Morrisons share price slides as it warns on profit

 
Kasmira Jefford
Follow Kasmira
WM MORRISON boss Dalton Philips said it missed out on the usual seasonal surge in footfall over Christmas because of competition from discounters and the lack of an online presence, as the supermarket chain was forced to issue a profit warning.

The UK’s fourth largest grocer brought forward its trading update by 11 days to deliver a worse-than-expected fall in like-for-like sales, which were down 5.6 per cent in the six weeks to 5 January.

It warned that full-year profits would now be “towards the bottom of the range of current market expectations”, which stand at £783m to £853m.

Morrisons has been hampered by its late entry into online and its fledgling convenience stores network – the two fastest growth areas for grocers.

It currently has just 85 convenience stores and plans to have 200 by the end of 2014-15 while its online business will launch in Warwickshire today.

“These channels are significant and this Christmas like no other Christmas people migrated online to buy their Christmas fare,” Philips said.

It has also been under pressure from discounters which have a strong presence in its northern heartland and have stepped up their efforts to win customers loyalty this Christmas.

“In December we usually saw people migrate [from discounters] to our shops and this year this didn’t materialise as expected,” Philips said.

Its shares fell 7.75 per cent.

Related articles