Morrisons declares special dividend as further growth spied

For the 52 weeks to 3 February, the group drove a 4.8% improvement in like-for-like sales, with total revenue up 2.7% to £17.7bn, with more than £700m from the recent push into wholesaling that is expected to top £1bn in coming years.

Profit before tax and exceptionals rose 8.6% to £406m, beating analysts expectations for £400m. Trading profit margins increased four basis points to 2.6% and the wholesale business contributed £12m of incremental profit.

Statutory PBT dropped 15.8% to £320m, after £86m of exceptional items.

Earnings per share, excluding exceptional, were up 8% to 13.17p, while free cash flow remained strong at £265m.

On top of final ordinary dividend of 4.75p that took the full-year ordinary dividend to 6.6p, the board pledged a special dividend of 4p, meaning the full-year total dividend rose 24.9% to 12.6p.

Net debt increased to £997m from £973m.

Chief executive David Potts said: "A third consecutive year of strong sales and profit growth, and a total annual dividend up over 150% during those three years, show the Morrisons turnaround is well on track.

"This turnaround is based on improving the shopping trip for customers, making Morrisons more popular and accessible."

On the outlook, Potts and co said there were confident that Morrisons "still has many sales and profit growth opportunities ahead, and expect that growth to be meaningful and sustainable", with free cash flow generation expected to remain strong.