UK grocer Morrisons’ full-year expectations remain unchanged following the posting of solid first quarter sales today.
Total sales excluding VAT rose 4.2 per cent for the retailer in the 13 weeks to May 1st 2011, whilst like-for-like (LFL) trading excluding VAT increased by 2.5 per cent.
Although underlying consumer confidence remained low over the period, Morrisons’ successful promotions over the recent bank holidays helped boost business.
A statement from Morrison read: “Morrisons has made an encouraging start to its new financial year with sales growth continuing ahead of the market.
“In this environment our unique fresh and quality offer, backed by value pricing and an outstanding and innovative promotional programme has again proved to be exactly what consumers want.
“Our “Biggest Ever Price Crunch” promotion at the start of the year and our “Fuel Britannia” and “Let’s Celebrate” campaigns for Easter and the royal wedding, have attracted record numbers of customers into our stores.”
Morrisons is eyeing a significant amount of growth during this financial year, having set out plans to increase store numbers and develop its multichannel offering when it announced its year-end results in March.
During that announcement the supermarket chain confirmed that it intended to retire £1 billion of equity over the next two years and so far has managed to acquire 24.7 million shares at a total investment of £68.7 million.
Many major supermarkets have been struggling for sales in recent months, with leading grocer Tesco seeing a fall in LFL trading in its Q4 ending in February, and although business improved over Easter, expecting a resurgence in consumer spending may be foolhardy according to Morrisons.
Today’s statement continued: “The board is encouraged by the group’s progress in the first quarter but with consumers’ disposable incomes falling and an uncertain economic environment, we remain cautious. Our overall expectations for the full year remain unchanged.”