Morrisons warns of price rises and bottlenecks as half-year profits fall 43%

Supermarket giant Morrisons has warned of a prospect of price hikes on groceries, as the UK braces itself for a major slowdown in economic growth the leading economists warn.

Statutory pre-tax profits were £six million, up from £145m in the same period last year.

Underlying pre-tax profits fell 37 per cent to £105 million, with the group blamed for a slump of £41 million in pandemic related costs and £80 million in profits lost at its cafés, gas stations and food-to-go shops.

Total sales rose nearly 4% over the period to £9.1billion, aided by a surge in online sales in the period and the wholesale at Morrisons.

An announcement from the Takeover Panel is set to emerge soon with a deadline set for the end of this month, at which point all bidders will have to make their final offerings.

Morrisons revealed the extent of delivery difficulties at Morrisons as profits in the first half of its financial year through August 1 were bolstered by more than £70million of cost overruns at stores.

The group had received bids for the business from takeover firms Clayton, Dubilier & Rice (CD & R) and Fortress, although the statement confirmed it recommended its offer of 285p per share, valuing the group at £7bn.

Morrisons shares on Thursday traded down nearly 293p to 155.5p, indicating investors were clinging on to hope of a counter - offer.