Second quarter of growth
Morrisons ‘making progress’ as sales rise
Chief executive David Potts said the group was making progress, although there was still much to do.
Total sales excluding fuel were down 1.8% (down 0.9% including fuel), reflecting the impact of supermarket closures and exit of the M local chain.
Online contributed 1% to LFL during the period. Fuel LFL was positive despite deflation of almost 11%.
Morrisons said it continues to simplify and speed up the business, and is making improvements to the shopping trip which are proving popular with Morrisons customers.
LFL transactions were up 3.1% in the quarter and LFL volume growth was again strong.
Transaction growth was in part driven by a significant increase in sales of Food to Go (up over 17% year-on-year) following the launch of many new and improved products.
The new self-scan and express checkouts continue to help customers shop more often and queue less. These factors also continue to impact items per basket (down 2.8%).
The Free From range has started well with sales up by more than 70% year-on-year during the quarter.
Morrisons said its fiancial position is strong and it remains committed to a net debt target of £1.4bn to £1.5bn by the year end.
Mr Potts said: “We are encouraged by progress across our six priorities. There is still much to do and our colleagues are working very hard to improve the shopping trip and save customers every penny we can.
“Customers are responding and satisfaction levels remain ahead of last year. We are of course pleased with a second consecutive quarter of positive LFL sales, which demonstrates our aim to stabilise trade is taking effect.”
The board said: “We will continue to invest in improving the shopping trip for customers. We expect continued deflation and sustained improvement in customer satisfaction. Growing LFL volume remains a key priority for every member of the Morrisons team.”