Profits at Morrisons have dived by more than half after the supermarket chain’s sales were savaged in the industry’s ongoing price war.
Like-for-like sales slumped by 7.4 per cent in the half-year to August 3, while underlying profits dropped 51 per cent to £181m as the Bradford-based company committed more money to lowering its prices.
It is six months into a three-year turnaround plan involving an “enormous amount of change and modernisation” but said it was too early to see the impact of this work on sales.
Chairman Sir Ian Gibson said: “Conditions are tough, and the industry is going through unprecedented change.”
Tesco and Morrisons have been the major casualties in the recent shake-up of the sector, with Tesco recently cutting its half-year dividend payment by 75 per cent in order to preserve funds for new chief executive Dave Lewis.
Morrisons said today that its financial position remained strong and that it would increase its interim dividend payment by 5 per cent.
Chief executive Dalton Philips said: “Although it is too early to see the benefits of the three-year plan in the sales line, Morrisons is getting back on the front foot, and implementing change and innovation at real pace throughout the business.”