Morrisons’ sales fall after ‘challenging’ festive period
The UK’s fourth largest supermarket reported a 1.7% fall in like-for-like sales, excluding fuel, during the 22 weeks to 5 January.
In a statement, the retailer said: “Throughout the period, trading conditions remained challenging and the customer uncertainty of the last year was sustained.
“We kept focussed on our priorities and our customers and continued to invest in the Morrisons price list while managing costs well. Our basket of key Christmas items was once again very competitive, with most prices the same as or lower than last year.
“In fuel, our business was affected by a highly promotional market.”
All the major supermarkets regularly held petrol promotions last year, offering money off a litre of fuel for spending a minimum amount on groceries. However, critics claimed the deals followed cuts to the wholesale price of fuel, rather than supermarkets passing on direct discounts to customers.
Morrisons is the second supermarket to report festive trading figures.
On Monday, Aldi announced sales in the four weeks to 24 December topped £1bn for the first time ever.
Ian Forrest, investment research analyst at The Share Centre, said: “Morrisons was the first of the big supermarket groups to report on Christmas trading today and beat expectations, although the bar was set fairly low.
“Investors will be aware the company can only manage costs up to a point as it tries to offset falling sales. Much of this is due to the strength of competition in the sector, a point underlined by the latest Kantar data, showing another fall in Morrisons’ market share while Aldi and Lidl continued to see theirs rise.
“While there are some positive signs, such as the Amazon delivery deal, the intense level of competition is not going to diminish so we continue to see the shares as no better than a Hold.”