Morrisons suffers first quarterly sales drop since 2016

Morrisons ends run of 14 consecutive quarters of growth by posting a 1.9% fall in sales & Amazon deal deepened
Morrisons' half-year report had tough comparisons to robust figures from last year.
// Morrisons ends run of 14 consecutive quarters of growth by posting a 1.9% fall in sales
// Bosses insist the turnaround remains on track as half-year profits rise 5.3%
// Morrisons also signed a long-term partnership with Amazon “over a number of years” to explore “new opportunities”

Morrisons has reported its first fall in quarterly underlying sales since 2016 but bosses insisted its turnaround remains on track.

In its interim report for the half-year period ending August 4, the Big 4 retailer said it had maintained momentum in its turnaround plan and had seen “robust progress” in sales and profit, with the latter rising 5.3 per cent during the period to £198 million.

On a statutory basis, half-year profit before tax skyrocketed 48.5 per cent year-on-year to £202 million and Morrisons said it would pay out a special dividend to shareholders.

Total half-year revenue also increased, albeit marginally by 0.4 per cent year-on-year to £8.83 billion.

Half-year like-for-like sales – excluding fuel and VAT sales tax – was up 0.2 per cent, although this was a slowdown on the 4.9 per cent increase recorded this time last year.

However, like-for-like sales for the second quarter was down 1.9 per cent against tough comparisons of a 6.3 per cent increase last year, making it Morrisons’ first decline in quarterly like-for-likes since 2016.

The retailer also used its half-year trading update to revealed it has deepened its relationship with Amazon, signing a long-term partnership “over a number of years” to explore “new opportunities”.

“We stayed focused on our fix, rebuild and grow strategy, and were pleased to maintain the momentum of the turnaround against strong comparatives last year,” Morrisons chief executive David Potts said.

“Sales and profit progress was robust and we again invested in improving our competitiveness for customers.”

Chairman Andrew Higginson said: “I’m confident that Morrisons is on the right path for continued and sustainable growth.

“The team are listening and responding to customers, and making the right choices to benefit all stakeholders, including strong dividends for shareholders.”

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