POSITIVE

Supermarket major Morrisons has rung up a better-than-expected 3.6 per cent hike in sales thanks to a resilient performance in its stores and at its burgeoning wholesale arm.

The UK’S fourth biggest grocery chain notched up its tenth quarterinarowofrisinggroup like-for-like sales and defied expectations of a slowdown in growth after the sector was battered by the Beast from the East cold snap in March.

But the group remained tight-lipped in the first-quarter update on the proposed £12 billion merger of rivals Sainsbury’s and Asda, which will spark one of the biggest shakeups in the supermarket sector since Morrisons itself took over Safeway 14 years ago.

The tie-up will create a supermarket titan bigger than Tesco, with revenues of £51bn and a network of 2,800 Sainsbury’s, Asda and Argos stores. The deal is certain to face lengthy scrutiny by competition regulators.

In its update, Morrisons said supermarket and online sales growth eased slightly to 1.8

0 The group, led by boss David Potts, is the fourth largest grocer in the UK

DAVID POTTS, CEO per cent in the 13 weeks to 6 May, cooling from 2 per cent in the previous three months, but this was still better than forecast.

The group said it was “now open for business as a wholesaler”, with the division largely behind the impressive performance, with sales up 1.8 per cent – a surge from the 0.8 per cent seen in the previous three months.

Chief executive David Potts said: “We are pleased to have made a strong start to the year, again becoming more competitive for customers while delivering growth on growth. We expect to continue to improve in the year ahead.

“During a busy period of exciting new ranges, new store openings, strong supermarket and wholesale growth, and the peaks and troughs of the seasons, our colleagues once again did an outstanding job for customers.”

On the outlook, the group told investors: “As announced at our recent preliminary results, we expect net debt to continue to fall during 2018/19,

“We are pleased to have made a strong start to the year, again becoming more competitive for customers.”