Insight Report 3 minutes Premium

Morrisons (LON: MRW) FY16 Results: Sales Continue to Fall, but Cost Cuts Boost Bottom Line

Executive Summary

  • Wm Morrison (Morrisons) reported FY16 revenues of £16.12 billion, down 4.1% year over year and slightly below the consensus estimate of £16.16 billion.
  • Comps were down 2.0% but turned positive in the fourth quarter.
  • Gross margin fell by 70 basis points, but cost reductions and prior-year writedowns contributed to a 700-basis-point improvement in the SG&A margin. As a result, operating margin improved by 609 basis points; net profit turned positive, to £222 million, beating consensus; and diluted EPS of 9 pence met consensus.

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