Bradford-based supermarket giant Morrisons has warned that its sales and core profit for the year could be hit by the war in Ukraine and rising inflation unless conditions improve.
“We believe that the developments in the geopolitical environment since the beginning of February 2022 as well as ongoing and increasing inflationary pressure is impacting consumer sentiment and spending, which we expect to adversely impact the wider grocery market as well as our performance while these conditions persist – we are unable to predict how long that will be,” said Morrisons.
“We believe that these developments have had an impact on sales and EBITDA since the beginning of February 2022.
“We are taking steps to mitigate the impact of these developments on our EBITDA for the remainder of the year.
“Unless these conditions improve, the impact of these developments could have a material adverse effect on our sales and EBITDA for the year.”
In an update for investors, Morrisons reported adjusted EBITDA of £941 million for the year to January 30, 2022.
Last month, the UK’s Competition and Markets Authority (CMA) told US private equity firm Clayton, Dubilier & Rice (CD&R) it must address CMA concerns that its £7.1 billion purchase of Morrisons could lead to higher fuel prices to avoid an in-depth investigation of the deal.
CD&R is the owner of the Motor Fuel Group (MFG), the largest independent operator of petrol stations in the United Kingdom with 921 fuel stations, while Morrisons operates 339 petrol stations.