CE''s departure will not slow Morrisons'' success.

Byline: Iain Laing

SUPERMARKET chain Morrisons has vowed not to let the shock departure of its chief executive blow the firm off course as it revealed quarterly sales growth in the face of a slowdown in food price rises.

The retailer said like-for-like sales, excluding fuel and VAT, were up 4.3% in the 13 weeks to November 1, compared to 7.8% growth in the first half, having already warned that easing food inflation would result in a slowdown.

Group finance director Richard Pennycook said the announcement that chief executive Marc Bolland was to leave for rival Marks & Spencer was "very new news" for the retailer.

He said Mr Bolland's tenure had been a productive one for the company and described working with him as "delightful". "We think we have had a pretty good run and there's more to come," he said.

"He has been a great member of the team and we are sorry to see him go. But it is a team here and we won't miss a beat over Christmas."

Total sales - excluding fuel and VAT - were up 9.1% in the quarter.

Mr Bolland said: "Morrisons continues to grow ahead of the market driven by our award-winning combination of outstanding quality, fresh food and great value."

Recent industry data from research group TNS Worldpanel suggested Morrisons grew faster than other names in the industry in the 12 weeks to November 1. The supermarket's 8.5% till roll growth in the period compared to a 4.7% increase for Tesco and 6.6% for Asda.

In terms of market share, Morrisons was in fourth place, with 11.7%, compared to Tesco's 30.7%, Asda at 17.3% and Sainsbury's at 15.9%.

Morrisons' shares sank more than 5% yesterday on the news of Mr Bolland's departure. The 50-year-old Dutchman has been credited with reviving Morrisons since he joined the Bradford-based business in September 2006.

The group has been a star performer in the supermarket sector throughout the recession as its value-for-money offer attracted hard-up consumers.

Mr Pennycook indicated he would think about putting himself forward for the top job at the firm, but said it was too early to say for certain.

Richard Hunter, head of UK Equities at Hargreaves Lansdown Stockbrokers, said: "Inevitably, the update is overshadowed by yesterday's announcement, which has resulted in some share price weakness as a replacement chief executive is sought.

"Nonetheless, the incoming person at the helm will inherit a steady ship."

He said the supermarket had enjoyed a "particularly robust year" and said much of the recent slowdown in growth is due to lower food inflation, which has affected the whole industry. "At a headline level, the continuing focus on cost efficiencies, coupled with another surge in customer numbers, will serve the company well," he said.

The supermarket chain said it had received a record 10.8 million customers on average through its doors each week during the period.

Sales growth was helped by the contribution from 37 stores opened so far this year as the firm ratchets up expansion plans and consolidates stores bought from the Co-operative group following its takeover of Somerfield.

CAPTION(S):

STAYING ON COURSE Morrisons vow to keep forging ahead in market.