Morrisons share price soars as grocer’s recovery continues

Shares in Wm Morrison Supermarkets (LON:MRW) have jumped in London this morning, as the blue-chip supermarket posted a small rise in quarterly like-for-like sales, in a sign that recovery under the group’s chief executive David Potts continues. The group’s total sales, however, declined in the first three months of the year, reflecting the impact of supermarket closures and exit of the M local chain.

As of 09:56 BST, Morrisons’ share price had jumped 3.89 percent to 194.80p, outperforming the FTSE 100 which currently stands 0.48 percent higher at 6,141.32 points. The grocer’s shares have gained about four percent over the past year, and are up more than 30 percent in the year-to-date, helping the company stage a return to the blue-chip index.
Morrisons announced in a statement this morning that its like-for-like (LFL) sales, excluding fuel, had climbed 0.7 percent in the 13 weeks to May 1, helped by the supermarket’s online business which contributed one percent to LFL during the reported period. The group’s total sales meanwhile slipped 1.8 percent reflecting the impact of supermarket closures and exit of the M local chain.

“We are encouraged by progress across our six priorities,” the company’s chief executive David Potts, who took the reins at Morrisons a little over a year ago, commented in the statement. “We are of course pleased with a second consecutive quarter of positive LFL sales, which demonstrates our aim to stabilise trade is taking effect.”
Going forward, Morrisons flagged continued deflation and sustained improvement in customer satisfaction, with growing LFL volume remaining a key priority.
City A.M. quoted Shore Capital’s Clive Black as commenting that Potts had “spoken of the business travelling on a long journey of self-improvement, and this remains the case with much more to do for the business to deliver upon its potential”.
“However, we do not underestimate the enormous achievements to date by the new management team either, the assembly of which was only completed in December 2015,” the analyst added.
As of 10:16 BST, Thursday, 05 May, Wm. Morrison Supermarkets plc share price is 194.40p.

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