FOOD RETAILERS
Morrisons increases forecast as sales grow
Led by a new management team, Morrisons reported a fifth straight quarter of underlying sales growth
British supermarket Morrisons raised its profit forecast on Tuesday after enjoying its strongest Christmas sales performance in seven years, while industry data showed market leader Tesco was also a festive winner. Britain’s overall grocery market grew 1.8% in the 12 weeks to January 1, the fastest growth since June 2014, data from market researcher Kantar Worldpanel showed. It said that higher prices were returning to the market after two years of deflation. While a return to food price inflation, in moderation, would be welcomed by investors in food retailers as it can boost sales and profit margins, the flip side is that it may begin to squeeze consumers’ purchasing power later in 2017. Led by a new management team, Morrisons reported a fifth straight quarter of underlying sales growth, showing it was getting to grips with the turmoil sparked by the advance of German discounters Aldi and Lidl. That news and the Kantar data sent shares in Morrisons and Tesco up 3.7% and 4.5%, resp...
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