UK grocer Morrisons has booked a drop in full-year profits, admitting its results fell short of expectations.
The supermarket group said this morning (14 March) that net profits were down 6% to GBP647m (US$966m) for the year ended 3 February as it admitted it had struggled to grow last year in a difficult consumer market.
Operating profit in the period amounted to GBP949m, down from GBP973m last year, while underlying profit before tax was down 4% to GBP901m.
The grocer said sustained pressure on consumer spending was reflected in its sales performance, with like-for-likes down 2.1%. Morrisons, which this morning announced a potential online food tie-up with Ocado, generated total sales of GBP18.1bn, up 3% on last year.
The grocer said its “below market” sales performance was “disappointing”, and that it had not done enough to communicate its promotions and value message lacked a meaningful presence in the two fastest growing sectors of the market: online and convenience.
CEO Dalton Philips said: “The sustained pressure on consumer spending was reflected in our like-for-like sales performance, which was not as good as it should have been. We have implemented a range of measures to address this and are making good progress in improving our promotional effectiveness and in communicating our points of difference.”