Morrisons goes South
NORTHERN supermarket chain Morrisons said it was to continue its march southwards after revealing a 7% hike in full-year pre-tax profits to £655m.
The Bradford-based group, which first signalled its intention to move out of its heartland with the £3bn purchase of Safeway in 2004, has acquired 500,000sq ft from the Co-Operative group as it sheds space under competition rules following the acquisition of Somerfield.
This morning, Morrisons’ chief executive Marc Bolland said it intended to extend its footprint in London and the South.
The UK’s fourth biggest supermarket business announced it would share out a £34m bonus between its 124,000 staff - up 13% on the previous year - after the profits improvement.
Morrisons saw like-for-like sales, excluding fuel, increase 7.9% over the year to February 1, after attracting 550,000 more customers through its tills each week.
It confirmed plans for around 350,000 sq ft of new retail space on top of the Co-Op shop space, putting it within “a 15-minute drive” of every shopper, said Mr Bolland.
Morrisons has been stealing market share from rivals over the past year. Latest data from TNS Worldpanel showed Morrisons swelled its share from 11.6% to 11.8% in the 12 weeks to February 22. And it left competitors trailing with an impressive 8.2% rise in comparable sales over Christmas.
The company has re-launched cheaper lines, slashed prices and improved promotions, including Sunday lunch for four for £4.
But Mr Bolland also told shareholders the company was scrapping further share buybacks in order to put cash back into the business for investment and expansion.
It has returned £146m to shareholders so far under an original £1 billion buyback.
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