Morrisons is to crank up its expansion programme into the South of England over the next three years after posting a 21 per cent rise in underlying profits for the past year.
The Bradford-based grocer is looking to open a further 60 stores over the next three years, which is a significant uplift given that the net 57 shops it opened between 2007 and 2010 included 34 acquired from its rival Co-operative Group in 2009.
Richard Pennycook, the finance director at Morrisons, said: "Our space ambitions for the future lay more in the South than elsewhere because that is where our strongest under-representation is in the country."
Including store extensions, the UK's fourth-biggest grocer will open 1.5 million sq ft of new selling space in the period to the end of January 2013, compared with 1.4 million over the previous three years.
Mr Pennycook pointed out that the 425-store grocer has identified locations for a further 175 stores – sized between 10,000 sq ft and 40,000 sq ft – that would enable 7 million more households access to its shops within a 15-minute drive.
For the year to 31 January 2010, Morrisons delivered a 21 per cent jump in underlying profits, excluding pension costs, interest and credit, and property disposals, to £767m. Mr Pennycook said: "2009 was a vintage year for Morrisons. We strongly outgrew the market for the second successive year."
The expansion plans and spike in profits means that Dalton Philips (pictured), the incoming chief executive, who joins on 29 March, joins a grocer in rude health. Its previous chief executive, Marc Bolland, will take the helm at Marks & Spencer on 1 May.
Total sales at Morrisons jumped by 6 per cent over the year to £15.4bn, driven by strong underlying sales and a 7 per cent jump in new customers to an average of 10.5 million a week. Its like-for-like sales, excluding both fuel and VAT, jumped by 6 per cent.
Sir Ian Gibson, the chairman of Morrisons, said Mr Dalton – who was most recently the chief operating officer of the Canadian retailer Loblaw – would bring a wealth of retail experience to the grocer and "almost certainly a new perspective". He added: "He has worked small stores and big stores, a multiple offer and a straight fresh food offer in different parts of the world. He has taken things in a different direction."
However, he denied that Mr Dalton's experience in non-food signalled a push by Morrisons into that arena, and reiterated that it still had plenty of new space and opportunities to go for under its slogan, the "fresh food specialist for everyone".
Morrisons grew its pre-tax profits by 31 per cent to £858m. Its total dividend for the year has been raised by 41 per cent to 8.2p.Reuse content