Veteran Morrisons founder hits out at the board: 'Your strategy is a load of bull'

Struggling chain must go back to basics, he says, as CEO is humiliated

Sir Ken Morrison and members of his family yesterday launched a sustained attack on the board of the struggling supermarket they once controlled and ran, in astonishing scenes at the company's shareholder meeting.

He attempted to humiliate chief executive Dalton Philips in front of hundreds of shareholders at the company's Bradford offices, calling the boss's strategy "bulls***" and hinting that he wanted the entire board to resign.

His nephew, Chris Blundell, who controls most of the remaining family stake in the supermarket, also told the board it needed rescuing, and welcomed the decision by chairman Sir Ian Gibson to leave the business next year after months of pressure.

Yorkshireman Sir Ken said: "When I left work and started working as a hobby, I chose to raise cattle. I have something like 1,000 bullocks and, having listened to your presentation, Dalton, you've got a lot more bullshit than me.

"The results were described by the chairman and chief executive as 'disappointing'. I personally thought they were disastrous. I warned in 2009 and 2012 that changes being implemented by directors would seriously damage the business and I'm extremely sorry to admit that my comments, whilst unwelcome, were absolutely right and today we have seen the consequences."

The 82-year-old, who built the business from a small family concern into the UK's fourth-largest chain over 50 years before stepping down in 2008, has hit out at the current management before but most observers agreed yesterday was his harshest critique.

After the meeting he refused to back Mr Philips and the board, arguing that the company must go "back to basics".

Morrisons suffered a £176m loss last year, and in March unveiled £1bn in price cuts in a bid to claw back customers amid diving sales.

Sir Ken was joined in his attack on management by Mr Blundell, who used to work for Morrisons too.

He said: "I think we're in a rescue situation here and it needs urgent action. Things need to be done very quickly. We are losing our reputation. A reputation is everything in business and I think you've lost that to a great extent."

A clearly shaken chairman Sir Ian said the strategy was the right one and would soon show results.

He added: "To say we are in a rescue situation – I'm sorry that's nothing but wrong. It is a very sound business and in the process of still growing."

The meeting started sombrely with both chairman and chief executive apologising for the poor performance over the last 12 months, which has seen 40 per cent wiped from the share price.

The company has been losing out to discounters Aldi and Lidl and to its traditional rivals Sainsbury's, Tesco and Asda due to its lack of online business or convenience stores, which they have recently launched.

However, after the meeting Mr Philips and Sir Ian attempted to play down the attacks, pointing out that they had both been re-elected by the vast majority of shareholders, including all top 20 institutional investors. Mr Philips said: "There is a well-documented difference on strategy between Ken and myself and I don't want to get drawn into a tit-for-tat exchange. My job is to deliver our strategy outlined to shareholders."

Sir Ian said he had not been put under any pressure to resign and that he was stepping down after eight years to avoid any further speculation.

He added: "I had to go within the next two years [under stock market rules] and this was the perfect opportunity. This was a debate with me and my board."

Mr Philips is cutting prices to the tune of £1bn over three years in the face of the exodus of shoppers to discounters like Aldi and Lidl. He has previously countered Sir Ken's criticisms of his management by pointing out that when he arrived, parts of the supermarkets group were 20 years behind the times, with cash being counted by hand in shops at the end of the day and stocktaking done with pen and paper.

The chairman's departure was seen as taking some of the heat from Mr Philips. Some in the industry are predicting the company could soon fall prey to a private equity takeover.

Analysis: 'Like shooting fish'

Attacking the current Morrisons' board in front of long-term shareholders, at the supermarket groups's AGM yesterday in Bradford, was, for founder Sir Ken Morrison, like shooting fish in a barrel.

However, despite poor sales figures, institutional investors are looking to CEO Dalton Philips to turn Morrisons' poor fortunes around.

In the wake of ally Sir Ian Gibson's departure, the onus is on Mr Philips to make significant improvements over the next year, before a replacement arrives.

Simon Neville

Start your day with The Independent, sign up for daily news emails
Sport
sportSo, how closely were you paying attention during 2014?
Arts and Entertainment
Dennis speaks to his French teacher
tvThe Boy in the Dress, TV review
News
One father who couldn't get One Direction tickets for his daughters phoned in a fake bomb threat and served eight months in a federal prison
people... (and one very unlucky giraffe)
Arts and Entertainment
Joel Edgerton, John Turturro and Christian Bale in Exodus: Gods and Kings
film
PROMOTED VIDEO
ebooks
ebooksA year of political gossip, levity and intrigue from the sharpest pen in Westminster
News
i100
Arts and Entertainment
The Plaza Theatre in Atlanta, Georgia was one of the 300 US cinemas screening
filmTim Walker settles down to watch the controversial gross-out satire
Arts and Entertainment
Amy Adams and Christoph Waltz in Tim Burton's Big Eyes
film reviewThis is Tim Burton’s most intimate and subtle film for a decade
Life and Style
Mark's crab tarts are just the right size
food + drinkMark Hix cooks up some snacks that pack a punch
Arts and Entertainment
Jack O'Connell stars as Louis Zamperini in Angelina Jolie's Unbroken
film review... even if Jack O'Connell is excellent
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

Selby Jennings: VP/SVP Credit Quant- NY- Investment Bank

Not specified: Selby Jennings: VP/SVP Credit Quant Top tier investment bank i...

Selby Jennings: Quantitative Research | Equity | New York

Not specified: Selby Jennings: Quantitative Research | Global Equity | New Yor...

Selby Jennings: SVP Model Validation

Not specified: Selby Jennings: SVP Model Validation This top tiered investment...

Selby Jennings: Oil Operations

Highly Competitive: Selby Jennings: Our client, a leading European Oil trading...

Day In a Page

Aren’t you glad you didn’t say that? The worst wince-and-look-away quotes of the year

Aren’t you glad you didn’t say that?

The worst wince-and-look-away quotes of the year
Hollande's vanity project is on a high-speed track to the middle of nowhere

Vanity project on a high-speed track to nowhere

France’s TGV network has become mired in controversy
Sports Quiz of the Year

Sports Quiz of the Year

So, how closely were you paying attention during 2014?
Alexander Armstrong on insulting Mary Berry, his love of 'Bargain Hunt', and life as a llama farmer

Alexander Armstrong on insulting Mary Berry and his love of 'Bargain Hunt'

From Armstrong and Miller to Pointless
Sanchez helps Gunners hold on after Giroud's moment of madness

Sanchez helps Gunners hold on

Olivier Giroud's moment of madness nearly costs them
A Christmas without hope: Fears grow in Gaza that the conflict with Israel will soon reignite

Christmas without hope

Gaza fears grow that conflict with Israel will soon reignite
After 150 years, you can finally visit the grisliest museum in the country

The 'Black Museum'

After 150 years, you can finally visit Britain's grisliest museum
No ho-ho-hos with Nick Frost's badass Santa

No ho-ho-hos with Nick Frost's badass Santa

Doctor Who Christmas Special TV review
Chilly Christmas: Swimmers take festive dip for charity

Chilly Christmas

Swimmers dive into freezing British waters for charity
Veterans' hostel 'overwhelmed by kindness' for festive dinner

Homeless Veterans appeal

In 2010, Sgt Gary Jamieson stepped on an IED in Afghanistan and lost his legs and an arm. He reveals what, and who, helped him to make a remarkable recovery
Isis in Iraq: Yazidi girls killing themselves to escape rape and imprisonment by militants

'Jilan killed herself in the bathroom. She cut her wrists and hanged herself'

Yazidi girls killing themselves to escape rape and imprisonment
Ed Balls interview: 'If I think about the deficit when I'm playing the piano, it all goes wrong'

Ed Balls interview

'If I think about the deficit when I'm playing the piano, it all goes wrong'
He's behind you, dude!

US stars in UK panto

From David Hasselhoff to Jerry Hall
Grace Dent's Christmas Quiz: What are you – a festive curmudgeon or top of the tree?

Grace Dent's Christmas Quiz

What are you – a festive curmudgeon or top of the tree?
Nasa planning to build cloud cities in airships above Venus

Nasa planning to build cloud cities in airships above Venus

Planet’s surface is inhospitable to humans but 30 miles above it is almost perfect