Partner Article

Morrisons resilient amid tough conditions

Supermarket Morrisons posted a fall in pre-tax profits on the stock exchange Thursday morning, down 4% to £901m.

Earnings per share remained the same as 2011/12 at 26.7 pence, while its total dividend for the year rose by 10% to 11.8 pence.

However, like-for-like sales were down 2.1%, although Morrisons reported a rise in its revenues, up 3% to £18.1bn, while the store also announced a £200m reduction in capital expenditure.

Further to their financial results, the supermarket said strategic changes were going well, with the vertical integration of its manufacturing bases in Winsford and Grimsby, as well as 12 new stores opened in its new convenience format, and 17 new supermarkets.

Productivity improvements of 4% were also reported, along with 5,000 newly launched ‘own brand’ products and improvements made in the company’s IT systems.

Sir Ian Gibson, the firm’s chairman, said: “Although this has been a difficult year in trading terms for Morrisons as we struggled to grow sales in a tough consumer environment, we have delivered […] in line with our previously stated policy.

“It has also been a period of significant strategic progress as we continue to lay the foundations for future growth.”

Dalton Philips, chief executive for Morrisons, added: “The sustained pressure on consumer spending was reflected in our like-for-like sales performance, which was not as good as it should have been.

“Recent events have underlined why it’s so important that we tell our customers how and why we’re different and what our vertical integration really means for them.

“Food quality, provenance and the issue of trust are at the forefront of consumers’ minds and these are all areas where Morrisons has something genuinely different to offer.”

Morrisons also announced this morning it is in talks with online supermarket Ocado, who will help the store launch its own online food section.

Mr Philips continued: “Today’s announcement that we are launching an online food offer in 2014 is another important step in Morrisons strategy of being ‘Different and Better than Ever’.

“We may be a late entrant to the online food market but we have learnt from our involvement with Kiddicare and Fresh Direct.

“We have long been a leader in fresh food and our craft skills and vertical integration really set us apart from the competition.

“Ensuring that these points of difference translate into our online food offer will be a priority.”

This was posted in Bdaily's Members' News section by Miranda Dobson .