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Morrisons profits surge 50% but supermarket warns of price rises due to Brexit-hit pound | Morrisons profits surge 50% but supermarket warns of price rises due to Brexit-hit pound |
(about 4 hours later) | |
Morrisons has reported a surge in full-year profits as the supermarket cements its turnaround and reaps the rewards of investment into cutting prices. | Morrisons has reported a surge in full-year profits as the supermarket cements its turnaround and reaps the rewards of investment into cutting prices. |
However, it sounded a note of caution on the year ahead, warning of the “impact on imported food prices if sterling stays at lower levels”. | However, it sounded a note of caution on the year ahead, warning of the “impact on imported food prices if sterling stays at lower levels”. |
Food prices are beginning to rise on supermarket shelves as producers begin to pass on soaring import costs triggered by the Brexit-hit pound. | Food prices are beginning to rise on supermarket shelves as producers begin to pass on soaring import costs triggered by the Brexit-hit pound. |
The Bradford-based grocer reported a 49.8 per cent rise in pre-tax profits to £325m and notched up like-for-like sales growth of 1.7 per cent in the year to January 29 and 2.5 per cent in the fourth quarter. | The Bradford-based grocer reported a 49.8 per cent rise in pre-tax profits to £325m and notched up like-for-like sales growth of 1.7 per cent in the year to January 29 and 2.5 per cent in the fourth quarter. |
Revenue came in at £16.3bn, up 1.2 per cent, as the results solidified the chain's return to form under chief executive David Potts. | Revenue came in at £16.3bn, up 1.2 per cent, as the results solidified the chain's return to form under chief executive David Potts. |
He said: "Our full year of like-for-like sales and profit growth was powered by listening to customers, and shows what our hard-working team of food makers and shopkeepers can do. | He said: "Our full year of like-for-like sales and profit growth was powered by listening to customers, and shows what our hard-working team of food makers and shopkeepers can do. |
"But, it's only one year. | "But, it's only one year. |
"Our turnaround has just started, and we have more plans and important work ahead. | "Our turnaround has just started, and we have more plans and important work ahead. |
"If we keep improving the customer shopping trip, I am confident that Morrisons will continue to grow." | "If we keep improving the customer shopping trip, I am confident that Morrisons will continue to grow." |
On an underlying basis, profits rose 11.6 per cent to £337m, the first time in five years they have moved in an upward trajectory. | On an underlying basis, profits rose 11.6 per cent to £337m, the first time in five years they have moved in an upward trajectory. |
The company said its Price Crunch initiative has seen more customers come through its doors. | The company said its Price Crunch initiative has seen more customers come through its doors. |
Morrisons, which secured a deal to sell groceries through Amazon under Mr Potts, added the internet titan's lockers are now in over 400 of its stores. | Morrisons, which secured a deal to sell groceries through Amazon under Mr Potts, added the internet titan's lockers are now in over 400 of its stores. |
In addition, following a successful trial, a similar roll-out is also planned with Doddle. | In addition, following a successful trial, a similar roll-out is also planned with Doddle. |
As well as the deal with Amazon, Mr Potts has ploughed investment into price cuts and called time on under-performing stores in his attempts to turn the page on the supermarket's ill-fated era under ousted boss Dalton Philips. | As well as the deal with Amazon, Mr Potts has ploughed investment into price cuts and called time on under-performing stores in his attempts to turn the page on the supermarket's ill-fated era under ousted boss Dalton Philips. |
His efforts come as the grocery sector's big four, Tesco, Asda, Sainsbury's and Morrisons, remain locked in a bitter price war sparked by German discounters Aldi and Lidl, and face further challenges from an expected slowdown in consumer spending. | |
But chairman Andrew Higginson said: “Food retail is a simple business, but it is not easy. | But chairman Andrew Higginson said: “Food retail is a simple business, but it is not easy. |
“Only consistent and outstanding execution differentiates. | “Only consistent and outstanding execution differentiates. |
“I am delighted that the whole Morrisons team are making a real difference. | “I am delighted that the whole Morrisons team are making a real difference. |
“I am confident that strong execution will drive sustained dividend growth and improving returns for Morrisons shareholders.” | “I am confident that strong execution will drive sustained dividend growth and improving returns for Morrisons shareholders.” |
PA | PA |
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