Morrisons - making up for lost ground

A robust set of trading figures was delivered by supermarket group Wm Morrision, which saw an 18% rise in sales to £7.1bn in the half year to 3 August. Pre-tax profits jumped by 16% to £309m. Operating margins remained steady at 4.4%. Morrisons, which cautioned that trading is "getting tougher every day", has benefited from customers seeking value for money, attracted by special price-cutting promotions.

An additional 500,000 customers are visiting Morrisons' stores each week. Overall customer numbers are up by 4.7% with 300 stores refurbished and a new distribution centre set to open in Kent in 2010. The market thinks that Morrisons is being unduly pessimistic about the future. Dealers expect the sales and profit trends to continue upwards at the same rate as in the first half with second quarter sales showing a growth of 8%.

Citigroup expects 2009 profits of £613m vs £563m in 2008..