Morrisons sees small sales rise & expands wholesale supply initiatives

Morrison's has reported interim results for the half year to 4 August 2019 showing group like-for-like (LFL) sales (ex-fuel/ex-VAT) were up by 0.2% (2018/19: 4.9%).

Q2 Group LFL sales (ex-fuel/ex-VAT) decreased by 1.9% (Q2 2018/19: up 6.3%), and total revenue rose by 0.4% to £8.83bn (2018/19: £8.80bn).

Profit before tax and exceptionals was up 5.3% to £198m (2018/19: £188m), and EPS before exceptionals rose by 4.1% to 6.38p (2018/19: 6.13p).

During the period, statutory profit before tax increased by 48.5% to £202m (2018/19: £136m).

Morrisons store on Amazon Prime Now is expanding to many more cities across the UK, starting in Q3. Also, the trial conversion of ten McColl’s stores to Morrisons Daily has started well.

Today the company is announcing four new or extended wholesale supply initiatives:
> Multi-year partnership signed with Amazon extending relationship in time and scope
> New forecourt partner Harvest Energy
> New export partner LuLu in the Middle East
> Further convenience store trial formats with Rontec

For financial targets, the group is on track for £1bn annualised wholesale supply sales target. A further £7m incremental profit from wholesale, services, interest and online, taking the total so far to £61m. The group is on track for its £75m–£125m target.

Andrew Higginson, Chairman, 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

David Potts, Chief Executive, said, “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. Sales and profit progress was robust, and we again invested in improving our competitiveness for customers.

“News today of new wholesale initiatives, including a further extension of our partnership with Amazon, and of another special dividend, again show how new Morrisons continues to become broader and stronger for all stakeholders, and how progress can be meaningful and sustainable even in more testing trading conditions. Such progress is only made possible by Morrisons exceptional team of food makers and shopkeepers.”