12/03/2009

Morrisons' Sales Fuel Expansion Plans

The UK's fourth largest supermarket chain has reported bumper profits, and its revealed revenue will be plowed back into working capital for the business.

Morrisons boosted annual sales by 13%, smashing previous forecasts for the retailer. The firm has now said £500m will be redirected into funding expansion plans, rather than providing returns for shareholders.

Servicing around 10 million shoppers every week from over 380 stores, the company returned profits of £637m for the year ended February 1 - almost £10m high than expected.

In a statement, Morrisons said it expected the market conditions to get more challenging.

"In the current economic environment we expect the competitive landscape to be extremely challenging," said the firm, who went on to discuss investment plans.

"The board also believes that further investment opportunities may arise in the medium term and has therefore decided that the capital originally earmarked for share buybacks in the 2009/10 financial year should be retained within the business to give Morrisons maximum financial flexibility."

Morrisons, one of Britain's top five food manufacturers, raised its full-year dividend 21% to 5.8 pence a share.

(PR/JM)

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