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Morrisons' quarterly sales up strongly, slightly misses forecasts

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Morrisons' quarterly sales up strongly, slightly misses forecasts
A Morrisons supermarket is seen in Weybridge, Britain August 19, 2016. REUTERS/Peter Nicholls   -   Copyright  Peter Nicholls(Reuters)
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LONDON (Reuters) – Morrisons <MRW.L>, Britain’s fourth largest supermarket group, on Tuesday reported a 5.6 percent rise in quarterly underlying sales, though its rate of growth was slightly behind forecasts and a touch slower than in the previous period.

The Bradford, northern England, based grocer said total like-for-like sales, excluding fuel, rose percent 5.6 percent in the 13 weeks to Nov. 4, its fiscal third quarter – a twelfth straight quarter of underlying growth.

The performance compared to analysts’ average forecast of growth of 6.1 percent and growth in the previous quarter of 6.3 percent, which, helped by hot weather and the soccer World Cup, was its best sales performance in nine years.

Morrisons said it had expected a slight easing in like-for-like sales.

David Potts, chief executive since 2015, has overseen a steady improvement in trading through more competitive prices, improved product ranges and availability as well as better customer service in refurbished stores, pushing Morrisons’ shares 18.5 percent higher so far this year.

Potts has also overhauled Morrisons’ online strategy through a renegotiated agreement with distributor Ocado <OCDO.L> and struck wholesale supply deals with Amazon <AMZN.O> and the McColl’s <MCLSM.L> convenience chain.

Prior to Tuesday’s update analysts were on average forecasting an underlying pretax profit of 409 million pounds for the full 2018-19 year, up from 374 million pounds in 2017-18.

(Reporting by James Davey; editing by Sarah Young)

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