Business

Wm Morrison Supermarkets reports 13th consecutive quarter of declining sales

New chief executive gives few clues as to how to revive business

Morrison chief executive David Potts is undertaking a full review of the business Photograph: PA Undated handout photo issued by Morrisons of David Potts who rose through the ranks of Tesco after starting his career as a shelf stacker and is now to take charge of rival chain Morrisons. PRESS ASSOCIATION Photo. Issue date: Wednesday February 25, 2015. Potts will be the “fresh pair of eyes” called for by the Bradford-based business when it ousted former chief executive Dalton Philips last month. The appointment reunites Mr Potts with former Tesco senior executive Andrew Higginson, who is now chairman of the UK’s fourth largest grocer. See PA story CITY Morrisons. Photo credit should read: Morrisons./PA WireNOTE TO EDITORS: This handout photo may only be used in for editorial reporting purposes for the contemporaneous illustration of events, things or the people in the image or facts mentioned in the caption. Reuse of the picture may require further permission from the copyright holder.

Thu May 7 2015 - 15:53

Wm Morrison Supermarkets' new chief executive David Potts gave few indications pm Thursday of how he plans to revive the struggling UK grocer after revealing a 13th consecutive quarter of declining same-store sales.

Mr Potts, who started in the job seven weeks ago, spoke of improving service, availability and in-store cleanliness, though left questions unanswered on the possibility of further price cutting and whether more stores will need to close.

"Dave Potts doesn't have much to say for himself," said Nick Bubb, an independent retail analyst in London. "The guidance, although cryptic, sounds downbeat."

Morrison has been one of the biggest losers from a price war among British supermarkets, posting two years of losses as a £1 billion price-cutting programme failed to revive sales.

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Former Tesco executive Mr Potts is undertaking a full review of the business and promised to provide a more detailed update at the time of September's first-half results announcement.

“We aim to be a simpler, leaner and cost-conscious business that acts at speed wherever possible,” Mr Potts said on a conference call onThursday, also announcing the appointment of a new commercial director.

“We’ve been listening hard to find ways to improve the shopping trip for customers.”

His words failed to inspire the shares, which fell in London.

Morrison said it expects underlying pretax profit to be higher in the second half of the financial year than the first.

The grocer also reported little change in sales patterns during the last quarter as declines persisted in the face of discount-led competition. Sales at stores open at least a year fell 2.9 per cent, excluding fuel, in the 13 weeks ended May 3rd. That compares with the prior quarter’s 2.6 per cent drop and the median estimate of 13 analysts for a 2.8 per cent decline.

Bloomberg

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