This article is from the source 'independent' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.

You can find the current article at its original source at http://www.independent.co.uk/news/business/news/morrisons-likeforlike-sales-down-71-9335309.html

The article has changed 2 times. There is an RSS feed of changes available.

Version 0 Version 1
Morrisons' like-for-like sales down 7.1% Morrisons' like-for-like sales down 7.1%
(about 5 hours later)
Morrisons has reported a significant plunge in sales as the supermarket’s failed attempt to fightback against discounters Aldi and Lidl and adds pressure on chief executive Dalton Philips. Morrisons has reported a significant plunge in sales as the supermarket’s failed attempt to fightback against discounters and adds pressure on chief executive Dalton Philips.
Morrisons’ sales at stores open longer than a year fell 7.1 per cent in the first quarter amid what is dubbed a “competitive” market. Total sales fell 4.2 per cent. Morrisons blamed the continuing plunge in like-for-like sales in the first quarter on a competitive market in which Aldi and Lidl enjoy rapid growth, driven by a wave of bargain-hungry customers.
The supermarket is attempting to counter the rapid rise of the German discounters as well as prices slashed by its major grocery competitors. The grocer last week slashed the price of 1200 lines by 17 per cent to counter the rise of the German discounters, which instilled fresh energy into its two-year battle to report like-for-like sales growth.
The latest sales fall will leave Philips again defending his strategy which has included revamping its stores, open more convenience shops and building up an online business in partnership with Ocado. But Philips insisted that tour of 100 financial institutions as part of the grocer’s investor roadshow, which concluded last week, had “shown we have broad support for our strategy”.
Last week, Morrisons announced price cuts on 1,200 lines in an attempt to charm shoppers. It also plans to save £1 billion in costs over three years as it attempts to invest to return to form. “I’m very confident we are doing the right things,” said Philips. “My job is to make big, bold decisions. The proof will be when there are more items in more baskets — how could it not be the right strategy to tackle this on price?”
Philips said: “The plans we set out at our results in March are on track.  The reaction of our customers to the 1,200 “I’m Cheaper” price cuts we announced last week has been very positive.  Sainsbury’s outgoing chief executive Justin King yesterday accused Morrisons of “playing catch-up” in lowering prices.
“Although it will take time for their full impact to be felt, we are confident that these meaningful and permanent reductions in our prices will enable our clear points of difference to resonate strongly with consumers.”  Philips retorted: “We are very competitive on our pricing, Sainsbury’s customers do not have the advantage of these cuts as they do not cover us in their Brand Match promotion.
Morrisons said profit forecasts remain unchanged with full-year pre-tax profits expected to hit between £325m and £375m. “I’m happy with our position among the Big Four on price,  but versus the discounters we can  be cheaper.”
Pressure on Philips has intensified as criticism from analysts and former directors has added to a catalogue of problems including a huge payroll data leak and an angry backlash against the projection of an ad on the Angel of the North.
Philips’ strategy includes slashing prices and swiftly building up its food online and convenience shops arms.
Its long-awaited online grocery service will be launched in London next Friday in partnership with Ocado, with a trial in Ruislip.