The HGV driver shortage is combining with commodity inflation to bring expected food price rises in the coming months, Morrisons has warned.
The supermarket unveiled its half-year results today (9 September), and chief executive David Potts said current conditions were putting pressure on shelf prices. 'We expect some industry-wide retail price inflation during the second half, driven by sustained recent commodity price increases and freight inflation, and the current shortage of HGV drivers,' he said. 'We will seek to mitigate these and other potential cost increases, such as any incurred to maintain good on-shelf availability.'
Morrisons revealed that total revenue including fuel was up 3.7 per cent to £9.1 billion in the six months to 1 August, but group like-for-like income excluding fuel and VAT fell 0.3 per cent.
The retailer said it expects 2021/22 pre-tax profits to be higher than the £431m it would have posted in 2020/21 had it not waived £230m in business rates relief.
It has been another strong period for online sales, which rose 48 per cent, while wholesale income was up 18.1 per cent, both on a like-for-like basis.
This year has also seen an acceleration of the Morrisons Daily rollout with McColl's, with 350 store conversions expected by November 2022. 'Morrisons on Amazon' has been expanded to over 60 towns and cities, and the retailer is also supplying Amazon Fresh UK stores.
'Across the business the whole Morrisons team has shown commendable resilience facing into a variety of continuing challenges during the first half, including the ongoing pandemic, disruption at some of our supply partners, and the impact on our supply chain of HGV driver shortages,' said chairman Andrew Higginson. 'As we approach our busiest time of year, I'm confident the team will continue to rise to all challenges and keep up all the good work to improve the shopping trip for customers.'