The group, which is behind market leaders Tesco , Sainsbury's and Asda in terms of annual revenue, maintained its full-year forecast but warned of some retail price inflation in the industry in the second half of the year, caused by a sustained rise in commodity prices and freight inflation as well as a current shortage of truck drivers.
In what is likely to be the last of Morrisons' publicly quoted northern England results, the company reported pre-tax profit and exceptional items of 105 million pounds ($144.5 million) for the six months to August 1, down from 167 million pounds ($230 million) in the same period last year.
Morrisons, which trades in 497 shops and employs more than 110,000 people, said direct costs for Covid-19 amounted to £41 million and profits of £80 million were lost in cafes, fuel and takeaway food outlets due to the pandemic.
Total revenue, including fuel, rose 3.7% to £9.05bn, with comparable sales excluding fuel and VAT down 0.3%.
Comparable sales fell by 3.7% in the second quarter, having increased by 2.7% in the first quarter.
The slowdown reflects the easing of pandemic hospitality restrictions, shifting demand away from the home food market.
"The entire Morrisons team has shown commendable resilience in facing many ongoing challenges during the first half of the year, including the ongoing pandemic, disruption to some of our supplier partners and the impact on our supply chain of a shortage of truck drivers," said chairman Andrew Higginson.
Morrisons has maintained its 2021-22 forecast for pre-tax profits and exemptions, including business rates paid, to be above the £431m generated in 2020-2021, excluding £230m of preferential rates.
Last month Morrisons, which began as an egg and butter seller in 1899, agreed a £7bn offer from Clayton, Dubilier & Rice (CD&R) , whose senior adviser is former Tesco boss Terry Leahy.
But a rival consortium led by Softbank-owned Fortress Investment Group could still outbid CD&R on the group, and a battle looks set to develop over the auction process overseen by the Takeover Panel, which regulates M&A in the UK.
https://exness1.org/ reports that the price of CD&R's latest offer is 285p per Morrisons share - a 60% - premium to Morrisons' share price before takeover interest emerged in mid-June. Fortress' latest offer was priced at 272 pence a share.
Morrisons shares closed at 292.4p on Wednesday, indicating that investors are hoping for a higher bid.