27th Jul 2005 07:00
Morrison(Wm.)Supermarkets PLC27 July 2005 NEWS RELEASE NEWS RELEASE NEWS RELEASE NEWS RELEASE 27th July 2005 Wm Morrison Supermarkets PLC Pre-close Sales Update for Half Year Ended July 24th (25 weeks) Today's sales update is issued ahead of the closed period which will commence on19th August. Sales Total like-for-like sales for the continuing business for the half year haveincreased by 5% or 2.6% excluding fuel. The like-for-like sales break-down for the half year was as follows: • Stores now converted to Morrisons (from Safeway) increased sales by11.6% or 10.9% excluding fuel. However these figures include any "unconvertedperiod" during the half year and, when this unconverted period is excluded,converted stores like-for-like sales increased by 15.7% or 15.6% excluding fuel.This sales uplift is driven by customer numbers increasing by 23.2% postconversion. • Continuing Safeway stores awaiting conversion traded positively withlike-for-like sales increasing by 3.9% or 3.4% excluding fuel. • Like-for-like sales in the core Morrison estate increased by 1.1% butexcluding fuel were down 2.7% as stores adjusted to the one-time impact ofSafeway stores sold to competitors resulting from undertakings given to theOffice of Fair Trading as part of the Safeway acquisition. There was also somecannibalisation of sales resulting from Safeway stores converting to Morrisons. Group sales, on a statutory accounting basis, were £6.363bn, an increase of 3%influenced by an extra 5 weeks contribution from Safeway stores. On a strictlycomparable 25 week basis, sales decreased by 7.4% reflecting primarily the saleof 181 stores over the past year. Store Conversion Process At the half-year end 148 former Safeway stores had been converted to Morrisonsand there were 280 stores successfully operating to the Morrisons format. We remain on track to complete the accelerated conversion process by lateNovember 2005 by which time 360 stores across the UK will be trading asMorrisons. This group of stores will comprise over 10m sq.ft. of selling space,averaging 28,500 sq.ft. per store with a 92% freehold content. Customers benefit from an enhanced food product range and better service in wellmaintained stores. They also enjoy Morrisons great value. In the recent GrocerMagazine annual awards we were pleased to be first for best product availabilityand customer service - great testament to the way in which our people arehandling the conversion process. In 2006 and 2007 we will focus our attention on the optimisation of theremodelled and much larger Morrisons store portfolio we have created through aperiod of immense change. Store Disposals A number of contracts to dispose of former Safeway stores are at various stagesof the legal process. These are stores which would not successfully carry theMorrisons brand and generally are leasehold and fully rented. New Stores & Major Extensions New stores have been successfully opened this year in Scotland - at Hamilton andAuchinlea (Glasgow). There are 5 further new openings in the second half of theyear - 3 more in Scotland and 2 in southern England. Major extensions are beingadded to stores at Coventry and Hinckley - 4 other major extensions having beencompleted in the first half of the year. Board Brian Flanagan, Susan Murray and Nigel Robertson joined the Board on 1st July.As independent non-executive directors, together with David Jones, they willeach be members of the Nomination, Remuneration and Audit Committees. TheNomination Committee will be chaired by Sir Ken Morrison, the Remuneration andAudit Committees by David Jones. KPMG continue their review of the Group'sfinancial forecasts, reporting to the Board. The Board remains comfortable withits profit guidance for 2005/06 issued on 8th June. (ENDS) Enquiries: MorrisonsGillian Hall 01274 356804 Citigate Dewe Rogerson 020 7638 9571Jonathan ClareSimon RigbySarah GestetnerAnthony KennawayFiona Mulcahy Notes Headline sales information is issued on a strict annual like-for-like basis.However the following may also be helpful in understanding the progress of thestore conversion programme - fuel exclusive figures are quoted unless otherwisestated. • Customer numbers across all store conversions are now showing acumulative uplift over the half year of 23.2%. Sales per average transactionare however 6.2% less than the equivalent period last year and £4.06 less thanthe average spend in core Morrisons. • Sales per square foot are cumulative £18.54 in the half year. (Thiscompares with £20.25 in the core Morrisons estate in the same period). • Cumulative sales in converted stores are 14.1% higher at £203 millionthan in the cumulative equivalent unconverted period. (£268m higher includingfuel). • Sales in week 25 (the last week of the half year) were 16.4% higherthan the average of the 13 weeks sales at each store prior to conversion. Communications • Analysts' Conference Call at 9.00am on July 27th. Dial in number 0207365 1856; reference: Morrisons. • Interim Results in UK Gaap format will be announced on October 20th.A further presentation will be made on November17th, re-stating both the 04/05final results and the 05/06 Interims in IFRS format. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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