Online grocer Ocado has said its retail business remains on track to return to full-year profit as it posted a rise in first quarter sales despite ongoing "challenging" trading.

The group said its retail arm, which is run as a joint venture with high street giant Marks & Spencer, delivered a 3.4pc rise in revenues to £583.7m over the 13 weeks to February 26.

But with price inflation stripped out, sales by volume are still falling as customers buy less per shop.

It said average basket sizes fell 7.5pc to 45 items, offset by an 8.3pc surge in average selling prices amid surging food inflation.

Ocado stuck to its full-year guidance, reiterating it expects the retail business to remain loss making in its first half, but hopes to swing out of the red by the year end as sales growth recovers, leaving it with marginal underlying earnings growth for the full year.

Three gambling businesses owned by William Hill will pay a total of £19.2m for "widespread and alarming" social responsibility and anti-money laundering failures, the Gambling Commission has announced.

The failures of social responsibility at William Hill businesses included allowing one customer to open a new account and spend £23,000 in 20 minutes.

Another was allowed to open an account and spend £18,000 in 24 hours and a third able to spend £32,500 over two days - all without any checks.

The "settlement" is the largest in the Gambling Commission's history. Gambling Commission chief executive Andrew Rhodes said: 

When we launched this investigation the failings we uncovered were so widespread and alarming serious consideration was given to licence suspension.

However, because the operator immediately recognised their failings and worked with us to swiftly implement improvements, we instead opted for the largest enforcement payment in our history.

WHG (International) Limited, which runs williamhill.com, will pay £12.5m.

Mr Green Limited, which runs mrgreen.com, will pay £3.7m and William Hill Organisation Limited, which operates 1,344 gambling premises across Britain, will pay £3m.

The British Retail Consortium (BRC) said prices also went up as imports became more expensive thanks to a weaker pound.

Retail editor Hannah Boland has the details:

BRC chief executive Helen Dickinson said shop price inflation had not yet peaked, although rises could start to ease as the UK enters its growing season and more British produce makes it onto shelves.

She added: "Wider inflation is expected to remain high. Retailers continue to work hard to keep prices, particularly of essentials, as low as possible by expanding value ranges and offering discounts for vulnerable groups."

Higher costs have forced several supermarkets, including Morrisons, into a price war in order to retain customers. 

Waitrose earlier this month said it was trimming back ranges amid pressure to cut costs in the face of inflation which had "hit like a hurricane". 

Despite this, overall, retailers upped their prices by 0.8pc in March compared to February across their ranges of food and non-food items. 

Shop price inflation reached a new high in March amid warnings that soaring food costs are yet to peak.

Shop prices are now 8.9pc higher than they were a year ago, up from February's 8.4pc increase, according to the British Retail Consortium (BRC)-NielsenIQ index.

Overall food inflation accelerated to 15pc, up from 14.5pc last month, while the price of fresh food is now 17pc higher than last March - the highest rate on record.

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What happened overnight 

Asian shares were mostly higher as investors got some relief from worries over troubled US banks with a planned takeover of failed Silicon Valley Bank.

Australia's S&P/ASX 200 jumped 1.1pc to 7,036.20. South Korea's Kospi added 0.4pc to 2,419.43. 

Hong Kong's Hang Seng rose nearly 0.4pc to 19,644.68, while the Shanghai Composite inched up less than 0.1pc to 3,249.39.

However, Japan's benchmark Nikkei 225 lost 0.1pc to 27,456.98. 

Wall Street was boosted by bank stocks which rose on renewed hopes that the turmoil in the sector will be contained following the buyout of Silicon Valley Bank.

The Dow Jones Industrial Average rose 0.6pc to 32,432.08, the S&P 500 gained 0.2pc to 3,977.53 and the Nasdaq Composite fell 0.5pc to 11,768.84.

The yield on the benchmark 10-year Treasury climbed to around 3.54pc, while the interest rate-sensitive two-year jumped to 4.02pc. The inverted yield curve - where the short-term rate is higher than the long-term - continues to signal a downturn ahead.