* Q1 underlying sales growth slows to 2.7%
* Group faced tough comparative
* Maintains full year profit forecast
(Adds detail, CEO comment, shares)
By James Davey
LONDON, May 11 (Reuters) - British supermarket group
Morrisons expects the relaxation of pandemic
restrictions on socialising and major sporting events, including
soccer's Euro 2020 and the Olympics, will drive another boost to
sales this summer.
Chief Executive David Potts said Britons' rising optimism
over much reduced COVID-19 cases, the success of the vaccination
programme in the UK and an improving economy would encourage
them to socialise and celebrate.
"That sense of optimism is percolating through the country
and it will lead to people wanting to celebrate events," he told
reporters on Tuesday.
"We'll be doing everything we can to be part of that," he
said, pointing to a potential boost to trade from families
getting together in bigger groups, and high demand for barbecue
food, pizzas and beer.
Morrisons reported a slowdown in quarterly sales growth as
it compared with exceptionally busy trade a year earlier when
Britain's first COVID-19 lockdown prompted panicked shoppers to
send sales soaring.
The group, which trails market leader Tesco,
Sainsbury's and Asda in annual revenue, said
like-for-like sales, excluding fuel, rose 2.7% in the 14 weeks
to May 9, its fiscal first quarter - ahead of analysts' average
forecast of up 1.6% but down from growth of 9.0% in the previous
quarter.
Retail sales rose 1.6%, wholesale sales were up 1.1% and
online sales more than doubled, partly driven by a partnership
with Amazon.
Comparing the period with 2019, before the pandemic started
to disrupt trading last year, group like-for-like sales rose
8.7%.
Shares in Morrisons were up 0.7% at 0811 GMT.
"The pandemic is not yet over, but it is in retreat across
Britain and there is much to be positive about as something
approaching normal life begins to take shape," said Potts.
He noted that Morrisons' petrol forecourts were getting
busier, and it was seeing encouraging recent signs of a strong
rebound of food-to-go, take-away counters and salad bars. Its
cafés will fully reopen on Monday when Britain is due to ease
restrictions on indoor hospitality.
The group maintained its forecast for 2021/22 profit before
tax and exceptionals including business rates paid to be higher
than the 431 million pounds profit achieved in 2020/21,
excluding the waived rates relief.
It also said it would reduce debt and forecast another year
of "meaningful profit growth" in 2022/23.
Morrisons said it would refresh its long-term capital
allocation plans when it reports interim results in September.
(Reporting by James Davey; Editing by Kate Holton and Susan
Fenton)
