In its third quarter period supermarket group Morrisons saw total sales excluding VAT rise 4.6 per cent and like-for-like sales grow 2.4 per cent compared to last year, results released today reveal.
This strong trading performance over the 13 weeks ending October 30th 2011 compares well with the other major players in the UK grocery market, with the retailer claiming record numbers of customers are currently coming to its stores.
Morrisons has been undertaking a significant expansion scheme, helping push total sales including VAT up 7.6 per cent during Q3, which has seen nine large stores and the company’s second convenience outlet open since the summer.
By the end of the year the supermarket group hopes to have met its 12-month target of adding 600,000 sq ft of new space to its store portfolio, and claims it is currently on target to meet this objective.
A statement from the retailer today read: “We have previously set out a range of operating and strategic initiatives designed to generate profitable growth; driving our topline, increasing our efficiency and capturing new growth opportunities.
“We made good progress in each of these areas during the period.”
Borrowing facilities for the retailer have been extended through the conclusion of a $250 million (£157 million) US private placement agreement over 15 years, and it says its financial position remains strong as it continues it two-year plan to retire £1 billion of equity.
Matt Piner, Lead Consultant at analyst firm Conlumino, says that Morrisons performance has remained consistently impressive since the downturn of 2008, partly due to its small range of non-food items compared to its competitors but also because of the good value products it offers.
Piner said: “It has … read consumer demands extremely well, offering a careful balance of low prices combined with fresh, local products.
“It has distanced itself from the sporadic ‘price wars’ of the other big players, in favour of building up a long term trust with its customers that it will steadfastly save them money, while also offering them quality food.
“This dependability has made it very popular at a time when consumers are jittery and searching for value.”
Although Morrisons remains cautious of the economic environment, it remains confident of meeting its board’s full-year expectations on trading.