In the supermarket’s sixth consecutive quarter of sales growth, Morrisons reported a 2.8% rise in total sales, excluding fuel; ahead of analysts expectations. The like-for-like number of transactions also increased 4.6% in the 13 weeks to April 30.
Potts said: “Our new financial year has started well, thanks once again to the dedication of our team of food makers and shopkeepers. We are improving the shopping trip in many different ways, which is making Morrisons more popular and accessible for customers.”
Morrisons’ business turnaround continued to gather momentum, he added.
“These new initiatives in-store, online, in wholesale and services are beginning to build a broader, stronger Morrisons,” said Potts. “We are confident we will continue to turnaround and grow Morrisons. Our expectations and guidance for 2017/2018 are unchanged, including year-end net debt of less than £1bn.”
Morrisons performed well throughout the quarter, especially during the Valentine’s Day, Mother’s Day and Easter, Potts said. Customer satisfaction improved in the 13 weeks, check-out queues were shorter in busy periods and it introduced a new ordering system.
Looking past external pressures
Imported food prices were affected by the weakened value of sterling, Morrisons said. But, the supermarket was looking past external pressures to become more competitive for customers, it added. It introduced a wave of ‘Price Crunch’ lower prices this week.
Morrisons’ sales were above analyst Shore Capital’s 1.75% to 2% expectations. The analyst said last week (April 26) that the retailer was “in much better shape” than it was last year, as it further exploited manufacturing capacity.
Meanwhile, Morrisons maintained its position as Britain’s fourth largest supermarket in Kantar Worldpanel’s latest market share report. But, Morrisons total UK market share fell 0.2% to 10.4%.
Morrisons latest ‘Price Crunch’ cuts
- Whole cucumber: £0.50 to £0.45
- Carrots (1kg): £0.60 to £0.47
- Salad tomatoes (six pack): £0.68 to £0.60
- Salad peppers (three pack): £0.96 to £0.84
- Snack pork pies (four pack): £1.50 to £1.00
- Seasonal baby leaf salad (100g): £1.27 to £1.00
- Steak and ale pie (550g): £3.48 to £2.80
- Medium white baps: £0.72 to £0.67
- Bran Flakes (1kg): £1.84 to £1.46
- PG Tips (80): £2.50 to £2.25