Morrisons soaring by 19 per cent as shoppers seek lower prices

Wm Morrison is attracting some 500,000 more shoppers a week to its supermarkets — sending sales at the grocery giant soaring.

Chief executive Marc Bolland today said customer numbers rose 4.7% to about 10million a week in the first half of the year as shoppers feeling the pinch hunted down deals.

Extra customers, and higher food prices, sent like-for-like sales excluding fuel up 7.6% in the 26 weeks to 3 August.

It was comfortably ahead of recent figures from rivals such as Tesco and Sainsbury and helped drive underlying profits up 18.5% to £295million.

David Buik of BGC Partners said the sales figures were "staggering" but shares fell 2-½p to 267-¾p.

Morrisons and Asda — as well as discounters such as Aldi and Lidl — have been the main beneficiaries so far as shoppers are squeezed by rising bills.

Bolland described the current trading climate as the toughest for many years. "To have grown like-for-like sales by 7.6% in this economic climate is clear testament to the strength of the Morrisons recovery," he said.

"More shoppers are choosing Morrisons because of our price-crunching deals and our unrivalled fresh offer in store."

Bolland, the ex-Heineken executive now running the 376-strong supermarket chain, has led a drive towards fresh produce as the firm recovers from the botched takeover and integration of Safeway.

The focus on value has certainly paid off in London — Morrisons has 22 stores within the M25 following the takeover of Safeway — where sales growth is in double digits.

"What we are seeing in London is a very strong focus on value and we are seen as a value player," said finance director Richard Pennycock, who has led the turnaround of Morrisons with Bolland.