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LONDON -- Wm. Morrison (LSE: MRW.L ) released its third-quarter trading statement this morning, and with it the news that sales were lower than expected. Shares slipped marginally on the news at the time of writing, down 0.5% to 266 pence from yesterday's close of 267.5 pence.
The supermarket retailer announced that sales excluding fuel had decreased by 0.4% compared with the same period last year, while like-for-like sales excluding fuel had dropped 2.1%. (The figures including fuel were up 0.2% and down 1.3%, respectively.)
Management puts this down to the continued challenging trading environment, fragile consumer confidence, and "high levels of promotional activity a persistent feature of the market."
Morrisons has launched several initiatives to stay competitive against rivals Tesco and Sainsbury, including an online wine-cellar operation, Morrisons Cellar. Progress is also being made on its Own Brand relaunch, which will extend to 10,000 products, while the supermarket hopes to introduce its market-leading "Fresh Format" into 100 stores by the end of the financial year after a further 35 stores were targeted during Q3.
The statement continued:
While we are encouraged by the progress of these strategic initiatives, we recognise the ongoing importance of improving our performance, particularly in the communication of Morrisons key points of difference to our customers and in improving the effectiveness of our promotional activity. We have put in place a number of measures to enable us to achieve this.
We expect the market to remain challenging for the remainder of the year. However we continue to manage the business tightly and anticipate that our full year financial performance will be broadly in line with our expectations.
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