Morrisons, the British supermarket group, has appointed Rami Baitieh as its new Chief Executive, taking over from David Potts, a seasoned industry leader who served in the role for nine years. Rami Baitieh, previously at the helm of Carrefour France, assumes the position of Chief Executive.
On Wednesday, Morrisons announced that Baitieh will assume the role in November and will collaborate with Potts during a transitional period.
Potts spearheaded a remarkable transformation at the Bradford-based group in northern England. Under his leadership, the company navigated successfully through the challenges posed by the pandemic and bolstered its convenience store segment by acquiring McColl’s. Nevertheless, in recent times, Morrisons’ performance has fallen behind that of its prominent competitors.
Morrisons noted that Baitieh, who revealed his departure from Carrefour in August, boasts a track record of enhancing competitiveness, expanding market presence, and driving growth throughout his extensive tenure spanning over a quarter of a century with the French company.
In 2021, U.S. private equity firm Clayton, Dubilier & Rice acquired Morrisons for a sum of £7 billion (equivalent to $8.5 billion). This acquisition resulted in a substantial debt load for the company, which presently stands at approximately £5.4 billion.
With a market share of slightly less than 9% in the UK grocery sector, the company distinguishes itself from its primary competitors by maintaining its own production facilities. This means that it independently produces fifty percent of the fresh food it offers to customers.
“Rami will bring energy, innovation, and dedication to expanding Morrisons loyalty programmes and digital reach, while ensuring that the company’s long legacy of quality, and mission to deliver value for shoppers, is preserved,” Terry Leahy, senior advisor at CD&R, said.
Monthly industry statistics indicate that Morrisons is lagging behind its competitors, including the leading supermarket Tesco and the second-ranked Sainsbury’s. Furthermore, research conducted by Kantar revealed that last year, Morrisons lost its position as the fourth-largest supermarket in Britain by market share to the German-owned discount retailer Aldi.
Morrisons provided an update on its third-quarter trading up to July 30, noting a positive improvement in the trend.
The company reported a 2.9% increase in underlying sales, marking an improvement from the 1% growth observed in the previous quarter. Morrisons maintained its guidance for full-year core earnings, or EBITDA, to surpass the £828 million achieved in the 2021/22 fiscal year. Additionally, the company anticipates a year-on-year reduction in its debt levels.
Morrisons indicated that it was enhancing its competitive standing, as its price increases remained below the broader market rate, and it had bolstered its loyalty program. Additionally, the company reported achieving cost savings totaling £200 million in the current year.
“Although inflation has been uncomfortably high, there have also been some very welcome recent signs of a decrease in inflationary pressures,” said finance chief Jo Goff.