Morrisons thrives in tough climate

10th Mar 2011 07:07

Supermarket Morrisons beat expectations in 2010 as its reputation for value had hard-pressed shoppers flocking to its stores.Underlying pre-tax profits totalled £874m for the year, ahead of estimates and up from £767m the previous year. Turnover climbed by 7% to £16.5bn. Morrisons says it will buy back £1bn of shares over the next two years and implement double-digit percentage growth in dividend payments over the next three years."In a difficult consumer environment, increasing numbers of customers have recognised the great value and quality of our offer and we have again delivered record profits," chairman Sir Ian Gibson said. "We have ambitious plans to take Morrisons' unique offer to more customers through our accelerating new store programme and through the development of new channels."Morrisons expects higher taxes, government spending cuts, inflation and rising unemployment to continue weighing on consumer confidence in 2011, but says its value offering leaves it well positioned to deliver further profit growth.The company has been spreading its wings recently, announcing plans to move into the convenience store and online areas. The first trial convenience store will open in July. Morrisons announced the acquisition of babycare online retailer kiddicare.com for £70m last month. It has also invested £32m on a stake in FreshDirect, an online grocer serving New York.