Morrisons Profits Jump 11% As Sales Continue To Rise

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Morrisons profits jumped 11 per cent despite rising costs, to notch up a third consecutive year of growth.

Based in the northern English city of Bradford, the group made an underlying pretax profit of 374 million pounds in the year to February 4 - ahead of analysts' average forecast of 371 million pounds and up from 337 million pounds in 2016-17.

The retailer's margin rose from £337 million at the beginning of 2017 to £374m, following a 2.8 per cent sales increase.

"Morrisons is now entering its third consecutive year of growth", the group's chairman Andrew Higginson commented in the statement.

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With the ever-present threat of German discounters continuing to snap at the heels of the established big four, further sales growth is likely require to inspire shareholder confidence as today's special dividend - presented as a solitary offering rather than the first of many - appears to be shunned.

Potts, who worked for Tesco for 39 years, joined Morrisons in 2015 to lead a recovery after it was badly damaged by the rise of discounters Aldi and Lidl in its northern heartland and the strategic errors of previous management. While management is now guiding towards £700m in wholesale supply sales before year end, and £1bn in "due course", a continued retreat in the retail contribution to LfLs may see the need for these estimates to be raised further in order to build upon the two years' of growth now enjoyed at the group.

He added: "We had a strong year, becoming more competitive and increasingly differentiating Morrisons for all stakeholders. Listening to customers, responding, and improving the shopping trip are as important now as when we started this turnaround three years ago", he said.

Looking ahead, Morrisons said that it was confident that the group would continue to grow.