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500,000 new customers weekly for Morrisons

Supermarket Morrisons today said it attracted half a million more new customers each week to its stores in the first quarter as like-for-like sales rose 7.3 per cent.

The group kept up the pressure on rivals with heavy discounting, offering 8,000 price cuts under the group's "Price Crunch" campaign.

Morrisons' sales hike in the 13 weeks to May 3, which excludes fuel but includes VAT, was broadly in line with the 7.9 per cent hike in annual sales reported in March, despite easing food price inflation.

Morrisons said with VAT excluded, first quarter sales rose 8.2 per cent - matching the 8.2 per cent seen over the year to February 1.

The UK's fourth largest supermarket said it was stealing further market share from rivals, with good growth in traditionally weaker areas for Morrisons, such as London, the South and Scotland.

The most recent data from TNS Worldpanel showed Morrisons enjoyed the greatest level of annual growth in the four weeks to May, chipping away further at Tesco's dominance.

Marc Bolland, chief executive of Morrisons, said today's sales figures were a "particularly good result" against last year's strong comparative result, when sales rose 7 per cent.

He added the group was taking its next step from "national to nationwide" as it ploughs on with expansion plans.

Morrisons aims to expand by around 350,000 square feet of new retail space over the year ahead - on top of the 500,000 square feet it has already agreed to acquire from the Co-operative Group.

The group is opening two of its acquired stores this month after refurbishment, in Kingsbridge in Devon and Shefford in Bedfordshire.

Shares in the group rose 2 per cent after the first quarter update, with the sales figure coming in higher than most analysts were expecting.

Mike Tattersall, an analyst at Cazenove, said it was "clearly a highly creditable performance".

But he said the supermarket faced tougher comparatives going forward, given last year's strong quarterly sales increases.