// Morrisons records £27 million in Covid-19 costs during its first quarter
// The Big 4 grocer has forecast stronger annual profits after like-for-like sales increased
// The chain described its sales performance as “robust” despite the pandemic-related costs
Morrisons has recorded £27 million in Covid-19 costs during its first quarter but remains confident as the latest restrictions ease.
The Big 4 grocer has forecast stronger annual profits after like-for-like sales, excluding fuel, rose 2.7 per cent in the 14 weeks to May 9 when compared to the same period of 2020.
Fuel sales at the supermarket jumped 17.5 per cent, contributing to a 5.3 per cent rise in total sales.
The chain described its sales performance as “robust” despite the pandemic-related costs, which came about due to staff absence and use of marshals.
Morrisons highlighted delivery sales growth of 113 per cent on the same three month period last year and wholesale like-for-like growth of 21 per cent.
It said fuel sales had almost returned to pre-crisis levels, with sales up by more than 17 per cent.
It was a factor behind its prediction that net debt would fall and it maintained its guidance that profit before tax and exceptional items would be higher than the £431 million it would have achieved last year, had it not waived £230 million of business rates relief.
“As the period progressed there were encouraging signs both of significantly lower direct Covid-19 costs and of the recovery of profit lost due to the pandemic in areas such as fuel and food-to-go,” Morrisons said.
“We are also looking forward to the lost profit gradually returning at our cafés from when they reopen next week.”
Morrisons chief executive David Potts said: “The pandemic is not yet over, but it is in retreat across Britain and there is much to be positive about as something approaching normal life begins to take shape.
“Our forecourts are getting busier, we are seeing encouraging recent signs of a strong rebound of food-to-go, take-away counters and salad bars, and our popular cafes will soon fully reopen.
“The nation has a summer of socialising and sport to look forward to and we’ll all be able to rediscover the joys of meeting up and eating well together. Whichever way consumers choose to enjoy their renewed freedom, we will be there for them.”