Morrisons has reported its first rise in profits in six years as its turnaround plan continues to bear fruit. Chief executive David Potts said the positive growth “was powered by listening to customers.”
The retailer boasted a 49.8% rise in pre-tax profits to £325m for the year to 29 January. Stripping out restructuring costs and other adjustments, Morrisons' pre-tax profits rose by 11.6% to £337m. Meanwhile, like-for-like sales grew 1.7% over the year, buoyed by a 2.5% rise over the crucial Christmas period.
“Our full year of like-for-like sales and profit growth was powered by listening to customers, and shows what our hard-working team of food makers and shopkeepers can do,” said Potts.
“Our turnaround has just started, and we have more plans and important work ahead. If we keep improving the customer shopping trip, I am confident that Morrisons will continue to grow.”
It ends a year which saw Morrisons bring in a new advertising agency in Publicis London following the permanent appointment of Andy Atkinson as marketing and customer director the same month. Since then, its marketing has sought to move away from differentiating solely on price and instead show the parts of the business that make Morrisons unique and food quality, as well as the role it plays in everyday family life.
Paul Thomas, senior consultant at Retail Remedy, said Potts will be justly proud of the turnaround few thought possible 24 months ago.
“Future growth looks certain following deals with Ocado and Amazon as Morrisons looks for revenue streams outside of its supermarkets and without the major capital investment into new stores and formats,” he said.
“That said, achieved cost savings now reported over £1bn, Morrisons have money to reinvest in store refits, the customer journey, range development, supply chain efficiencies, online and wholesale. No mean feat.”