Morrisons sales up for first time in 18 months

Inside A Morrisons Supermarket Ahead Of Preliminary Results

Morrisons grew sales for the first time in nearly 18 months in a welcome sign of recovery at the struggling supermarket chain, according to new figures.

But the encouraging sales performance comes as Morrisons looks set for a humiliating relegation from London's top share index in a testing week for new boss David Potts.

Industry figures from Kantar Worldpanel show the Bradford-based retailer saw sales edge 0.1% higher in the 12 weeks to May 24 compared with a year earlier.

This was the first increase since December 2013, with the group also the only one of the Big Four supermarkets to see sales rise over the three months.

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The sales figures will provide a boost to Mr Potts as he prepares to face shareholders at the supermarket's annual general meeting on Thursday, although they come as Morrisons faces being kicked out of the FTSE 100 for the first time in more than 14 years.

The latest FTSE reshuffle, which is based on today's closing share prices, is expected to see Morrisons lose its place in the top tier to make way for satellite company Inmarsat when the changes take effect on June 22.

Kantar said the turnaround plan at Morrisons was being helped by recent initiatives and online sales.

Fraser McKevitt, head of retail and consumer insight at Kantar Worldpanel, said: "A committed core of loyal Morrisons consumers is responding positively to recent initiatives and business has been boosted by online sales."

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But he added: "Morrisons' performance is an improvement on what was a difficult May 2014, so this is only the first step in any future recovery."

Morrisons held its market share at 10.9%, while its main rivals Tesco and Asda suffered falls as they continued to come under pressure from discounters Aldi and Lidl.

Tesco's market share dropped to 28.6% in the 12 weeks, down from 29% a year earlier, as sales fell 1.3% while Asda saw its share fall to 16.6% from 17.1% after a 2.4% sales slide.

Sainsbury's maintained its share at 16.5% despite a 0.3% fall in sales, according to Kantar.

Lidl reached a new record high market share of 3.9%, up from 3.6% last year, thanks to sales growth of 8.8%.

Kantar said Lidl's growth was fuelled by a combination of more consumers visiting the stores and the average basket containing more items, suggesting a growing trend for consumers to move their bigger shopping trips to the so called discounters.

Aldi also grew sales by 15.7%, taking its share of the market to 5.4%, according to Kantar.

Retail analysts at Jefferies said the fight-back at Morrisons was beginning to gain traction.

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In a note, they said: "We suspect that the re-investment into store personnel and the Match & More scheme are both starting to have an impact."

Mr Potts took the helm in March, replacing Dalton Philips, who was ousted in January after sliding profits and sales.

Thursday's annual meeting will be watched with keen interest after last year's AGM saw Mr Philips submitted to a humiliating dressing-down in front of shareholders by former chairman Sir Ken Morrison.

Sir Ken described Mr Philips's strategy as "bullshit", as the then-boss faced intense pressure amid sliding sales and a fierce supermarket price war.

It is expected that Sir Ken will be in attendance at this year's Bradford-based meeting, with other family members, who are thought likely to vent their anger at the £2.1 million paid to Mr Philips last year, plus a £1.1 million payoff.

They will no doubt also be less than pleased at the group's potential demotion to the FTSE 250, with the reshuffle results due to be confirmed tomorrow.

Morrisons has been part of the top flight since April 2001.

Bank note printer De La Rue is also in line for a demotion in the reshuffle, with its recent share price falls expected to see it fall out of the FTSE 250 into the small cap index.

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Morrisons sales up for first time in 18 months
Shopping starts long before you leave the house. Check the fridge, freezer and cupboards, then draw up a list of all the meals you plan to make and eat during the week (making sure you include any leftover perishables in those meals). That'll tell you exactly what you need to buy. This isn't everyone's favourite activity, but you'll be astonished how much less you buy - and crucially how much less you end up throwing away. This process typically cuts 5% off your grocery bill.
Supermarkets are entirely designed to make you do this, with flashy displays at the door, and discounts heaped high on the end of each aisle (they're put here because they know it takes a while to turn your trolley so they have longer to catch your eye). There will be new products and special offers which will sorely tempt you, but everything extra you buy will mean you either eat more or have more to throw away more at the end of the week.
There are three levels of products: the branded ones (including the premium supermarket ranges), the own-brands, and the own-brand value range. The best way to shift down is to move down one rung of the ladder on everything you buy - so if you usually buy branded baked beans go for own-brand, and if you usually buy own-brand, go for the value own-brand.
Most people choose a supermarket out of either convenience or habit. However, switching to a cheaper supermarket could be the easiest way to save. No one supermarket is cheaper for everything across the board. However, as a very rough rule of thumb Asda is the cheapest of the big players - it regularly wins awards for this (and did so last year), and it also has a pledge, which promises that the items you pick that are part of its scheme will be 10% cheaper than elsewhere or you can claim the difference. If you are willing to go beyond the big players, the discounters are substantially cheaper, so it's worth trying Aldi or Lidl to see what you could save.
Of course, no supermarket is cheaper for absolutely everything. And in some instances the supermarket is not the cheapest place for your food - local markets for example can offer much cheaper fruit and vegetables.

You'll need to get to know your local independents, but the best way of being sure of getting a good deal at the supermarkets is to do your research before you go. lets you compare prices for Tesco, Morrisons, Asda, Sainsbury's, Waitrose, Aldi and Ocado.

You'll need to put your shopping list into the site, which is a bit time-consuming the first time you do it but gets quicker once you have saved your favourites. It will tell you the cheapest places for your shopping - leaving you to choose whether to make more than one trip or to go with the supermarket that is cheapest for the most of your items.
There's definitely a right and wrong way to do this. The right way is to search for vouchers, coupons and deals for things you already need to buy. Alternatively, you can keep an eye out for BOGOF deals on things you regularly use (as long as they aren't perishable), and stock up on them. This can be useful for things like toiletries - just don't be tempted to switch to a more expensive brand in order to do this unless you have checked that the deal constitutes a saving from your usual brand at its usual price.
Supermarket deals are not simple to compare, so you could easily find yourself trying to work out if 350ml of something at 58p is cheaper or more expensive than 250ml of something at 46p. For most people this isn't the kind of maths that's easy to do on the fly. The only solution is to take a calculator and work it out - unless you want to focus on building world-class mental arithmetic skills.
Your careful list-making will not always go to plan, so if you end up eating something different one night, think about what you will do with the food you had planned to eat. Can you cook it and freeze it? Can you substitute it for another meal? Likewise with the leftovers, have you factored these into your eating plan? Or will you need to freeze it for next week?
This is classic advice for a reason. Research has shown that if we eat before we go we buy 18% less food. So have a sandwich and shave almost 20% off your bill.
If you are good at managing your credit cards, then shopping using a cashback card can be a great way to earn back money on your shopping. It's worth emphasising that in order for this to be a money-spinner you'll need to pay it off in full and on time every month. However, this is something that disciplined shoppers should definitely consider.
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