In full-year results to end January 29, released yesterday, Morrisons revealed conversion and integration costs arising from the Safeway merger in 2004 of £374.4m, and a fall in profit before tax, Safeway conversion and integration costs from £332.2m the year before to £61.5m.
It also revealed details of its long-awaited optimisation plan, with plans to save £30m on distribution and £30m on central costs and save six million staff hours in store through natural staff turnover.
However, analysts were largely underwhelmed by the plans.
Philip Dorgan from Panmure Gordon said: “There was nothing there to suggest that margins will bounce back dramatically because they need sales growth and the sales numbers are not great.”
Alastair Johnston, from JP Morgan, added: “We doubt that this is the limit of their ambitions and believe they must be banking on more uplift from sales leverage.”