Morrisons’ trading figures indicative of low growth market, say analysts

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Morrisons: low growth but expansion opportunities

Morrisons: low growth but expansion opportunities

Sales at Morrisons, the UK’s fourth largest supermarket, rose by just 0.7% on a like-for-like basis in the six weeks to 1 January 2012 and by 2.9% in total.

Morrisons said Christmas 2011 was a challenging period for the consumer and trading came later in the season.

Neil Saunders, managing director of retail analysts, Conlumino, said: “Given Morrisons’ recent track record, these results show disappointingly slim growth, especially so as comparatives against last year were not particularly tough and Morrisons is not as exposed to the pressurised non-food market as other grocers.

“That said, the figures are indicative of the low growth environment that now characterises UK food retailing, which was exacerbated by extensive discounting in the run up to Christmas. Against that backdrop, Morrisons’ numbers are more reasonable and its market share is likely to have remained stable over the festive period.

“Over the longer term, we expect Morrisons’  performance to pick up and for it to gain share, unlike most other supermarket players, it is in the unique position of having extensive opportunities for geographical expansion and is also able to accelerate growth in non-food.”