Morrisons’ losses hit £381m after steep debt costs
I'm LongbridgeAI, I can summarize articles.Morrisons reported a £381m loss for the last year, primarily due to high borrowing costs and reduced consumer spending. The grocer's debt interest reached £281m, impacting profitability. Despite the loss, net debt decreased to £3.1bn from £3.5bn. CEO Rami Baitiéh noted challenges from inflation and a declining grocery market, with like-for-like sales down 2.4% in the last quarter. Morrisons faces competition from Lidl, which is closing in on its market share. Baitiéh emphasized the need for government support to avoid further cost increases.
Morrisons plunged to a £381m loss last year as it battled steep borrowing costs and weaker consumer spending.
The private equity-owned grocer revealed that its debt interest bill hit £281m in 2025, derailing attempts to turn a profit.
Despite ending the year once again in the red, bosses hailed a drop in net debt to £3.1bn, down from £3.5bn last summer.
The retailer’s initial results announcement also did not include any mention of the £381m loss. Joanna Goff, the chief financial officer, only revealed the figure when pressed during a subsequent media call on Wednesday.
She said this was a £33m improvement on last year, while also pointing to £835m of so-called adjusted earnings, which strip out interest costs and tax.
Morrisons has been battling elevated debt costs since its £10bn takeover by private equity firm Clayton, Dubilier & Rice (CD&R) in 2021.
It has been working to reduce its debt bill by selling off some of its supermarkets before leasing them back.
The latest figures covered what Rami Baitiéh, Morrisons’ chief executive, described as a “challenging period”.
He said: “We saw the impact of the government cost increases, with inflation and Budget uncertainty all weighing on customer sentiment.”
Mr Baitiéh said the overall grocery market had been in decline towards the end of its financial year, which ends in October.
Morrisons’s like-for-like sales fell by 2.4pc in the three months to the end of October but were up 2.8pc over the year as a whole. Yearly revenues were up 3.2pc to £15.8bn.
Mr Baitiéh said Morrisons also had more pensioners and less wealthy shoppers in its stores, meaning they were more sensitive to price pressures.
Mr Baitiéh urged the Government to avoid hitting retailers with any extra costs to help keep prices down.
“I would say, please, no more. This is very important for the market. We expect inflation to go up,” he said.
The figures will fuel speculation that Morrisons could soon be set to lose its position as Britain’s fifth biggest supermarket.
Lidl has been gaining ground on Morrisons in recent months, with Worldpanel figures suggesting it held 8.1pc of the grocery market compared to Morrisons’ 8.3pc in November.
Mr Baitiéh argued that the Worldpanel figures did not include its growth in convenience stores, where it has been expanding in recent months.
He said Morrisons was “happy with our like-for-like” figures in larger supermarkets, adding: “When we look at Morrisons, we are addressing the price, we are addressing the promotions, we are addressing the loyalty, we are addressing the availability.”