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Last Updated: Thursday, 26 May, 2005, 10:59 GMT 11:59 UK
Morrisons boss survives rebellion
Morrisons chairman Sir Ken Morrison
Sir Ken has had to give four profits warnings since buying Safeway
Morrisons shareholders have voted to re-elect Sir Ken Morrison as chairman, but a sizeable minority rebelled.

At the supermarket group's annual general meeting (AGM), Sir Ken secured 80.3% of the vote, with 10.7% voting against and the remainder abstaining.

Sir Ken has been facing opposition because the firm has announced four profit warnings since its 3bn takeover of rival Safeway in spring 2004.

Critics have also called for the firm to appoint more independent directors.

Lesser role

Before Thursday's AGM, Morrisons announced that Sir Ken was to step back from day-to-day decision making at the company.

The chairman has previously stated his commitment to seeing through the integration of Safeway, and this remains the case
Morrisons statement

He will stay as chairman of the plc board, which meets once a month, but will no longer be on the operations board which meets weekly to make key decisions.

Morrisons said he would stay with the company for at least another year.

The Bradford-based firm warned earlier this month that 2005 profits would be below 2004 levels, as it continued to struggle to incorporate the former Safeway network into its business.

In October last year, Morrisons criticised the previous directors at Safeway for introducing a new accounting system four weeks prior to the takeover.

This was said to have greatly complicated bringing the two companies together, in addition to merging the two separate product lines and distribution networks.

Before last year's takeover of Safeway, Morrisons had never had to issue a profit warning.

New directors

In a trading statement issued on Thursday morning ahead of the AGM, Morrisons said total like-for-like sales excluding fuel were up 2.3% for the 15 weeks to 15 May.

Morrisons store
Morrisons has found converting Safeway stores challenging

But like-for-like sales excluding fuel for the original Morrisons stores were down 2.3%.

Sales at the former Safeway stores which have been converted to the Morrisons name were up 12.5%, while the Safeway stores awaiting conversion saw sales rise 3%.

The company is now in the process of looking for four non-executive directors in a bid to make its board more accountable.

Morrisons also announced that it had appointed Richard Pennycock as its new finance director.

Mr Pennycock, who is currently group finance director of the RAC, will join Morrisons on 1 October, the company said.

The chain's previous finance director, Martin Ackroyd, quit in March.

Morrisons said that although Sir Ken was taking a less hands-on role, he would remain a key member of the board.

"The chairman has previously stated his commitment to seeing through the integration of Safeway, and this remains the case," it said.

The company added that, because of the problems caused by the integration of the Safeway chain, it would be unable to give guidance on this year's full annual profits until its half-year results are published in October.

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26 May 05 |  Business
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13 May 05 |  Business
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23 Mar 05 |  Business
Morrisons issues profit warning
17 Mar 05 |  Business
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11 Jan 05 |  Business
Morrisons sells 114 Safeway shops
25 Oct 04 |  Business

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