The rate of sales growth at Morrisons fell sharply in the first quarter as a result of the disappearance of food price inflation.
In the week that former chief executive Marc Bolland began his new role at Marks & Spencer, the Bradford-based chain reported like-for-like sales for the 13 weeks to 2 May up just 0.8%.
The growth is down from 6% in the year ended 31 January and at the lower end of analysts’ forecasts of up to 3%.
Total sales, excluding fuel, were up 5.9%.
In today’s quarterly management statement the retailer said it continued to grow share in the first quarter and was attracting record numbers of customers into its stores.
“As expected, commodity prices have continued to ease, resulting in the virtual elimination of food inflation and lower market growth,” the supermarket said.
“We are satisfied with our sales performance, which has continued to outpace the market despite facing tough prior-year comparative numbers.
Morrisons said its net debt position was in line with expectations, adding that new boss Dalton Philips was still familiarising himself with the group’s operations.
Despite the gloomy economic environment and caution over consumer spending, Morrisons said its expectations for the remainder of the year were unchanged.
Bolland begins new era at Marks & Spencer (4 May 2010)
Marc who? Morrisons exults in record profits (13 March 2010)
City heaps praise on Morrisons’ choice of new chief executive (30 January 2010)