It takes time to turn around a supertanker, says former Morrisons director
MORRISONS shareholders must be patient, because new boss David Potts is taking the company back to its core values, according to former property director Roger Owen.
Mr Owen, who was a former aide to Sir Ken Morrison, was a fierce critic of the strategies implemented by the former chief executive Dalton Philips.
Last year, he compared Bradford-based Morrisons to “a supertanker heading towards an iceberg” but he has taken a more positive view of the performance of Mr Potts, who replaced Mr Philips earlier this year.
Morrisons has announced the closure of 11 supermarkets putting 900 jobs at risk as it reported its latest slump in profits.
Pre-tax profits for the half-year to August 2 fell 47 per cent to £126m while like-for-like sales for the period dropped 2.7 per cent compared with the same period last year.
Mr Potts said the group faced a “long journey” to turn around its fortunes.
It comes a day after Morrisons said it was selling 140 M local convenience stores for around £25m to concentrate on its larger supermarkets.
Mr Owen said the announcements were predictable because the company had flagged them up for some time.
He said the stores that were earmarked for closure were likely to be smaller ones.
He added: “David Potts says he clearly intends to reinvigorate and concentrate on the core business.”
With regards to the closures and the sale of the convenience stores, Mr Owensaid: “He’s had to do it - you can’t sustain losses of that nature.
“The big thing about the convenience stores is that they were in the wrong place and they paid a premium for them. Philips has got an enormous amount to answer for.”
He said Mr Potts had rung him on his first morning in the job to ask for his views, and the two men later arranged to meet.
Mr Potts said Morrisons’ shareholders needed to be patient, adding:”To go back to the supertanker analogy - before you can turn it around you’ve got to stop the thing.
“They have got to get back to the old values.”
He said that traditionally, Morrisons’ board had taken heart from the philosophy of Millwall football club - “nobody loves us but we don’t care”.