Some signs of light at the end of the tunnel weren’t enough to stave off investor anger at Morrisons’ AGM this week. One took a pop at the supermarket’s now-cancelled promo deal with Ant & Dec and some took issue with the remarkably uniform background of its senior leadership team (all of whom were previously at Tesco), but particular ire was reserved for the pay packet of recently departed chief exec Dalton Philips.
Philips, who was so famously berated by the supermarket’s life president Sir Ken Morrison at last year’s AGM, will receive £2.1m for this year, despite being sacked back in January. Shareholders were understandably peeved, with 37% voting against the company’s executive remuneration plans, but chairman Andy Higginson said it was the least they could legally pay out.
Sir Ken, son of the chain's founder William Morrison. heaped praise on Higginson and his new chief executive David Potts. ‘I've personally met both of them and I'm reassured by their stated intention to restore the company to its glory days,’ he said, and perhaps with good reason.
Potts has taken some seriously drastic action since taking the helm, including slashing 720 head office jobs, and it looks like his efforts are beginning to bear fruit. Its latest quarterly figures were pretty stark, and it narrowly escaped being ejected from the FTSE 100 after its share price slid over the last few months. But research by Kantar Worldpanel earlier this week suggested Morrisons was the only one of the ‘Big Four’ supermarkets in growth, with sales up 0.1% in the 12 weeks to May 24.
That was echoed today by figures from fellow analysts Nielsen, which suggested sales were up 0.8% in 12 weeks to May 23, compared to flat sales at Sainsbury’s and substantial declines at Tesco and Asda. Nielsen said Morrisons was ‘currently on the right track’, with Mike Watkins, its head of retailer and business insight, suggesting steep price cuts were beginning to pay off.
Of course a swallow doesn’t make a summer, but if Morrisons continues to improve under Potts then shareholders should have substantially less to whinge about next year.