First-half profit for William Morrison Supermarkets Plc, the smallest of the four main U. K. food retailers, grew 42 percent, since the customers from larger competitors were lured by price cuts and revamped fresh-food aisles.
It was confirmed by the Bradford, England-based Company today via a statement that its net income hiked to 309 million pounds from 218 million pounds a year earlier, while a rise by 22 percent was seen in pretax profit before one-time items to 359 million pounds. This nearly matched the 358 million- pound average estimate of seven analysts, in a Bloomberg poll.
The larger rivals like Tesco Plc, J Sainsbury Plc and Wal-Mart Stores Inc.'s Asda, have been overshadowed by Morrison, which has lured customers with discounts and on-site bakers and butchers. In the month of July, the retailer specified that earnings will be better than its forecast, on market-share growth and a reduction in costs.
In a note, Charles Stanley & Co. analyst Sam Hart informed, "We expect Morrison to continue to deliver industry leading sales growth and significant potential exists to further expand operating profit margins. As such, earnings growth is forecast to be the strongest in the sector over the next three years."
Yesterday, in London trading, Morrison experienced a fall by 1.6 pence, or 0.6 percent, to 284.5 pence. This year, the stock hiked by 1.5%, less than Tesco's 5.9 percent advance.
While the first-half revenue grew 5 percent to 7.5 billion pounds, the company specified that a rise by 7.8% was witnessed in sales at stores open at least a year, excluding gasoline and value-added tax.