Morrisons reports improving sales but still has ‘plenty of work to do’ says CEO

Discussing the first quarter trading, Morrisons CEO 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.”

In February, Morrisons had its credit rating cut by credit rating agency Moody’s.

Moodys downgraded the chain after cautioning that the firm’s ability to repay its debts, estimated at the time as roughly £7.5 billion, had moved from stable to “negative”.

Late 2021 also saw Morrisons taken over by US firm Clayton Dubliner and Rice for £7 billion.

In May of 2022, Morrisons acquired convenience store chain McColl’s. There are now 350 former McColl’s stores trading as Morrisons Daily with around 10 new conversions every week.

This week, Morrisons reached the milestone of 500 Morrisons Daily convenience stores with the opening of the Phoebe Street store in Salford.

Discussing the opening of the 500th Morrisons Daily store Mr Potts added: “This is an important milestone for us and cements a leading position in the UK’s growing convenience market. With every new Morrisons Daily conversion, we see an immediate and substantial uplift in like-for-like sales, often of more than 20 per cent.

“We expect to reach 750 Morrisons Daily stores in the autumn and the 1,000 store mark early next year.”