The retailer remained confident of hitting its medium-term profit target, after achieving £18M of incremental profit from wholesale, services, interest and online.
Like-for-like sales were up 1.7% in the 12 months to January 29, and underlying earnings per share was up 39.8% to 10.86p. It was the retailer’s first year of growth in like-for-like sales and underlying profit since 2011/2012, it said.
Morrisons chief executive David Potts said the retailer’s food manufacturers helped to deliver the results.
“Our full year of like-for-like sales and profit growth was powered by listening to customers, and shows what our hard-working team of food makers and shopkeepers can do,” he said.
‘Turnaround has just started’
“But, it’s only one year. Our turnaround has just started, and we have more plans and important work ahead. If we keep improving the customer shopping trip, I am confident that Morrisons will continue to grow.”
The retailer warned, however, that it expected imported food prices to rise in the future, if the value of sterling remained low.
Morrisons also said: “We have identified further cost saving opportunities beyond the £1bn already achieved, in ordering, distribution between manufacturing and retail, in-store administration and procurement of goods not for resale.”
‘Very good set of preliminary results’
Morrisons was delivering progress than Sir Ken Morrison would have been proud of, Shore Capital said, in what it said was a “very good set of preliminary results”.
Shore Capital analysts Clive Black and Darren Shirley said: “Morrisons is in decent shape.
“The group has a very strong financial strategy and backbone that is complementing the retail performance, leading to growth from positive operational gearing and incremental avenues that embrace lower financing costs.”
Sir Ken Morrison died last month after a short illness. He was described as “one of the most distinguished businessmen that we have had the pleasure of knowing”.
Meanwhile, last month Morrisons revealed it was seeking at least 200 new British food and drink suppliers, after a report claimed only 52% of food eaten in the UK came from British farmers.
Morrisons results – at a glance
- Like-for-like sales up 1.7%
- Underlying profit before tax up 11.6% to £337M
- Earnings per share up 39.8% to 10.86p