Last updated 12/03/2009
Strong operating performance confirms broadening appeal of Morrisons
Financial summary
· Turnover up 12% to £14.5bn (2007/8: £13.0bn)
· Like for like sales (ex fuel) up 7.9% (2007/8: 4.6%)
· Profit before tax £655m (2007/8: £612m)
· Underlying profits up 13% to £636m (2007/8: £563m)
· Net debt £642m (2007/8: £543m) after capital investment of £678m
· Gearing of 14% (2007/8:12%) and interest cover of 42 times
· Basic earnings per share 17.4p (2007/8: 20.8p)
· Underlying earnings per share up 16% to 16.7p
· Total dividend for the year up 21% to 5.8p
Operating highlights
· 550,000 more customers per week reflecting broadening appeal
· Optimisation Plan on track
· Programme to freshen up the stores and brand completed
· Continued investment in infrastructure: new abattoir opened, vegetable pack-house extended and regional distribution centre under construction
· Nine new stores opened in 2008/09 and 90,000 sq ft of sales extensions
· Original target of 1.0m sq ft of new store space by January 2010 to be exceeded by 0.5m sq ft with acquisition of Co-op/Somerfield stores completing in the coming year
National to Nationwide
Our performance over the year confirms our broadening customer appeal, successfully delivered in a wide range of stores from 11,000 to 40,000+ square feet. We have identified significant potential to attract new customers and will focus on space growth in order to take us from a national to a nationwide company.
We confirm a new space target of 500,000 square feet in 2010/11.
Outlook
The Board views both the short and the long term outlook for Morrisons positively. The business is well on track to achieve its goal of being the Food Specialist for Everyone, and the Executive team continues to see opportunities to invest in the business to generate further growth. We expect to open c350,000 square feet of new retail space in the coming year, on top of c500,000 square feet that we have agreed to acquire from the Cooperative Group, reflecting our confidence in the attractions of Morrisons core grocery business.
In the current economic environment we expect the competitive landscape to be extremely challenging. However, the Group’s balance sheet is strong, and our financing arrangements are prudent. We will remain focused on delivering freshness and value to our customers.
Commenting on the results, Sir
“This was another year of good progress for Morrisons as we continued to grow sales, profits and dividends, whilst also investing to generate future growth.”
Chief Executive,
“Our focus on fresh food and value appeals to shoppers everywhere and provides a strong platform to take Morrisons from national to nationwide.”
-ENDS-