Shares of convenience retailer McColl’s plunged by up to a third to hit record lows after it warned that weak product availability due to supply chain crisis would hit annual profits.
McColl’s, which has a network of 1,265 convenience stores and news agents across the country, declared recently that a shortage of lorry drivers and insufficient supply of key products intensified in the final quarter of its financial year.
It did not provide any figures on the extent of the fall in exected sales though mentioned it would be “significantly lower”. The company told investors it was working with its wholesale partner, Morrisons, to restore product availability and it was easily on track to convert 350 stores to their Morrisons Daily format by this time next year, reports said.
“While we continue to work collaboratively with our wholesale partner, Morrisons, to lessen the effect of the disruption, we have been unable to fully mitigate the impact to stores, leading to significantly lower revenues than initially anticipated,” it said.
Chief executive Jonathan Miller said, “It is disappointing to see supply chain issues worsen through the second half, but external factors have not eased, and continue to impact much of the UK economy.
“Despite these supply chain issues, I am delighted by the step change we are witnessing in store performance from our Morrisons Daily conversions.
This new format is showing strong sales growth and is delivering better return on investment than we expected. Our conversion programme is moving at pace, ahead of time and on budget, and we anticipate reaching 350 Morrisons Daily stores well in advance of our original target,” he said.
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