Morrison Supermarkets (MRW.L), one of the biggest grocery stores in the UK, reported early Tuesday lackluster like-for-like retail revenue growth during the Christmas holiday period, citing a “change in consumer behavior.”
Retail’s contribution to group like-for-like sales was 0.6% over the nine weeks that ended Jan. 6, compared with 2.1% over 10 weeks to Jan. 7 in 2018, the company, whose 500 stores get 11 million customer visits weekly, said in a trading update.
The modest contribution reflects a small decline in the number of transactions, which were down by 0.9% over the nine-week period and outweighed a marginal 0.8% increase in items per basket.
Although like-for-like sales including the group’s wholesale business, which supplies Safeway-branded products to convenience stores as well as Amazon, grew by 3.6% compared with 2.8% a year ago, it was down sequentially from the second and third fiscal quarters which were up by 6.3% and 5.6%, respectively. The September quarter for Morrison, which is is part-way through a business turnaround, was the best in about nine years.
“As has been widely reported, there was a change in consumer behavior during the period,” the company, which kept its 2018/19 year-end expectations unchanged, said in the trading update. “We were again more competitive, with the price of our basket of key Christmas items the same as last year.”