Morrisons share price drops as grocer scraps former CEO innovation
Wm Morrisons Plc (LON:MRW) has scrapped an unpopular innovation introduced by former chief executive Dalton Philips, The Independent has revealed. Morrisons’ share price has lost more than two percent in today’s trading.
The Independent today reported that store managers had been told that the in-store misting machines introduced by Morrisons’ former boss had to go in the coming weeks. Philips installed the machines in around 300 branches of the chain to give Morrisons’ fruit and vegetables a spray of moist freshness. The move was part of Philips’ plan to increase the retailer’s market share amid competition from rivals Tesco (LON:TSCO), J Sainsbury (LON:SBRY) and Asda.
The Grocer today quoted a Morrisons’ spokesman as confirming the news.
“The move is about going back to basics, using simpler refrigeration techniques and Morrisons’ traditional strengths in fresh food management, to ensure that our vegetables stay fresh,” the spokesman explained.
The industry magazine noted that Phillips was criticised by City analysts and company founder Sir Ken Morrison for what was perceived as an attempt to take the retailer upmarket while consumer spending was being squeezed and discounters such as Aldi and Lidl were beginning to gain significant market share. The Independent quoted store workers as suggesting that the misting machines had exacerbated this effect giving shoppers the impression that Morrisons had become too upmarket for them and that they would be better off at the discounters.
According to the Financial Times, as of February 6, the consensus forecast amongst 27 polled investment analysts covering Morrisons has it that investors should hold their position in the company. The 16 analysts offering 12-month price targets for the blue-chip supermarket have a median target of 179.00p, with a high estimate of 270.00p and a low of 135.00p.
As of 14:56 GMT, Wednesday, 11 February, Wm. Morrison Supermarkets plc share price is 180.10p.