Home Business NewsBusiness Morrisons shares drop 10% on news of £176m loss

Morrisons shares drop 10% on news of £176m loss

13th Mar 14 9:09 am

Morrisons made a £176m statutory loss for the year to the end of February, with revenues falling 2% to £17.7bn.

It’s a significant change in position from last year, when it reported a £879m profit.

Morrisons also warned that profits in the year ahead would be less than £375m.

Shares tumbled by about 10% in early trading this morning following the news, to around 207p.

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The supermarket chain has struggled as low-price supermarkets Lidl and Aldi have grown in popularity.

To try to boost its position, Morrisons has announced that it will sell £1bn of the £9bn-worth of property it owns, and embark on a revamp of its stores.

“The strategy we are announcing today is a bold and comprehensive response to the fundamental structural changes that are taking place in grocery retail,” CEO Dalton Philips said.

“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,” he added. “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.”

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