Morrisons has released its latest results with the tough economic environment for the consumer to blame for the 1.0% drop in like-for-like sales for the 13 weeks to 29 April 2012.
This slip into negative sales growth means the supermarket is falling behind some of its rivals such as Sainsbury’s and Asda, and that like sector leader Tesco it is suffering from the general squeeze on consumer spending, however the business says that its performance is broadly in-line with expectations.
The good news is that Morrisons’ total sales grew by 1.5% year-on-year (3.1% including fuel) and sales from new stores increased by 2.5%, aided by a strong Q4 2011.
A statement from Morrisons said: “As expected, the economic environment for the consumer has remained challenging, with the high price of oil and other commodity prices putting pressure on disposable incomes.
“Against this backdrop we have continued to keep prices low for our customers without compromising on Morrisons quality.
“We continue to focus on the delivery of our previously announced range of strategic and operating initiatives, which combined with a close management of our cost base, gives us confidence of achieving continued profitable growth. An update on progress will be provided at our Interim Results in September.
“We are well advanced on our programme to retire £1bn of equity over the two years to March 2013. To date we have acquired and cancelled 168m shares at a total investment of £491m. The financial position of the group remains strong.”