Morrisons in exports Thai-up as sales soar
MORRISONS cheered investors with a special dividend payout and struck its first international deal as it continued its turnaround with its best quarterly sales growth for nearly a decade.
Britain’s fourth biggest grocer will begin exporting 100 of its own-brand products to Big C stores in Thailand in a further expansion of its wholesale business, which will also supply MPK Garages forecourt stores in the UK.
Morrisons already has supply deals with Amazon Fresh and convenience chain McColl’s and is targeting annual wholesale revenue of £1billion.
Its fightback under chief executive David Potts against competition from German discount chains Aldi and Lidl continued with half-year like-for-like sales excluding fuel of 4.9 per cent.
This included 6.3 per cent growth in the second quarter, its best for nine years. Its performance was boosted by the World Cup, fine weather and the Royal Wedding.
Underlying pre-tax profit was up 9 per cent to £193million on 4.5 per cent higher revenue of £8.8billion and it will pay a special dividend of 2p a share, increasing the total half-year payout by 132 per cent to 3.85p.
While Morrisons, which has 496 stores, is British farming’s biggest single supermarket customer and two thirds of what it sells is British, Potts said it had been approved as an authorised economic operator which will help avoid border delays in the event of a hard Brexit.
He said: “It means we are considered by the authorities to be a company which has policies and procedures that are thorough and wholly trusted and therefore any hold-ups at customs are, to some extent, simplified. I think it also avoids some fairly complex tariff refunds as well.” Potts insisted scale was “not the defining feature” of supermarket retailing, pointing to its investment in staff and deals with local suppliers which are helping it to win back customers.
He said: “Morrisons continues to become broader, stronger and a more popular and accessible brand, and I am confident that our exceptional team of food makers and shopkeepers can keep driving the turnaround at pace.”