The dark days that followed the 2004 Safeway acquisition are firmly in the past for Morrisons
Sir Ken Morrison may have retired to tend the flowers in his new walled garden, but he left the business on a high in February, able to proclaim in the Bradford-based supermarket's annual report for 2007 that the chain he built had returned to its winning ways.
Sir Ken's career was unblemished prior to the acquisition of Safeway in 2004, but following well-publicised integration problems, profits plunged, market share fell, the share price nosedived and so too staff morale.
The latest results tell a different story. Showing he was not afraid to shirk convention, Sir Ken brought in an outsider, Marc Bolland, the suave Heineken exec.
With the Dutchman's help, Sir Ken and the senior management team set to work, at the start of 2007, having finished the biggest store conversion programme in the UK, following the Safeway acquisition. With sharpened objectives from a strategic review, based on being the 'food specialist for everyone', in 2007 Morrisons refreshed the entire store estate externally and half the estate internally, developed a new brand identity and a highly impactful new TV ad campaign, introduced more than 8,000 new lines, redesigned 4,000 own-label packs and 1,700 in-store prepared lines, as well as launching a store space rebalance programme. The results spoke volumes: pre-tax profits up 66% to a record £612m. Margins nudging 5%. Customer numbers up 2.6%. The dividend up 20%. Surplus capital of £1bn returned to shareholders.
The clear winner over Christmas, Morrisons has underscored this was no flash in the pan by outperforming all its rivals for an unprecedented 26 weeks in a row. As he prunes the roses, Sir Ken will be a proud man.