Morrisons profits hit £935m

 

The UK's fourth biggest supermarket Morrisons boasted success in a
price war with its rivals today as it reported a better-than-expected
rise in annual profits.

Morrisons chief executive Dalton Philips said its budget M Savers range had received a strong response and the supermarket offered "promotions that customers understood".

Tesco sparked a battle with its competitors last September when it unveiled the Big Price Drop campaign, prompting Sainsbury's, Asda and Morrisons to follow suit.

Morrisons, which has 455 stores in the UK, recorded an 8% rise in underlying pre-tax profits to £935 million in the year to January 29, as like-for-like sales excluding fuel and VAT rose by 1.8%. The City had been expecting profits of around £922 million.

The group pledged to roll out smaller convenience formats throughout 2012 after the successful trial of three stores last year, but there was still no movement on plans to sell online, which are not expected to be revealed until the end of the current financial year, which is in January.

Morrisons has been appealing to shoppers by giving away money-off vouchers for petrol while its Price Crunch discounting initiatives and new range of ready meals are advertised by former England cricketer Andrew Flintoff.

Despite the surge in profits, Morrisons has seen slowing growth in recent months with strong like-for-like sales growth in the first three quarters of its financial year fading to 0.7% in the six weeks to January 1.

Figures from Kantar Worldpanel showed the Bradford-based company's market share fell slightly to 12.2% in the 12 weeks to February 19.

Looking ahead, Mr Philips, who took over when Marc Bolland joined Marks & Spencer, said: "We know that 2012 will be tough, and we will be working hard to deliver even better value for our customers."

The group plans to spend around £1.7 million per store on revamping the supermarket's fresh food offering, after a successful trial in 12 stores in the UK.

The grocer said its store-opening plans were on track with 700,000 sq ft of space set to be opened in the current financial year, compared with 643,000 sq ft in the last year, or 37 new stores.

This will include new convenience formats - M Local - which have an average size of around 8,000 sq ft.

Morrisons has also bought stores from electronics retailer BestBuy's failed UK venture, which it will use as superstores for its Kiddicare brand, which mainly trades on the internet.

Nick Bubb, independent retail analyst, said the final results are "a bit better than expected".

He said: "The basic message is that, thanks to productivity work, profits this year will not be unduly held back by the roll-out plan for the new convenience store chain and the big expansion of Kiddicare."

PA

Start your day with The Independent, sign up for daily news emails
PROMOTED VIDEO
ebooks
ebooksA special investigation by Andy McSmith
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Compliance Assistant

£13000 per annum: Recruitment Genius: This Pension Specialist was established ...

Ashdown Group: Market Research Executive

£23000 - £26000 per annum + Benefits: Ashdown Group: Market Research Executive...

Recruitment Genius: Technical Report Writer

£25000 - £35000 per annum: Recruitment Genius: A Technical Report Writer is re...

MBDA UK Ltd: Indirect Procurement Category Manager

Competitive salary & benefits!: MBDA UK Ltd: MBDA UK LTD Indirect Procurement...

Day In a Page

Isis hostage crisis: The prisoner swap has only one purpose for the militants - recognition its Islamic State exists and that foreign nations acknowledge its power

Isis hostage crisis

The prisoner swap has only one purpose for the militants - recognition its Islamic State exists and that foreign nations acknowledge its power, says Robert Fisk
Missing salvage expert who found $50m of sunken treasure before disappearing, tracked down at last

The runaway buccaneers and the ship full of gold

Salvage expert Tommy Thompson found sunken treasure worth millions. Then he vanished... until now
Homeless Veterans appeal: ‘If you’re hard on the world you are hard on yourself’

Homeless Veterans appeal: ‘If you’re hard on the world you are hard on yourself’

Maverick artist Grayson Perry backs our campaign
Assisted Dying Bill: I want to be able to decide about my own death - I want to have control of my life

Assisted Dying Bill: 'I want control of my life'

This week the Assisted Dying Bill is debated in the Lords. Virginia Ironside, who has already made plans for her own self-deliverance, argues that it's time we allowed people a humane, compassionate death
Move over, kale - cabbage is the new rising star

Cabbage is king again

Sophie Morris banishes thoughts of soggy school dinners and turns over a new leaf
11 best winter skin treats

Give your moisturiser a helping hand: 11 best winter skin treats

Get an extra boost of nourishment from one of these hard-working products
Paul Scholes column: The more Jose Mourinho attempts to influence match officials, the more they are likely to ignore him

Paul Scholes column

The more Jose Mourinho attempts to influence match officials, the more they are likely to ignore him
Frank Warren column: No cigar, but pots of money: here come the Cubans

Frank Warren's Ringside

No cigar, but pots of money: here come the Cubans
Isis hostage crisis: Militant group stands strong as its numerous enemies fail to find a common plan to defeat it

Isis stands strong as its numerous enemies fail to find a common plan to defeat it

The jihadis are being squeezed militarily and economically, but there is no sign of an implosion, says Patrick Cockburn
Virtual reality thrusts viewers into the frontline of global events - and puts film-goers at the heart of the action

Virtual reality: Seeing is believing

Virtual reality thrusts viewers into the frontline of global events - and puts film-goers at the heart of the action
Homeless Veterans appeal: MP says Coalition ‘not doing enough’

Homeless Veterans appeal

MP says Coalition ‘not doing enough’ to help
Larry David, Steve Coogan and other comedians share stories of depression in new documentary

Comedians share stories of depression

The director of the new documentary, Kevin Pollak, tells Jessica Barrett how he got them to talk
Has The Archers lost the plot with it's spicy storylines?

Has The Archers lost the plot?

A growing number of listeners are voicing their discontent over the rural soap's spicy storylines; so loudly that even the BBC's director-general seems worried, says Simon Kelner
English Heritage adds 14 post-war office buildings to its protected lists

14 office buildings added to protected lists

Christopher Beanland explores the underrated appeal of these palaces of pen-pushing
Human skull discovery in Israel proves humans lived side-by-side with Neanderthals

Human skull discovery in Israel proves humans lived side-by-side with Neanderthals

Scientists unearthed the cranial fragments from Manot Cave in West Galilee