Ocado Group PLC (LON: OCDO) surged more than 11% at the open after securing a larger-than-expected $350m cash settlement from its US partner Kroger Co (NYSE: KR, XETRA: KOG). The payout exceeds the $250m figure indicated last month and follows Kroger’s decision to reshape its fulfilment network.
Kroger will make the one-off payment after opting to close three Ocado-powered customer fulfilment centres (CFCs) in Maryland, Wisconsin and Florida. That announcement in mid-November had sent Ocado’s shares down 17%.
Despite the closures, the companies continue to operate five CFCs in Monroe, Dallas, Atlanta, Denver and Detroit. Ocado said its teams remain fully integrated across the network and highlighted improvements in efficiency, volumes and same-day delivery availability.
Chief executive Tim Steiner said the group is investing heavily to support Kroger and deepen the partnership, noting that Ocado’s technology stack has evolved to include both new systems Kroger is introducing in its CFC network and a wider range of fulfilment solutions, such as Store Based Automation for click-and-collect and rapid-delivery services.
He added that Ocado partners worldwide are successfully using its fulfilment platforms to serve varied geographies and customer bases, and that the company sees strong long-term potential in the US market.
The closure of the three sites will reduce Ocado’s FY26 fee revenue by around $50m, but the group reaffirmed its goal of achieving cash-flow positivity in FY26, supported by growth in live and upcoming sites and tight cost and capital discipline.
