Product availability still recovering after tech outage, says Morrisons
Morrisons has said the availability of products in its stores has still not fully recovered after a major IT systems outage before Christmas.
The UK's fifth-largest supermarket chain said its recent turnaround progress was 'set back' by the issue, which has caused weaker sales growth in recent months.
Boss Rami Baitieh said the company was unable to see its product availability and stock levels for four days after a cyber incident hit its technology supplier, Blue Yonder.
'We found a work around very quickly but our availability fell significantly and we very sadly let down some customers,' he said.
'The incident did set back our progress.
'Our availability is improving but it is not yet back to where it was before the incident, although product availability is still better than we were a year ago.'
Chief financial officer Jo Goff said Morrisons expects to recover costs caused by the incident as it seeks to make a claim with its insurers.
The group added that sales for the current quarter, which covered the key Christmas period, were positive but saw slower growth than the previous quarter.
It came after Morrisons' sales jumped last year, with the supermarket saying it took market share from competitors and grew its loyalty card scheme.
The company said like-for-like sales rose 4.1% in the year ending October 27, while earnings jumped to £835 million from £751 million in the previous 12 months.
The annual results did not cover the key Christmas trading period, when Morrisons suffered IT issues of its own, causing delivery issues and forcing it to cut the price of items including turkeys and Champagne for some customers.
But the supermarket did show its best quarter since 2021 for the three months to October 27, when sales rose 4.9% compared with the previous year.
Morrisons, which has its headquarters in Bradford, West Yorkshire, and employs more than 100,000 people across the UK, has been owned by US private equity firm Clayton, Dubilier & Rice since 2021.
Mr Baitieh said: 'This has been a year of urgent reinvigoration and positive progress for Morrisons.
'Customer transactions increased, market share grew from Q2 and we saw positive switching from our competitors.
'The improvements across the business have resulted in better availability in our stores, sharper prices, more effective promotions and a strong and growing loyalty scheme.'
It comes after Morrisons said it would axe more than 200 jobs as part of a cost-cutting plan, joining Sainsbury's in reducing headcount in the months after the October Budget.
The move followed Mr Baitieh warning that supermarkets faced an 'avalanche of costs' after Chancellor Rachel Reeves increased taxes for employers.
Morrisons was one of more than 70 businesses, including Tesco, Asda and Sainsbury's, that told Ms Reeves in an open letter that the changes announced in the Budget mean price rises are a 'certainty'.
It said changes to national insurance contributions would push its costs up £75 million a year from April, with an extra £10 million of costs expected due to the impact of the changes on third party partners, such as security staff in its shops.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Wall Street Journal
5 hours ago
- Wall Street Journal
Mark Carney Says Canada Will Reach NATO Spending Target This Fiscal Year
Prime Minister Mark Carney announced a boost in Canada's defense budget and said spending would reach NATO's target of 2% of gross domestic product by the end of the country's fiscal year. Photo:
CNET
8 hours ago
- CNET
Nab the HP OmniBook X Flip 16-Inch Touchscreen Laptop for $550, Today Only
Even with tariffs raising prices on a number of items, including electronics, you don't have to spend wild amounts of cash to get a solid laptop. This capable HP laptop has a generously sized 16-inch LED touchscreen display with 1,920x1,200 resolution and 400 nits of brightness, making this an excellent laptop deal for those on a budget. Best Buy has slashed the price of the HP OmniBook X Flip 2-in-1 laptop down to just $550 right now. That's a massive $400 savings on its original price. The only catch? This one-day deal will end tonight or when stock runs dry, so we recommend getting your order in soon to lock-in this price. This laptop has an AMD Ryzen AI 5 processor, AMD Radeon 840M graphics, 16GB of RAM and 512GB of SSD storage, which should be plenty to cover all the basics and keep you productive whether you're using this laptop for work, school or scrolling and streaming. It also gets up to 21 hours of battery life per charge, depending on usage. Hey, did you know? CNET Deals texts are free, easy and save you money. And the 2-in-1 design means you can use it as a regular laptop or folded flat like a tablet, making it even more versatile. Note that this model does weigh in at over four pounds, which is the trade of for such a sizeable screen. If you're looking for something a little more portable or are looking for more storage, there is also a 1TB 14-inch model on sale. If you have a similar device you don't mind parting with, you may also be able to snag additional trade-in savings, too. Why this deal matters This deal knocks over 40% off the list price of this 2-in-1 laptop with ample storage and memory for most people. While you may want to opt for a model with stronger specs if you're a creative or a gamer, this is a pretty great option for most people looking for a large touchscreen for under a grand.
Yahoo
10 hours ago
- Yahoo
Reeves has left herself with only one way of funding her spending promises
This Wednesday, Rachel Reeves will be in the firing line once again. The event in question will not be a Budget, or even a mini-Budget, but rather a spending review. But such is the pressure on the public finances that the political and economic ramifications will be significant. On the face of it, this review is meant to spell out the details of departmental spending within the overall totals that have already been set to 2028/29 for current day-to-day spending and to 2029/30 for capital spending. Such reviews are not, therefore, meant to be the vehicle for announcing major changes in fiscal policy. There is now supposedly only one major fiscal event for this purpose, namely the autumn Budget, with a subsidiary event, the Spring Statement, which was delivered in March. That said, it would not come as a surprise if the Chancellor increased the spending totals on Wednesday. After all, if defence spending is increased to 3pc of GDP (costing over £17bn per annum by 2029/30) and spending on health increases by 3.4pc in real terms per annum, this would imply that other departments would have to suffer an average real terms reduction in their budgets of 1.8pc per annum out to the end of the review period. Good luck with selling that to the Labour Party. Admittedly, although at one point increasing defence spending to 3pc of GDP was supposedly a 'commitment', more recently it seems to have been downgraded to an 'ambition'. But any leeway you might think this gives is surely undermined by the fact that at last week's Nato meeting in Brussels, there was a call for defence spending of 3.5pc of GDP. And Donald Trump's representative called for the figure to be 5pc. Meanwhile, several recent policy announcements and events have come together to intensify pressure on the Chancellor. It will be interesting to see what she has to say about these on Wednesday and how they can possibly be squared with the existing plans. If she makes no announcements on these matters, then the detailed spending plans that she announces on Wednesday may be viewed as decidedly preliminary. Some of the fiscal pressures on the Chancellor reflect political choices. The Government has announced pay rises for public sector workers in England of between 3 and 5pc in this fiscal year, rather higher than the 2.8pc that the Chancellor had budgeted for. These higher increases will cost up to £3bn. It is no secret that the lurch by Reform UK towards Left-wing economic policies has driven the Government towards increased spending commitments. We don't yet know the full details, but if the Government were to fully reverse the cut to winter fuel payments, the cost would be about £1.7bn. Similarly, under pressure from both Nigel Farage and a significant number of its own backbenchers, the Government is reportedly considering removing the two-child cap on benefits. This would cost another £3.5bn. Meanwhile, a softening of the welfare cuts announced in March would probably cost a further £500m. On a different front, the Government's new migration policy is expected to reduce migration 'by up to around 100,000 per annum'. Whatever you might think of the desirability of such a change, the Office for Budget Responsibility (OBR) would score such a cut as reducing our GDP and thereby raising the likely level of public borrowing, perhaps by about £6bn by 2029/30. Not all the upward pressures on borrowing come from policy decisions. Since March, market interest rate expectations and gilt yields have risen. If this were sustained, then come the Budget in the autumn, another £4bn would have to be devoted to servicing the Government's debt. Over and above this, the OBR could conceivably reduce its forecast for productivity growth. Believe it or not, it has persistently been optimistic about productivity growth, only to be repeatedly proved wrong. At some point, it may well throw in the towel. A reduction of only 0.1pc per year would raise the annual borrowing forecast by about £10bn. The combination of spending increases of over £25bn and an upward revision to the OBR's borrowing forecast of just over £20bn would leave the Chancellor facing a fiscal 'hole' of about £46bn. Unlike before last year's Budget, she may well find this deficit trickier to blame on the previous Conservative government. The Chancellor might well find a bit of wiggle room by tweaking the fiscal rules. After all, in its most recent report, the International Monetary Fund suggested that there might be scope to go down this route. Nevertheless, it seems unlikely she would be able to raise more than about £20bn this way, leaving her with perhaps about £25bn still to find. And she needs to keep a watchful eye on the gilt market. As far as it is concerned, borrowing is borrowing. It is no surprise, therefore, that there is much speculation that huge tax rises are in the offing, perhaps including an extension of the planned freeze on personal tax thresholds by an additional two years, raising about £10bn. There are umpteen other potential personal tax measures that could raise substantial sums. Given that Reform has made much of being able to raise umpteen billions from ending the practice of paying interest on commercial banks' reserves at the Bank of England, however, it would be tempting to shoot their fox. Yet all these calculations assume a relatively small increase in defence spending. If we had to increase defence spending to 5pc of GDP, or even higher, surely the welfare budget would have to give. The Government must be hoping that President Putin's designs on Nato territory amount to just an 'ambition', rather than a 'commitment'. Roger Bootle is senior independent adviser to Capital Economics and a senior fellow at Policy Exchange. Broaden your horizons with award-winning British journalism. Try The Telegraph free for 1 month with unlimited access to our award-winning website, exclusive app, money-saving offers and more.
