Sales grow at Morrisons
WM Morrison yesterday unveiled strong third quarter sales, a day after the City and investors were left reeling from the shock departure of its chief executive Marc Bolland.
The group said like-for-like sales rose 4.3 per cent in the 13 weeks to 1 November, just below expectations, as slowing food inflation pegged back growth from 7.8 per cent in the first half.
Finance director Richard Pennycook, who handled press briefings without boss Bolland, said the retailer was pulling in 10.8m customers a week, an extra 1.6m shoppers compared to two years ago.
Unlike rivals including Tesco, Asda and Sainsbury’s, Morrisons has chosen not to diversify into online sales or clothing but has instead focused on its “market street” concept – which is based on the appeal of having on-site bakers, butchers and fishmongers.
Pennycook said there were signs consumers were reverting to more normal spending patterns after switching to cheaper products earlier in the year.
But he said sales of the supermarket’s value range were still growing in double digits compared with single digit gains for its premium ranges.
The supermarket’s shares closed unchanged at 281p after a five per cent fall on Wednesday caused by news that Bolland would leave the firm after three years at the helm to switch to general retailer Marks & Spencer.
HOW WILL MORRISONS FARE WITH THE LOSS OF MARC BOLLAND?
INTERVIEWS BY HEATH ASTON
SAM HART CHARLES STANLEY
Losing Marc Bolland is undoubtedly a blow but Morrisons is a strong company and we believe it will remain at the upper end of like-for-like sales growth compared to its rivals. Bolland has put in place the bedrock of the restructure. Whoever takes the reins is likely to build on his work and focus on things like supply chain improvements rather than any major strategy overhaul.
RICHARD HUNTER HARGREAVES LANSDOWN
The incoming person will inherit a steady ship. The company’s fortunes are markedly improved since the debacle of the Safeway integration and the numerous profit warnings. Morrisons has had a particularly robust year and even though this statement shows slightly slowing growth, much of this is due to falling food inflation, which of course has affected the entire industry.
DAVID BUIK BGC PARTNERS
Richard Pennycook, the finance director looks like the most likely successor to me. He has been at Morrisons as finance director longer than Bolland and has worked closely with him for the past three years. He knows every nook and cranny in the Morrisons emporium. He will surely have been groomed by Sir Ken Morrison and Marc Bolland as the Prince Regent.