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Leading supermarket chain Morrisons has announced a 10% drop in underlying profit. Compared to £445m in 2012/13 the company has today reported a £401m, with like-for-like store sales dipping by 1.6%.
The results did though contain some positive news for investors. Total store sales rose by 0.8% and the company will offer an interim dividend of 3.84p, up from 3.49p in 2012/13.
In a statement the company said that “early indications of a recovery in the UK economy” had yet to make an “impact on consumers’ pockets”, but they expect “an improvement in our sales performance during the second half” of the year.
Financial summary:
• Total turnover £8.9bn in line with last year (2012/13: £8.9bn)
• Total store sales up 0.8% (2012/13: up 1.3%). Like-for-like store sales down 1.6% (2012/13: down 0.9%)
• Underlying profit(1) down 10% to £401m (2012/13: £445m)
• Underlying earnings per share down 2% to 12.86p (2012/13: 13.09p)
• Profit before tax £344m (2012/13: £440m)
• Interim dividend up 10% to 3.84p (2012/13: 3.49p)
• Net debt of £2,529m (2012/13: £1,680m)
• Gearing of 48% (2012/13: 32%)
Responding to the results Morrissons’ non-executive chairman, Sir Ian Gibson, argued that consumer confidence and market conditions had “remained challenging” in the first six months of 2013.
“We have continued to invest in and develop our customer offer and this has been reflected by an improved sales performance compared to the second half of last year. Our financial position is strong and we remain focused on maximising returns from our assets and delivering superior shareholder returns. Once again our interim dividend is increased by 10%, in line with our previous commitment” said Sir Ian.
