Bleak Midwinter

9 January 2014 By Robert Cole

Morrisons has stolen Tesco’s thunder – with a thundering profit warning. It’s been a tough Christmas for UK supermarket retailers: but Morrisons is trailing the pack on sales. For Tesco, the big issue remains profit margins. An aggressive new period of price cuts beckons.

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Two UK supermarket groups published disappointing updates on Christmas trading on Jan. 9. WM Morrison, bringing forward a statement that was scheduled for Jan. 20, said that like-for- like sales fell 7.1 percent in the six weeks to Jan. 5. Tesco said its UK sales in the six weeks to Jan. 4 fell 3.1 percent.

Excluding fuel and VAT sales tax, Tesco sales fell 2.4 percent. The equivalent number at Morrisons was minus 5.6 percent.

Shares of WM Morrison fell 5.5 percent by 0950 GMT. Tesco stock dropped 1.4 percent by the same time.

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