It was a very merry Christmas for Morrisons with sales up 2.9 per cent
Morrisons today revealed that sales in the nine weeks to 1 January were the strongest the supermarket has seen for seven years – and it's raised its expectations for full year profits.
The group's shares jumped 4.5 per cent at the open.
The group reported a 2.9 per cent jump in like-for-like sales excluding fuel – with fuel included, sales went up 4.7 per cent. Total sales also went up, by two per cent excluding fuel.
The company said Morrisons.com achieved its biggest ever week for sales during the nine-week period.
As a result of these numbers, Morrisons said it now expects underlying profit before tax to come in ahead of the previous £326m consensus – profit is predicted to be between £330m and £340m.
In November, analysts hailed the supermarket's resilience in a tough market environment as the group reported a full year of quarterly sales growth, a trend that's continued since.
Improved offer
Morrisons attributed the strong festive performance to "improving (its) offer, becoming more competitive, and serving customers better".
"Our performance shows that when we improve the shopping trip, customers respond," the group said in a trading update this morning.
In addition, the supermarket highlighted its new automated ordering system which has been introduced into all stores in grocery and many fresh categories, the first of its kind for Morrisons. The firm said the system, which is capital light, is "simpler and saves time for colleagues, availability has improved significantly, and stock levels are down".
"This Christmas we made further improvements to the customer shopping trip," said chief executive David Potts.
"We stocked more of what our customers wanted to buy, more tills were open more often, and product availability improved as over half of sales went through our new ordering system. Both like-for-like and total sales grew, which was very encouraging.
"Eighteen months ago I said that this would be a colleague-led turnaround, and our improving performance is entirely due to the continuing hard work of the Morrisons team of food makers and shopkeepers. I would like to thank all colleagues for making Christmas and New Year extra special for our customers."
News of Morrisons' successful Christmas comes as the supermarket sector faces new challenges – City A.M. today revealed that supplier Premier Foods, the company behind household brands such as Mr Kipling and Bisto, is in talks with shops about hiking prices due to the weakened pound and higher commodity costs.