Morrisons will start its online groceries business by the end of 2013 after unveiling a tie-up with Ocado. The launch will see Morrisons use Ocado's new distribution centre in Warwickshire for deliveries using a Morrisons-liveried fleet. The 25-year deal involves Morrisons paying up to £170 million to Ocado to acquire the site and equipment. The customer gets affordable fresh food delivered by Ocado's distribution system. With the addition of planned new capacity, the Ocado site at Dordon, Warwickshire, will be able to handle up to 190,000 orders a week at its peak. About half of this will be available to Ocado. The company will initially pay Ocado up to £170 million to acquire Dordon and associated handling equipment as well as a licence and integration fee. A further £46 million will be invested to expand Dordon to accommodate the Morrisons range, link it to Morrisons' systems and establish a delivery network.

Wm. Morrison Supermarkets plc - Shareholder/Analyst Call

Wm. Morrison Supermarkets plc reported interim management statement earnings results for the first quarter ended May 5, 2013. Total sales excluding fuel were up by 0.6%, down 0.3% including fuel and like for like sales were down 1.8%, 2.6% including fuel. This performance (excluding fuel) reflects a steady improvement from the previous quarter and is in line with the expectations. Throughout the quarter the industry has remained very competitive with couponing again a significant factor. The company continued to focus on communicating the points of difference more clearly and sharpening the promotional programme. As on May 5, 2013, net debt was £2.3 billion in line with expectations. The company provided earnings guidance for the year 2013. For the year, the company's CapEx guidance is increasing by £100 million to £1.2 billion. And as a result, full year net debt guidance increases to £2.7 billion. The company will also incur a further £25 million of development cost, bringing total new business development investments in the P&L for the year to £65 million. The company expects 100 stores by the end of the year 2013, additional to what it had in -- or what ended in fourth quarter, so it will be over 200 stores.