Morrisons tipped to be star of Christmas

Published on Saturday 19 January 2008 16:28

MORRISONS, the supermarket chain promoted by Lulu and Alan Hansen, is this week expected to take the crown as the most successful food retailer over Christmas.

The family business is thought to have stolen a march on its rivals Tesco, Asda and Sainsbury's and is expected to reveal the biggest like-for-like sales growth of the season.

Analysts expect these to have risen by as much as 7% during the six weeks to January 6 after the latest research from TNS Worldpanel showed the group increased its market share from 11% to 11.4% last month.

Last week Tesco finance and strategy director, Andrew Higginson, confirmed that Morrisons had stolen ground from its competitors when he told the markets: "Morrisons had a better Christmas than everyone".

Tesco revealed below forecast sales growth of 3.1%.

Clive Black, retail analyst at Shore Capital, said: "Morrisons should confirm that it has been the food retail star for 2007, at least in terms of like-for-like sales growth. Morrisons' chief executive Marc Bolland has demonstrated his strong marketing credentials with excellent advertising, backed up by the ongoing outstanding store execution and a major promotional campaign."

Analysts at Goldman Sachs said: "The refreshing of new stores this year and the aggressive advertising campaigns over the past three months appear to be gaining traction with customers."

The results will be viewed as a turnaround for the chain, the fourth largest in Britain, after it struggled to integrate Safeway, the company it bought for 3bn in 2004. The problems led to a string of profits warnings in 2005 and last year Morrisons was forced to post the first loss in its 106-year history.

John Kershaw, analyst at Merrill Lynch, said: "Let's not get too carried away, yet. Morrisons' message may be better but its stores, systems and offer still require work."