10th Mar 2014 07:47
LONDON (Alliance News) - WM Morrison Supermarkets PLC is expected this week to announce price cuts and GBP500 million of property sales to combat discount rivals such as Aldi and ease shareholder worries, according to the The Sunday Times.
The major British supermarket is poised to go a step beyond recent reductions announced by Asda and Tesco PLC by spending hundreds of millions cutting prices and selling properties.
Last week, the company undercut the price of four pints of milk to 96 pence - a move analysts Panmure Gordon estimated will cost GBP78 million over a year, according to the Sunday Times.
Morrisons are under pressure from 'hard discount' chains such as Aldi and Lidl from Germany, after the companies succeeded in taking a large amount of the customer base from Morrisons in the wake of the financial crisis.
Morrisons is due to announce full-year results on Thursday. Analysts forecast a 1.7% decline in sales to GBP17.8 billion and a fall of almost 20% in pretax profit to GBP718 million, once costs relating to its recent Ocado Group PLC deal for online deliveries are stripped out.
Morrisons, which has a total property portfolio worth GBP10 billion, also is expected to sell its distribution centres and its portfolio of small shopping centres before selling and leasing back some stores.
http://www.thesundaytimes.co.uk/sto/business/Companies/article1384782.ece?CMP=OTH-gnws-standard-2014_03_08
By Tom McIvor; [email protected]; @TomMcIvor1
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