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Morrison's founder lambasts chain’s management

Sir Ken Morrison has launched an outspoken assault on the management of the supermarket chain he built up, saying its chief executive was talking "bullshit".

Sir Ken, who was at the helm of the company for more than 50 years, told chief executive Dalton Philips at Wm Morrison's annual meeting in Bradford that although he kept cattle, "You have a lot more bullshit than I do." He said the group's losses were "disastrous" and said it had failed to run its core supermarkets well.

MORRISONS EARNINGS
Chris Ratcliffe | Bloomberg | Getty Images

"There's no strategy," said Sir Ken, whose family still owns close to 10 percent of the company.

He questioned the competence of the entire board. "What makes you believe you will be any better at running convenience stores than you are at core stores? I do not see any sign that you can," he said before sitting down to loud applause.

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Sir Ken transformed his father's three egg-and-butter market stalls in Bradford into the UK's fourth-biggest supermarket chain by market share before retiring in 2008.

His attack follows a slump in sales and profit at Morrison, once one of Britain's best performing supermarket chains. The company issued a severe profit warning in March, after saying it would put £1 billion ($1.68 billion) into lowering prices.

The Morrison family voted against the re-election of Sir Ian Gibson, chairman, and Mr Philips, according to people familiar with the situation. However, they won 89 and 86 percent of the vote respectively with 98 percent of the vote counted.

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Big investors also expressed some discontent on pay, with 27 percent voting against the new remuneration policy.

Sir Ian rebuffed Sir Ken's attack, saying that over the past four years the group had returned billions to shareholders and outperformed its peers. He will not seek re-election at the company's annual meeting in 2015, Morrison said on Thursday.

Sir Ian said the group's woes were partly because it had been late developing online and convenience offerings, the only growing sectors of grocery retailing. Sir Ian also apologized to shareholders for "disappointing" results. He said that it was a "mistake" to buy 10 stores along with an online business from Kiddicare, a baby goods retailer it is now looking to sell.

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Mr Philips told journalists he had a longstanding difference of view with Sir Ken, but was driving change that would deliver results. He said he was confident he could return Morrison to a "winning streak" with price cuts, IT investment, the expansion of its online delivery service, convenience stores and the introduction of a loyalty card.

Several other shareholders among the 200 or more attending the meeting rose to attack the directors. They said the group had changed strategy too many times and mistakenly gone upmarket. One employee said morale was low after changes to shift patterns and proposed redundancies.