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Morrisons isn't giving up without a fight

The ailing grocer has gained market share for the first time since 2011.

by Jack Torrance
Last Updated: 05 Nov 2015

David Potts must be either a fast-moving genius, a whizz at manipulating numbers, or just incredibly lucky. The Morrisons CEO, who took the helm back in March, announced quarterly sales were down 2.9% in May, but things have been looking up since.

Today’s monthly figures from Kantar Worldpanel suggest that Morrisons is the only one of the ‘Big Four’ supermarkets that is growing. Its sales in the 12 weeks to 21 June were up 0.6%, the research said, and its market share has actually increased compared to last year by 0.1 percentage points to 11%. That's compared to sales declines of 3.5%, 1.3% and 1.3% for Asda, Tesco and Sainsbury’s respectively.

‘While only a small increase against a weak 2014, this does represent the first market share gains made by Morrisons since December 2011,’ said Fraser McKevitt, Kantar Worldpanel’s head of retail and consumer insight.

Potts has been praised for acting quickly to restructure the business and reversing some of the controversial changes made by his predecessor Dalton Phillips – such as the introduction of misting machines for the salad aisle.

He’s got a fight on his hands though. At the bottom of the market Aldi and Lidl continue to blaze a trail, with respective sales growth of 15.4% and 9.1%. Middle class fave Waitrose showed more modest growth of 1.2, while the Co-op has managed to hold steady.

Today also brought with it the publication of online grocery service Ocado’s latest results. Its EBITDA was up 11.4% to £38.2m on sales of £507.7m in the six months to 17 May, but that wasn’t enough to please investors – its shares were down 3.53% to 414.8p in morning trading.

The grocer has struggled to keep up with expectations since it stock market debut back in 2010, but has been focusing on securing a deal with at least one international retailer that could turn its fortunes around.

It currently has such a deal with Morrisons, but another couple could demonstrate Ocado is more valuable than its naysayers suggest. Things might not look great for it at the moment, but in a market beset by problems it’s not doing so bad.

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