Morrisons today (9 January) reported a near-6% drop in like-for-like sales over Christmas, sending shares in the UK’s fourth-largest grocer sliding.
The company said its like-for-like sales fell 5.6% excluding fuel in the six weeks to 5 January. Total sales excluding fuel decreased 1.9%.
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Morrisons expects its annual underlying profits to be “towards the bottom end” of current market expectations. City forecasts for Morrisons’ underlying operating profit range from GBP783m (US$1.29bn) to GBP853m.
Morrisons said “hard-pressed” consumers were “buying less and shopping selectively across a range of formats and retailers”.
It claimed the “accelerating importance” of the convenience and online channels – where the retailer has lagged its rivals – and “targeted couponing” by competitors “intensified” what it called “difficult market conditions”.
The retailer’s like-for-like sales have fallen in each of the first three quarters in its current financial year.
Morrisons is building its presence in the convenience sector and online. It has 85 c-stores and wants 200 by the end of its 2014/15 fiscal year. The retailer will make its first home deliveries through its venture with Ocado tomorrow.
Shares in Morrisons were down 6.41% at 237.9p at 11:20 GMT.
Click here for a round-up of what retail analysts thought about Morrisons’ results.
