Ocado warns of setback after 'substantial' fire damage

Ocado said a fire at one of its automated warehouses has caused "substantial damage" and will hold back its ability to meet growing customer demand.

Shares in the online grocer fell 7% after it said the blaze at the Andover site in Hampshire, which represents 10% of its current capacity, would mean a reduction in sales growth.

Ocado said the fire, which began in the early hours of Tuesday morning, had not been contained as initially believed and later expanded.

In an update issued to the stock market on Wednesday, the company said it had now been informed by the fire brigaed that the blaze was under control.

But it said that during the night part of the roof collapsed and that there had been "substantial damage to the majority of the building and its contents".

Ocado said no workers or members of the public had been injured and that it was grateful to the emergency services.

It also said it had comprehensive insurance for the property, stock and equipment on site, and for business interruption losses.

But the company added: "As Andover was providing approximately 10% of our current capacity, as a result of this incident there will be a constraint on our ability to meet growing customer demand and there will be a reduction in sales growth until we can increase capacity elsewhere."

A number of customers have used the company's Twitter account to complain about failed deliveries over the period since the blaze broke out, with a standard reply blaming "operational issues".

The Andover site processes up to 65,000 orders per week when operating at full capacity.