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Morrisons lifts FY pretax profit

09 March 2017 07:25

Morrisons has lifted its reported FY pretax profit by 49.8% to £325m, from £242m previously, but, looking ahead, has cautioned on the impact of a weaker sterling, depreciation and pension costs.

"Our turnaround has just started, and we have more plans and important work ahead. If we keep improving the customer shopping trip, I am confident that Morrisons will continue to grow," said CEO David Potts.

Turnover was up 1.2% to £16.3bn, with like-for-like sales excluding fuel and VAT up 1.7%. Final dividend was 3.85p a share, taking the total to 5.43p, up 8.6%.

Looking ahead, Potts said he was confident that Morrisons could continue to turnaround and grow.

"There are some uncertainties ahead, especially around the impact on imported food prices if sterling stays at lower levels," he added.

"We also expect depreciation and pension costs to increase, and we will continue to invest in colleague pay rates. However, all of this is incorporated into our plan."

During the year, Morrisons achieved £18m of incremental profit from wholesale, services, interest and online, and remain confident of its £50m-£100m medium-term target.

"We have identified further cost saving opportunities beyond the £1bn already achieved, in: ordering, distribution between Manufacturing and Retail, in-store administration, and procurement of goods not for resale."

Potts said Morrisons' medium-term targets of £1bn improvement in working capital and at least £1.1bn of disposal proceeds remain unchanged.

He expected net debt to continue to fall to less than £1bn by the end of 2017/18.

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Related Company: MRW

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