Morrisons warn customers could see a price hike in UK stores

Takeover target Morrisons has warned of pressure on prices due to the lorry driver shortage as it revealed that half-year profits tumbled.

The supermarket said it expects industry-wide retail price inflation in the coming months as a result of the HGV driver shortage, global commodity price increases and higher haulage costs.

But it said it will seek to reduce the impact of the cost pressures and supply issues to keep its shelves stocked.

Morrisons send warning over price increase

Chief executive David Potts said the group had seen price inflation start to come through over the past month, which is set to “continue for a while”.

He said: "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.

"We will seek to mitigate these and other potential cost increases, such as any incurred to maintain good on-shelf availability."

The comments came as the group posted a 43% fall in statutory pre-tax profits to £82 million for the six months to August 1, down from £145 million a year ago.

Underlying pre-tax profits fell 37% to £105 million, with the group blaming a hit from £41 million in pandemic-related costs, as well as £80 million in lost profit across its cafes, petrol forecourts and food-to-go.

When adjusted for the timing of business rates payments a year earlier, underlying profits rose 42% to £93 million.