Morrisons reports pre-tax loss of £176m
Morrisons has reported a pre-tax loss of £176m for the year ending 2 February, compared with profit of £879m for 2012/13.
According to its preliminary results, the grocer saw a 2% fall in turnover to £17.7bn, compared with £18.1bn a year earlier. Like-for-like sales excluding fuel and VAT were down by 2.8% and underlying pre-tax profit declined by 13% to £785m.
Chief executive Dalton Phillips revealed that a strategic review of the business has been undertaken which has included an 'enhanced focus' on the core supermarket business and major investment in the proposition of £300m in 2014/15. The strategy also includes a planned exit from non-core activities, including Kiddicare and Fresh Direct.
Mr Phillips said: 'The strategy we are announcing today is a bold and comprehensive response to the fundamental structural changes that are taking place in grocery retail.
'We are significantly reducing our cost base and will invest £1bn into our proposition over the next three years, to improve our value even further and to defend and strengthen our competitive position. Customers will see this in our stores as well as in our fast growing online and convenience offers.
'At the same time we will exit non-core activities, significantly reduce our capital expenditure and deliver improved operating cashflow and return on capital employed.'
The retailer launched its online offering Morrisons.com in January this year and says it is performing ahead of plan. In addition, it opened 18 new supermarkets during the year. More than 100 M local convenience stores are now trading and a second convenience distribution centre is now operational.
Chairman, Sir Ian Gibson, said: 'In trading terms this has been a disappointing year for Morrisons, with consumer confidence and market conditions continuing to be challenging. It has however been a period of significant strategic progress as we lay the foundations for a stronger future.'