Morrisons has today updated investors on trading for the first quarter - the 13 weeks ending 29th January 2023 - reporting improving sales momentum, positive like-for-like sales, stabilised market share and increasing competitiveness.
Morrisons also reached the milestone of 500 Morrisons Daily convenience stores this week with the opening of the Phoebe Street store in Salford. Morrisons has franchise partnerships with Rontec, Harvest Energy, Highland Fuels, independents, Sandpiper in the Channel Islands, as well as its own wholly owned convenience business, McColl’s, which was acquired in May 2022. There are now 350 former McColl’s stores trading as Morrisons Daily with around 10 new conversions every week.
Q1 Key points
- Total revenue up 3.4% to £4,713m
- Group like-for-like (LFL) sales ex-fuel/ex-VAT up 0.1%, reflecting steady improvement over the last three trading quarters
- Further significant price cutting programmes to help customers through the cost of living crisis
- Continued investment and focus on My Morrisons loyalty scheme leading to greater customer engagement
- Three year £700 million cost savings programme underway to enable further investment in lowering prices, increasing service levels, investing in loyalty and expanding the convenience footprint
| Q1 2022/23 | Q1 2021/22 | |
| Revenue inc-fuel | £ 4,713 m | £ 4,558 m |
| Group LFL ex-fuel (%) | 0.1% | (5.0)% |
| Group LFL inc-fuel (%) | 2.1% | 1.3% |
| Q1 LY | Q2 LY | Q3 LY | Q4 LY | Q1 2022/23 | |
| Group LFL ex-fuel | (5.0)% | (6.4)% | (3.1)% | (2.0)% | 0.1% |
| Group LFL inc-fuel | 1.3% | 2.5% | 4.3% | 0.3% | 2.1% |
On the Q1 trading, Chief Executive Officer, David Potts said:
“We still have plenty of work to do, but momentum in the business is now building with an improving trajectory over the last three quarters and like-for-like sales now in positive territory. Our market share has stabilised, our inflation rate is below our peers, and Morrisons traditional competitiveness, colour and dynamism is steadily returning to every part of the business.
“We have targeted £700 million of cost savings over the next three years. This saving will help drive the performance of the business by enabling further investment in our loyalty programme, increasing the pace of McColl’s conversions, putting more hours into our stores, as well as mitigating the significant cost headwinds that we face.
“Although this has been another difficult period for consumers with inflation still at very high levels, we have continued with our programme of regular and meaningful price investments, enabled by a strong start to our cost savings programme.
“The cornerstone of the improving picture at Morrisons has been our colleagues. Across the whole business, they have continued to help our customers by providing a colourful, vibrant, fresh food focused shopping experience and I want to thank everyone at Morrisons for their continued hard work and positivity.”
On the opening of the 500th Morrisons Daily convenience store David Potts said:
“This is an important milestone for us and cements a leading position in the UK’s growing convenience market. Whether it’s a franchise store or a former McColl’s store, customers are responding really well to the carefully tailored Morrisons Daily fresh food convenience offer, and clearly appreciate our great value and our bright, modern store designs. With every new Morrisons Daily conversion, we see an immediate and substantial uplift in like-for-like sales, often of more than 20%.
“We expect to reach 750 Morrisons Daily stores in the autumn and the 1,000 store mark early next year.”