https://www.linkedin.com/in/brian-moore-038b8112/recent-activity/all/
CEO Rami Baitiéh’s turnaround programme at Morrisons appears to be picking up speed after the group delivered its strongest quarter since the start of 2021.
Over the 13 weeks to 27 October, the grocery retailer’s like-for-like sales increased by 4.9%, with total revenues up 4.8% to £3.8bn. The robust fourth-quarter figures meant that annual like-for-likes had grown 4.1% – a marked improvement on the 1.8% rise the previous year.
Full-year underlying EBITDA was up 11.2% to £835m on revenue that increased 3.8% to £15.3bn.
Morrisons noted that it had made good progress in improving product availability, with it up four percentage points on fresh goods. Its revamped More Card loyalty scheme also saw linked sales grow to 68% at the year end (76% today), whilst its discounter Price Match initiative now covers over 500 everyday items.
Morrisons also highlighted progress on tackling the large debt burden left over from the takeover by CD&R. The group’s debt is now down 40% from its peak, with CFO Jo Goff saying: “A year of broad-based operational progress has helped to deliver a significantly strengthened Morrisons.
We delivered a further £150m of progress on our working capital programme in the year, taking the total since the start of the programme to £450m, and have achieved £312m in our cost-saving programme in the year.”
Other highlights of the Morrisons year included the sale of its petrol forecourts to MFG for £2.5bn and the acquisition of 36 convenience stores in the Channel Islands.
The group’s convenience store estate now stands at over 1,600 stores after rapid growth in recent years.
“This has been a year of urgent reinvigoration and positive progress for Morrisons. Customer transactions increased, market share grew from Q2, and we saw positive switching from our competitors,” said Baitiéh.
He noted that improvements across the business had resulted in “better availability in our stores, sharper prices, more effective promotions and a strong and growing loyalty scheme”, which was now starting to be reflected in its financial performance.
Baitiéh concluded: “I want to thank everyone at Morrisons for their commitment and energy every day and for playing their part in the significantly improved performance that we are reporting today.
Supermarkets, Convenience, Online, Wholesale and Myton Food Group all contributed to the improving picture, helping us serve our customers better.”
Morrisons did not reveal how it traded over the key Christmas period. However, Kantar data released earlier this month suggested the chain lagged well behind Tesco and Sainsbury’s.
NamNews Implications:
* Latest stats looking good
* Lowering the debt burden means reduced pressure on debt servicing..
* Perhaps time for suppliers to join with Morrisons new found optimism?
* (despite a probable Christmas lag vs Rivals?)
MorrisonsRethink
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