Morrisons profits rise despite first like-for-like fall since 2016

Like-for-likes dropped 1.9% when fuel and VAT was stripped out.

Total sales edged up 0.4% to £8.83bn in the six months to August 4.

Morrisons said it faced strong sales comparisons as last year it was helped by good weather in the summer and events such as the World Cup and royal events. It pointed out there were no events, and the weather was “largely unfavourable”, this summer.

However, the supermarket also highlighted that consumer confidence was weak and impacted customer behaviour.

Morrisons chief executive David Potts 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.”

Amazon extension and wholesale growth

The supermarket is ramping up its wholesale initiatives.

The grocer revealed it had expanded the scope of its partnership with Amazon Now to more cities across the UK.

It has also signed a new forecourt partner in Harvest Energy, a new export partner, LuLu in the Middle East, and is carrying out further convenience store trial formats with UK forecourt specialist Rontec.

Morrisons is on track to make £1bn annualised wholesale supply sales and to hit its medium-term target of achieving between £75m and £125m in incremental profit from wholesale, services, interest and online.

Morrisons chief executive David Potts said: “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.”

It has also started a trial to convert 10 McColl’s stores to the Morrisons Daily fascia.

Morrisons 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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