Morrison’s Christmas sales beat forecast
Despite a difficult 2015, UK retailer Morrison's posted a growth in December, boosting optimism in the flagging company's shares
Print12 January 2016
As the December results roll in, UK grocery giant Morrison’s has reported better than expected sales over the period, in comparison to the same time in 2014. Like-for-like sales, excluding fuel, rose by 0.2% in the nine weeks up to 2nd January.
This is a very small amount, but a boost for Morrison’s all the same given that experts had predicted a drop for the retailer over the Christmas shopping season. The latest figures are the company’s first positive results in more than a year, leading to a 10% surge in the company’s share price.
Hannah Maundrell, editor-in-chief at money.co.uk, reasons that this unexpected increase is a result of Morrison’s realising the rock-bottom price war was one it was never going to win. “After disappointing results throughout the year, its change in tactics appear to have paid off over the Christmas period,” Maundrell said.
“Despite the upturn,” she added, “it still feels like Morrison’s are still working out who they are. They aren’t the cheapest, their loyalty card isn’t the most lucrative, and they are no Waitrose.
“Morrison’s still needs to carve out a niche for itself if it’s going to continue as a big player in the supermarket game.”
Regarding the company’s increased share price, Joshua Raymond, broker at XTB.com agreed that the increased sales came as a surprise to the industry. “Many were expecting a fall of around 2 per cent,” he said. “Instead, shareholders have been given renewed hope that the UK’s fourth largest supermarket firm can turn itself around.
“The key now,” he said, “is whether the company can build on this positive surprise or is it merely a one-off?”
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