Morrisons reports 'solid start' despite sales fall

In March, Morrisons reported its first full-year pre-tax loss for six years

Morrisons, the UK's fourth largest supermarket chain, has reported a fall in underlying sales for the first quarter of its financial year.

Like-for-like sales, which strip out the effect of new store openings, excluding fuel fell 1.8% in the 13 weeks to 5 May,

However, total sales excluding fuel were up by 0.6%.

Morrisons said the results represented a "solid start" and "a steady improvement from the previous quarter".

Chief executive Dalton Philips said the horsemeat scandal had "helped drive increasing customer recognition of Morrisons' unique supply chain and approach to meat sourcing".

"They now understand that Morrisons is best placed to sell food that is what it says it is," he said.

The company said it was on track to meet its target of having 100 convenience stores open by the end of the year.

Morrisons also intends to launch an online offering before the end of 2013. It said it was still in talks with internet grocer Ocado about a possible tie-up.

At present, Morrisons is the only one of the "big four" supermarkets not to sell food online.

On Wednesday, Sainsbury's reported that about half of its sales growth had come from online and convenience stores.

In March, Morrisons reported a 7.2% fall in pre-tax profits to £879m for the year to 3 February - its first drop in full-year profits for six years.