were as follows
27 november 2011 28 november 2010
date of issue 
number of 
shar e options 
exercise 
price £ 
number of 
share options
exercise 
price £ exercise period 
feb02 — —  7400  090 040204 – 030214
feb02 886700  090  886700  090 040202 – 040217
jan04 435300  103  435300  103 030104 – 030118
outstanding at the end of the period 1322000   1329400     130
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
notes to the company financial statements   421 share options and other equity instruments continued
27 november 2011 28 november 2010
 
number of 
share 
options
weighted 
average 
exercise 
price £
number of 
share 
options
w eighted 
average 
exercise 
price £
outstanding at the beginning of the period 1329400  095  1471400  092 
granted during the period —  —  —  — 
forfeited during the period  —  — —  — 
exercised during the period 7400 090  142000 070 
outstanding at the end of the period 1322000  095  1329400  095 
exercisable at the end of the period 1322000  095  1329400  095 
in the prior period the company documented an option to hawkeye capital p artners limited to subscribe for 38700 
ordinary shares at a price of £103 per share  these options were exercised on ipo at a weighted average price of £103
the weighted average remaining contractual lives for outstanding nonemployee share options are as follows
27 november 2011 28 november 2010
exercise 
price £
number of 
share 
options
weighted 
average 
remaining 
contractual 
life years
exercise 
price £
number of 
share 
options
w eighted 
average 
remaining 
contractual 
life years
 090  886700  52  090  894100  62 
 103  435300  61  103  435300  79 
outstanding at the end of the period   1322000     1329400  
d sharesave scheme
in the prior period the group launched the ocado group sharesave scheme  this is an hmrc approved scheme and is open 
to any person that was an employee or officer of the group at the launch date  under the scheme members save a fixed 
amount each month for three years  at the end of the three year period they are entitled to use these savings to buy shares 
in the company at a price equal to 85 of the market value of the shares at the launch date
at 27 november 2011 employees of the company’s subsidiaries held 681 2010 819 contracts in respect of options over 
2314294 2010 2724513 shares  details of the movement in the number of sharesave options outstanding during each 
period are as follows
27 november 2011
 
28 november 2010
 
number of 
share options
weighted 
average 
exercise  
price £
number of 
share options
w eighted 
average 
exercise  
price £
outstanding at the beginning of the period 2724513 1162  —  — 
granted during the period — — 2728850  1162 
forfeited during the period 409617 1162 4337 1162 
exercised during the period 602 1162 —  — 
outstanding at the end of the period 2314294 1162 2724513  1162 
exercisable at the end of the period — —  —  — 
notes to the company financial statements continued 131 stock code ocdo wwwocadogroupcom
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our financials our performance
notes to the company financial statements
  
421 share options and other equity instruments continued
there were no sharesave options granted during the period  in determining the fair value of the share options granted during 
the prior period the blackscholes option pricing model was used with the following inputs
 
28 no vember 
2010
w eighted average share price £137
w eighted average exercise price £116
expected volatility 025 
w eighted expected life — years 300 
riskfree interest rate 35
expected dividend yield 00
expected volatility was determined by comparing the company to others of a similar size or which operate in a similar industry
43 financial instruments
accounting policies
financial assets and financial liabilities are recognised on the balance sheet when the company becomes a party to the 
contractual provisions of the instrument  the company classifies its financial instruments into availableforsale loans and 
receivables and other financial liabilities at amortised cost
the classification depends on the purpose for which the financial assets and liabilities were acquired  management determines 
the classification of its financial instruments at initial recognition or in certain circumstances on modification
offsetting financial instruments
financial assets and liabilities are offset and the net amount reported in the balance sheet when there is a legally enforceable 
right to offset the recognised amounts and there is an intention to settle on a net basis or realise the asset and settle the 
liability simultaneously
431 fair value of financial instruments
set out below is a comparison by category of carrying values and fair values of all financial instruments that are carried in the 
financial statements  the fair values of financial assets and liabilities are based on prices available from the market on which the 
instruments are traded where available  the fair values of cash and cash equivalents the shortterm investment receivables 
and payables are assumed to approximate to their carrying values but for completeness are included in the analysis below
27 november 2011 28 november 2010
  notes
carrying 
value
£’000
fair value
£’000
carrying 
value
£’000
fair value
£’000
financial assets
investments 311 476510  476510  476510  476510 
cash and cash equivalents 323 85330  85330  114361  114361 
shortterm investment 322 —  —  30000  30000 
other receivables 321 137952  137952  61244  61244 
t otal financial assets   699792  699792  682115  682115 
financial liabilities
t rade and other payables 324 9543 9543 323 323
t otal financial liabilities   9543 9543 323 323 132
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
notes to the company financial statements   431 fair value of financial instruments continued
432 credit risk
the company’s exposures to credit risk arise from holdings of cash and cash equivalents a shortterm investment and other 
receivables excluding prepayments
exposure to credit risk
the carrying value of financial assets as set out in note 431 represents the maximum credit exposure  n o collateral is held as 
security against these assets
cash and cash equivalents and shortterm investment
the company’s exposure to credit risk on cash and cash equivalents and the shortterm investments is managed by investing 
in banks and financial institutions with strong credit ratings and by regular review of counterparty risk in light of the current 
economic climate  the company’s guideline is to maintain transactional bank accounts and term deposits with financial 
institutions which carry a moody’s rating of aa3p1 for longterm and shortterm deposits
other receivables
other receivables at the end of both periods consist primarily of amounts due from subsidiary undertakings  management 
provides for irrecoverable debts when there are indicators that a balance may not be recoverable  
the ageing of other receivables excluding prepayments and the shortterm investment at the balance sheet date is set out 
below
27 november 2011 28 november 2010
  notes
gross
£’000
impairment
£’000
gross
£’000
impairment
£’000
not past due 137952  —  91244  — 
past due 0–3 months —  —  —  — 
past due 3–6 months —  —  —  — 
past due over 6 months —  —  —  — 
  321 137952  —  91244  — 
there were no unimpaired balances at the period end where the company had renegotiated the terms of the other 
receivables  management has not provided for irrecoverable debts against any of its other receivable balances
433 liquidity risk
to manage the working capital needs of the business the company is reliant on being able to negotiate sufficient financing 
arrangements  the company monitors cash flow as part of its daytoday control procedures and the board considers cash 
flow projections on a monthly basis  for further details on the group’s capital management strategy see note 48 in the 
consolidated financial statements
the table below analyses the company’s financial liabilities into relevant maturity groupings based on the remaining period 
at the balance sheet date to the contractual maturity date  the amounts disclosed in the table are the carrying values and 
undiscounted contractual cash flows
  notes 
carrying 
value
£’000
contractual 
cash flows
£’000
1 year  
or less
£’000
1–2  
years
£’000
2–5  
years
£’000
more than 
5 years
£’000
financial liabilities
t rade and other 
payables 324 323 323 323 —  —  — 
28 november 2010   323 323 323 —  —  — 
notes to the company financial statements continued 133 stock code ocdo wwwocadogroupcom
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notes to the company financial statements
 
433 liquidity risk continued
  notes 
carrying 
value
£’000
contractual 
cash flows
£’000
1 year  
or less
£’000
1–2  
years
£’000
2–5  
years
£’000
more than 
5 years
£’000
financial liabilities
t rade and other 
payables 324 9543 9543 9543 —  —  —
27 november 2011   9543 9543 9543 —  —  — 
434 market risk
currency risk
the company engages in foreign currency transactions to a very limited extent  no financial assets are held in foreign 
currencies  due to the company’s lack of exposure to currency risk no sensitivity analysis has been performed
interest rate risk
the company has no interest bearing financial liabilities and its interest bearing financial assets consists of only cash and cash 
equivalents including a shortterm investment in the prior period  these financial assets are exposed to interest rate risk as 
the company holds money market deposits at floating interest rates  the risk is managed by investing cash in a range of cash 
deposit accounts with uk banks split between fixed term deposits notice accounts and money market funds
at the balance sheet date the interest rate profile of the company’s interest bearing financial instruments was
 
 
27 nov ember 
2011
£’000
28 no vember 
2010
£’000
fixed rate instruments
financial assets 37127  70000 
variable rate instruments
financial assets 48203  74361 
sensitivity analysis
an increase of 100 basis points 10 in interest rates at the balance sheet date will increase equity and profit or loss by the 
amounts shown below  a rate of 100 basis points was deemed appropriate considering the current shortterm interest rate 
outlook  this calculation assumes that the change occurred at the balance sheet date and had been applied to risk exposures 
existing at that date  this analysis assumes that all other variables remain constant and considers the effect on financial 
instruments with variable interest rates
 
 
27 nov ember 
2011
£’000
28 no vember 
2010
£’000
equity
gain 800  744 
income
gain 800  744  134
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
notes to the company financial statements   435 financial instruments by category
the company has categorised its financial instruments as follows
  notes
a vailablefor
sale
£’000
loans and 
receivables
£’000
other 
financial 
liabilities at 
amortised 
cost
£’000
total 
£’000
as at 28 november 2010
financial assets
investments 311 476510 — —  476510 
cash and cash equivalents 323 —  114361  —  114361 
shortterm investment 322 —  30000  —  30000 
other receivables 321 —  61244  —  61244 
t otal   476510  205605  —  682115 
financial liabilities
t rade and other payables 324 —  —  323  323 
t otal   —  —  323  323 
  notes
availablefor
sale
£’000
loans and 
receivables
£’000
other 
financial 
liabilities at 
amortised 
cost
£’000
t otal 
£’000
as at 27 november 2011
financial assets
investments 311 476510  —  —  476510 
cash and cash equivalents 323 —  85330  —  85330 
shortterm investment 322 —  —  —  — 
other receivables 321 — 137952  —  137952 
t otal   476510  223282  —  699792 
financial liabilities
t rade and other payables 324 —  —  9543  9543 
t otal   —  —  9543  9543 
44 capital management
the board’s objectives and policies for the company are consistent with those of the group  full details are provided in note 
48 to the consolidated financial statements
notes to the company financial statements continued 135 stock code ocdo wwwocadogroupcom
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our financials our performance
notes to the company financial statements
  
section 5 — other notes
51 subsidiaries
the principal subsidiary undertakings of the company are set out below  a schedule of interests in all undertakings is filed 
with the annual return
  principal activity
share of issued ordinary 
share capital and voting 
rights
country of 
incorporation
ocado holdings limited holding company 100 england and w ales
ocado limited† retail and distribution 100 england and w ales
ocado information t echnology limited† intellectual property 100 republic of ireland
last mile developments limited† property development 100 england and w ales 
ocado cell in atlas insurance pcc limited† insurance company 100 malta
†  wholly owned held indirectly through subsidiary undertakings 
in addition to the companies shown above the company also holds an investment in another subsidiary undertaking which in 
the directors’ opinion do not significantly affect the figures in the consolidated financial statements  in accordance with section 
4102a of the companies act a full list of subsidiaries was annexed to the 2010 annual return and submitted to companies 
house  a full list of subsidiaries will be submitted to companies house in the 2011 annual return
the group has effective control over the financial and operating activities of the ocado cell and therefore consolidates the 
ocado cell in its financial statements in accordance with sic 12 “consolidation – special purpose entities”  the group uses 
the ocado cell to provide selfinsurance for its vehicle fleet and public and product liability claims 136
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
52 related party transactions
key management personnel
only the executive and nonexecutive directors are deemed to be key management personnel  it is the board which has 
responsibility for planning directing and controlling the activities of the company  executive and nonexecutive directors did 
not receive any remuneration for their services to the company
there were no material transactions or balances between the company and its key management personnel or members of 
their close family  at the end of the period key management personnel did not owe the company any amounts
subsidiaries
the company enters into loans with its subsidiaries  interest income of £7000 was earned on these loans at market related 
interest rates during the period 2010 £nil
transactions with subsidiaries
52 weeks 
ended 
 27 nov ember 
2011
£’000
51 weeks 
ended 
28 no vember 
2010
£’000
dividends received from subsidiary undertakings —  — 
equitysettled sharebased payments 596  204 
increase in amounts due from subsidiary undertakings 77020  60668 
increase in amounts due to subsidiary undertakings 9161 —
yearend balances arising from transactions with subsidiaries
27 nov ember 
2011
£’000
28 no vember 
2010
£’000
receivables
loans and receivables due from subsidiaries 137688  60668 
payables
loans and payables due to subsidiaries 9161 — 
53 post balance sheet events
there were no events after the balance sheet date which require adjustment to or disclosure in these financial statements
notes to the company financial statements   notes to the company financial statements continued 137 stock code ocdo wwwocadogroupcom
governance about oc ado our responsibilities
2106604 08022012 proof 1
our financials our performance
glossary
  
2010 code — means the uk 
corporate governance code published 
by the financial reporting council june 
2010 as in force from timetotime
active customers — means customers 
who have shopped in the previous 12 
weeks
administrative expenses — means 
all it costs advertising and marketing 
expenditure employment costs of all 
head office functions which include legal 
finance human resources marketing 
and procurement rent and other 
propertyrelated costs for the head 
office all fees for professional services 
and the depreciation amortisation and 
impairment associated with head office 
it equipment software fixtures and 
fittings and expenses relating to the 
esos and the jsos
admission — means the admission of 
the ordinary shares of the company 
to the premium listing segment of 
the official list and to trading on the 
london stock exchange’s main market 
for listed securities which occurred on 
26 july 2010
agm — means the annual general 
meeting of the company which will be 
held on 23 may 2012 at 11am at one 
bunhill row london ec1y 8yy 
articles — means the articles of 
association of the company
block listing facility — means the 
facility whereby a number of shares 
have been block listed but will only be 
allotted when options under the esos 
and nonemployee share schemes have 
been exercised
board — means the board of directors 
of the company or of ocado limited 
from timetotime as the context may 
require
cfc1 — means the customer 
fulfilment centre in hatfield 
hertfordshire
cfc2 — means the customer 
fulfilment centre in dordon 
w arwickshire
companies act — means the 
companies act 2006
company — means ocado group plc 
a company incorporated in england and 
w ales with registered number 07098618 
whose registered office is at titan court 
3 bishops square hatfield business p ark 
hatfield hertfordshire al10 9ne
corporate website — means 
wwwocadogroupcom
cost of sales — means the cost of 
groceries and other products the 
group sells any associated licence 
fees which are linked to the volume of 
sales of specific products or product 
groups including the branding and 
sourcing fees payable to w aitrose 
adjustments to inventory and charges 
for transportation of goods from a 
supplier to cfc1
convertible preference shares — 
means all convertible preference shares 
convertible into the same number of 
ordinary shares either at the option 
of the holder or on the occurrence of 
certain trigger events including a public 
listing  the convertible preference 
shares rank pari passu with ordinary 
shares with the exception that on 
return of assets they have priority to all 
other shareholders
cstm — means customer service 
t eam member which is the title given 
to our customer facing delivery drivers
customer fulfilment centre or cfc 
— means a dedicated highly automated 
warehouse used for the operation of 
the business
distribution costs — means all the 
costs incurred excluding product 
costs to the point of sale usually the 
customers’ home  this includes the 
payrollrelated expenses for the picking 
dispatch and delivery of product sold 
to the point of sale the cost of making 
those deliveries including fuel tolls 
maintenance of vehicles the operating 
costs of the properties required for 
the picking dispatch and onward 
delivery operations and all associated 
depreciation amortisation and 
impairment charges call centre costs 
and payment processing charges
directors — means the directors of 
the company whose names are set out 
on pages 28 and 29 or the directors of 
ocado limited from timetotime as 
the context may require
disclosure and transparency rules 
— means the disclosure rules and 
transparency rules made by the fsa 
under part vi of fsma
ebit — means operating profitloss 
before interest including interest
on finance leases and taxation
ebitda — means the nongaap 
measure which ocado has defined 
as earnings before net finance costs 
taxation depreciation amortisation 
impairment and exceptional items
ebitda margin — means ebitda as a 
percentage of revenue
ebt — means earnings before tax
ebt t rustee — means the trustee from 
timetotime of the employee benefit 
trust established for the purposes of the 
jsos currently appleby t rust jersey 
limited
esos — means the ocado 2001 
executive share ownership scheme
exceptional items — means items that 
due to their material and nonrecurring 
nature have been classified separately in 
order to draw them to the attention of 
the reader of the financial statements
executive directors — means tim 
steiner jason gissing neill abrams 
andrew bracey and mark richardson
financial period — means the 52 week 
period ending the closest sunday to 30 
november 
financial year — see financial period
frc — means the financial reporting 
council
fy — means financial year
gross sales — means sales net of 
returns including charges for delivery 
before deducting relevant voucher
offers and value added tax
hmrc — means her majesty’s 
revenue  customs
glossary 138
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1
glossary
 
 
ifrs ic — means the international 
financial reporting standards 
interpretations committee
ifrs — means international financial 
reporting standards
ipo — means the initial public offering 
by the company in july 2010
john lewis — means john lewis plc 
the parent company of w aitrose  john 
lewis plc was incorporated in england 
and w ales with registered number 
233462 and its registered office is 171 
victoria street london sw1e 5nn
john lewis pension fund — means 
john lewis p artnership pensions 
t rust which is the corporate trustee 
of the john lewis p artnership t rust 
for pensions  it was incorporated in 
england and w ales with registered 
number 372106 and its registered office 
is 171 victoria street london sw1e 
5nn
jsos — means joint share ownership 
scheme
kpi — means key performance 
indicators
libor — means london interbank 
offered rate
listing rules — means the listing rules 
made by the uk listing authority under 
part vi of the financial services and 
markets act 2000 as amended
management committee — means 
senior management responsible for 
managing the daytoday affairs of the 
business
net finance costs — means finance 
income and finance costs  finance 
income is comprised principally of bank 
interest and other interest  finance 
costs are comprised of interest on bank 
loans and overdrafts interest on finance 
leases and interest on other financing 
arrangements
nonexecutive directors — means 
the nonexecutive directors of the 
company designated as such on pages  
28 and 29
notice of meeting — means the notice 
of the company’s agm
ocado council — means the ocado 
forum used to consult with our 
employees
ocado delivery pass — means the 
ocado discounted prepay delivery 
service available in various offerings 
including monthly quarterly and annually
ocado saving pass — means the 
ocado discount membership scheme 
which entitles customers to receive 
fixed discounts on selected branded 
products from ocado within a 
saving pass group for the length of 
membership and any renewal
other income — means primarily 
advertising revenue for advertising 
services provided by ocado to 
suppliers and other third parties on 
the website commission income and 
sublease payments receivable 
prospectus — means the company’s 
prospectus dated 6 july 2010 prepared 
in connection with the company’s 
admission
revenue — means online sales net 
of returns through the website and 
mobile applications including charges 
for delivery but excluding relevant 
vouchersoffers and value added 
tax  relevant vouchersoffers include 
moneyoff coupons conditional spend 
vouchers and multibuy offers such as 
buy three for the price of two
sharesave scheme — means the 
ocado employee savingsrelated share 
option plan approved by hmrc
shareholder — means a holder for the 
time being of ordinary or convertible 
preference shares
sku — means a “stock keeping unit” 
that is each individual item or product 
stocked
sourcing agreement — means 
the various sourcing and branding 
agreements between ocado w aitrose 
and john lewis
spoke — means the transshipment 
sites used for the intermediate delivery 
of customers’ orders
substitution — means the term used 
to refer to the alternative product 
provided in place of the original product 
ordered by a customer
tsr — means total shareholder return 
– the growth in value of a shareholding 
over a specified period assuming that 
dividends are reinvested to purchase 
additional units of the stock
uk or united kingdom — means the 
united kingdom of great britain and 
northern ireland
uph — means the abbreviation for 
units or eaches per hour
waitrose — means w aitrose limited 
a company incorporated in england 
and w ales with registered number 
00099405
webshop — means the customer 
facing internetbased virtual shop 
accessible on the website
website — means wwwocadocom
glossary continued 139 stock code ocdo wwwocadogroupcom
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2106604 08022012 proof 1
our financials our performance
company information
  
company information
registered office titan court
3 bishops square
hatfield
hertfordshire
al10 9ne
company number 07098618
independent auditors pricewaterhousecoopers llp
chartered accountants and  
statutory auditors
10 bricket road
st albans
hertfordshire
al1 3jx
registrars capita registars
the registry
34 beckenham road
beckenham
kent
br3 4tu
    140
ocado group plc  annual report and accounts for the 52 weeks ended 27 november 2011
2106604 08022012 proof 1 this annual report is printed by an fsc
®
 forest stewardship council certified 
printer using vegetable based inks
this report has been printed on novatech matt a white coated paper and board 
using 100 efc pulp ocado group plc
titan court 3 bishops square  
hatfield business park hatfield al10 9ne uk
tel 44 0 1707 227800
fax 44 0 1707 227999
wwwocadogroupcom
visit our online annual report and accounts at
results11ocadogroupcom


Summary:
 03 stock code ocdo wwwocadogroupcom
governance about oc ado our responsibilities our financials our performance
2106604 08022012 proof 1
chairman’s letter  
  chairman’s letter
dear shareholder
overview
w e are now in our second year as a public listed company 
and i am pleased to report that the business continues to 
see significant sales growth and improvements in operational 
profitability
during the year the group invested heavily and continues to 
do so in the development of its second customer fulfilment 
centre at dordon w arwickshire  this major development will 
ensure ocado is in a prime position to take full advantage of the 
rapid growth expected in the online grocery business over the 
coming years  
people
i am greatly inspired and hugely impressed by the level of 
service and quality of offering that our people deliver  ocado’s 
impressive record in achieving awards for innovation and quality 
of service continued during the year and is testament to the 
efforts and talent of our workforce  i wish to thank all members 
of the ocado family for their continued support
board changes
andrew bracey has resigned as chief financial officer from the 
board and a process is underway to find a new chief financial 
officer  andrew is expected to leave after the publication of this 
annual report david young who joined the board in 2000 has 
also expressed his intention to resign as nonexecutive director 
at the agm  i would like to pay thanks to andrew and david 
for their valuable contribution to the success of ocado and wish 
them every success for the future  
w e welcomed mark richardson to the board in the newly 
created role of operations director  since 2001 as head 
of technology mark had led the ocado technology team in 
developing our website mobile applications and warehouse it 
system
existing board members jason gissing and neill abrams also 
had changes to their roles during the period  jason has taken on 
the new board position of commercial director and neill has 
assumed responsibility for human resources in addition to his 
current role as legal and business affairs director
w e also welcomed three new nonexecutive directors onto 
the board in douglas mccallum w endy becker and alex 
mahon  douglas’ highlevel experience in ecommerce and it   
w endy’s wealth of experience in retail technology and customer 
service and alex’s experience in media strategy and corporate 
development will complement the skill set of the existing board  
w endy will chair the remuneration committee upon the 
retirement of david young 
corporate governance 
the board has a wide range of responsibilities  there are three 
that are particularly important for the success of the business 
first to debate determine and oversee the execution of our 
strategy second to ensure that we have the most talented 
team to execute this strategy and that we plan effectively for 
succession and third to ensure effective governance
securing the right balance of skills experience and perspectives 
on the board is a key responsibility to ensure that the board 
works effectively as a team towards shared goals with the right 
mix of enquiry and support of the executive directors from the 
nonexecutive directors  the nomination committee report 
on pages 36 to 37 describes this work  w e always seek to run 
our business in a responsible way and we have a very strong 
team which is mindful of its responsibilities not just in helping to 
deliver the strategy but also in overseeing financial controls and 
risk management
our governance reporting obligations are set out in the uk 
corporate governance code  the appointment of the three 
new nonexecutive directors moves the board closer to the 
board’s desired full compliance with the 2010 code in respect 
of board independence  a detailed statement of corporate 
governance can be found on pages 30 to 45 of this annual 
report  
i am also mindful of my responsibility as chairman to lead the 
board and ensure that it is working effectively  this year a board 
evaluation was carried out with the frc’s guidance on board 
effectiveness in mind  i am encouraged as reinforced by our 
board’s performance review that our board operates effectively 
and is properly engaged 
corporate social responsibility
operating our business in a responsible way is fundamental both 
to the way we operate and to delivering sustainable profits and 
longterm value for our shareholders
w e have continued to explore methods of reducing our impact 
on the environment including the use of anaerobic digestion to 
produce electricity from our food waste use of electric vans in 
our london spokes and continuing our closedloop carrier bag 
recycling system  w e have also supported the japan appeal and 
macmillan cancer support among other important causes  the 
corporate social responsibility report found on pages 24 to 27 
describes our responsibilities here 
looking forward
i am excited about ocado’s future and i look forward to the 
continued expansion of our business  as a board we remain 
confident that our strategy and business plan will allow ocado 
to grow and deliver our commitment to create value for our 
shareholders
lord grade of yarmouth
chairman 
ocado group plc
lord grade of yarmouth
chairman