Internet retailer Ocado saw half-year sales today but slumped back into the red after it was hit by the opening of new warehouses.
The company, which is chaired by former Marks & Spencer boss Sir Stuart Rose, said growing customer numbers boosted revenues by 15% to £382.7 million.
However, the cost of opening two warehouses in Dordon, Warwickshire and Welwyn Garden City, Hertfordshire saw the retailer record pre-tax losses of £3.8 million from maiden profits of £200,000 a year earlier.
Ocado chief executive Tim Steiner said the agreement with Morrisons would have no impact on its existing arrangements.
We will continue to source products under our long-term agreement with Waitrose, and our customers will continue to benefit from the existing high levels of service, wide range of products and competitive prices that they currently enjoy.
The former boss of Marks and Spencer, Sir Stuart Rose, is taking over as Chairman of online grocer Ocado. Rose left M&S at the start of 2011 after a six years. Ocado sales were up 14% over Christmas, to £91.6 million in the six weeks to January 6.
Sir Stuart Rose said: "I have been very impressed at the impact and progress Ocado has made to date. As retail goes through a fundamental shift into the digital world, I believe Ocado's model and the high standards of customer service it provides will see it emerge as a powerful online player."
Despite a successful Christmas, Ocado has yet to post an annual profit.