Morrisons Ditches Chief Executive in Quest for Growth

By Razak Musah Baba

LONDON--Wm. Morrison Supermarkets PLC (MRW.LN) said on Tuesday that Chief Executive Dalton Philips is stepping down after five years at the helm of the U.K.'s fourth-biggest supermarket group, which is seeking to regain earnings momentum.

Morrisons announced Mr. Philips departure as it reported a 1.3% fall in revenue, excluding fuel sales, in the six weeks to Jan. 4 compared with the same period last year. The company stuck to a forecast of pretax profit, discounting new-business development and one-off costs, in the range of 335 million pounds ($507.5 million) to GBP365 million in its current fiscal year, which runs to the start of February.

"In the next chapter of Morrisons' development, we need to return the business to growth," said incoming Chairman Andrew Higginson. "The board believes this is best done under new leadership."

Mr. Philips has agreed to continue in his role until the announcement of fiscal year-end results to ensure a smooth transition, Morrisons said. The company also said Chairman Ian Gibson will retire, as previously announced, to be replaced by Mr. Higginson, currently his deputy, on Jan. 22.

The U.K.'s "big four" supermarket chains--Tesco Corp. (TESO), Asda, part of Wal-Mart Stores Inc. (WMT), J Sainsbury PLC (SBRY.LN) and Morrisons--have been scrambling to retain their market share following the recent success of no-frills German rivals like Aldi and Lidl.

Morrisons, hit harder than the other retailers because it didn't offer online sales, tried to address that by announcing a deal in summer 2013 to offer food online in partnership with Ocado Group, an Internet grocer. The venture made its first delivery a year ago.

"Over the last five years, we have made many improvements to the business," Mr. Philips said in a statement.

Write to Razak Musah Baba at [e-mail]; Twitter: @Raztweet

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