Coles Group (ASX:CGJ) has unveiled an update on the Ocado CFC project.

The firm has received a delay notification from its partner, Ocado, regarding the transfer of the Victorian CFC project.

It appears that additional works are now required to correct some construction problems identified during quality control procedures for the Victorian CFC.

As a result, the commissioning of the Victorian CFC is set to be delayed, with the incremental ramp-up period now projected to commence in mid-FY25.

Moreover, the timing for the New South Wales CFC project built by Ocado is anticipated to be commissioned with an incremental ramp-up period starting at the end of 2H FY24.

Coles warned that the delays may escalate project capital and operating expenses by A$70 million and A$50 million, respectively.

The firm now anticipates that capital expenditure will be A$400 million, of which 55% has already been spent by the end of FY23.

The balance of the total capital expenditure of A$400 million is expected to be incurred in FY24 and FY25.

Coles Group is an Australian corporation operating several retail chains.