Morrisons posts sales growth but warns of higher Covid-19 costs
Morrisons has reported a rise in sales during the second half of the year, but warned that tougher new Covid-19 lockdown measures would increase its costs.
The supermarket chain posted an 8.1 per cent rise in like-for-like sales excluding fuel in the 22 weeks to the 3 January.
Including fuel, like-for-like sales rose 1.9 per cent as the second national lockdown and tougher tier systems continued to impact travel.
Morrisons said sales ticked up at the start of the lockdown in November, before rising further over Christmas and New Year. Like-for-like sales were up 9.3 per cent over the festive period.
The supermarket said consumer behaviour had shifted in the run-up to Christmas as a result of the pandemic, with shoppers stocking up earlier and spending more on traditional festive food.
Champagne sales fizzed 64 per cent compared to last year, whole salmon leapt 40 per cent and mince pies were up 14 per cent.
But Morrisons warned that Covid-related costs would be higher than previously expected as a result of tougher new lockdown measures.
In addition to the £40m costs announced last month, the company said it would need to spend roughly £10m to cover costs such as additional staff absences.
This will take the total Covid-related costs for the year to £280m.
Nevertheless Morrisons maintained its full-year profit forecast of between £420m and £440m. This is excluding £230m of business rates relief, which the supermarket has said it will return to the government.
“The pandemic has had a severe effect on people and communities around Britain for nine months now but it has been especially hard at Christmas time,” said chief executive David Potts.
“I’m very pleased with the way the Morrisons team has helped our customers across the nation enjoy their Christmas in the best way they could — with safe shopping, great service and outstanding stores even in the most difficult circumstances.”