High street alarm 'load of nonsense'

WARNINGS about increased competition in the high street from some leading food retailers are 'a load of nonsense', according to Wm Morrison Supermarkets, the Bradford-based grocer.

Martin Ackroyd, finance director, said he believed the complaints were 'a ploy by some companies to wrong-foot the industry'. While more business had been concentrated into fewer large groups, that was offset by the decline in local high street stores.

He added that all the supermarket chains advertised their lowest prices and special offers. 'We believe the important thing is how much the customer has to spend on the weekly shop.'

His comments came as the group announced a 16.7 per cent rise in pre-tax profits to pounds 97.8m, on a similar rise in sales to pounds 1.5bn, for the year to 30 January.

Operating margins, which had declined in the first half of the year, rose from 6.4 to 6.6 per cent, although Mr Ackroyd said that was due to a large price promotion in the autumn of 1992, which depressed the comparative figures.

The gross margin also rose from 21.4 per cent to 21.8 per cent as the group forced its suppliers to cut their prices.

Like-for-like sales were 3.5 per cent higher in 1993 and have been increasing by 4.6 per cent in the first seven weeks of the current year. That is partly because the group has started opening on Sunday, so is winning back sales it had lost to rivals.

Earnings per share were 8.05p, up from 7.23p, and the dividend is increased by 25 per cent to 1p, via a 0.8p (0.64p) final. The shares rose 3p to 120p.