One-off costs dent Morrisons’ profit growth as half-year revenues rise to £8.8bn

Morrisons has posted underlying profit and revenue growth as it continues working to build “a better and better business”.

The supermarket chain, which is now more than three years into a turnaround strategy to ‘Fix, Rebuild and Grow’ its operation, grew revenues 4.5% to £8.8bn in the six months to August 5.

The firm’s underlying pre-tax profit hit £193m, up 9% against the £177m recorded for the same period in 2017.

But in real terms, profit before tax was down year on year by 29%, falling from £200m to £142m.

Morrisons’ reported pre-tax profit was dented by £33m in one-off costs relating to successful tender offers completed in the first half of the year, and other sizable exceptional items including a £8m net pension income and £28m in relation to increased stock provisioning.

Elsewhere, the firm managed to slash its net debt by £44m since the end of 2017/18. As of August 5, Morrisons owed £929m.

Chief exec David Potts said: “Strong growth, including our best quarterly like-for-like sales for nearly a decade, together with another special dividend for our shareholders, shows how new Morrisons can keep improving for all stakeholders.

“Morrisons continues to become broader, stronger and a more popular and accessible brand, and I am confident that our exceptional team of food makers and shopkeepers can keep driving the turnaround at pace.”

Chairman Andrew Higginson commented: “With each passing quarter, the Morrisons team is building a better and better business.

“New customers try Morrisons and tell us they really enjoy shopping with us: our friendly colleagues, the quality of our fresh food and our low prices. We look forward to more and more customers trying Morrisons.”