Morrisons continues to see sales fall

Morrisons said it closed more stores than it opened during the first quarter of 2015

Morrisons has continued the recent run of bad news from the major supermarket chains by reporting another fall in sales.

Like-for-like sales excluding fuel fell 2.9% in the three months to 3 May, a worse performance than the previous quarter when sales dropped 2.6%.

The news saw shares in Morrisons close down more than 6%.

Morrisons is the UK's fourth-largest supermarket chain, trailing Tesco, Asda and Sainsbury's in annual sales.

Its struggles reflect wider problems in the sector, which has seen fierce price competition following the growth of discount chains such as Aldi and Lidl.

Recent results from both Tesco and Sainsbury's were depressed by a downward revaluation of how much their properties were worth.

On Wednesday, Sainsbury's reported its first full-year loss for 10 years, while Tesco announced a record annual loss last month.

'Eager'

This is the first interim management statement since David Potts took over as chief executive officer on 16 March.

Mr Potts was picked to replace Dalton Philips, who announced his departure in January after five years at the helm of the Bradford-based firm.

"My initial impressions from my first seven weeks are of a business eager to listen to customers and improve," Mr Potts said.

The company said it closed more stores than it opened during the quarter, and it has also announced plans to cut 720 jobs at its head office in Bradford.

It said that "simplifying" the head office would cost it £30-40m this year.

Morrisons said a full assessment of the business was under way, and it would give more details when it releases its half-year results in September.

It added that it anticipated underlying pre-tax profits would be higher in the second half of its financial year than the first.

In March, Morrisons said underlying full-year profits had more than halved to £345m, its worst results in eight years.

After taking account of a £1.3bn write down in the value of its supermarkets, it reported a statutory loss of £792m.