(MENAFN- ProactiveInvestors) 's () commitment to lower prices largely seems to be confined to its share price as it issued another profit warning.
Shares were off 15% at 160p in early deals and at half the level at which they started what has been a tumultuous year as the company warned that it now expects full-year profits will not exceed £1.4bn.
That came as a shock to the market as disastrous though trading has been this year for the UK's biggest supermarket it had been leading the market to expect pre-tax profits of between £1.8bn to £2.2bn though the median forecast among analysts covering the stock was £1.49bn.
There will be a suspicion that new chief executive Dave Lewis is deliberately lowering expectations - a practice known in the City as "kitchen sinking" - so as to make it easier for him to point to success in his transformation programme further down the road.
The unscheduled trading update from placed heavy emphasis on the move to clean house and break with the practices of the past which saw overstate profits by £263mln earlier this year.
The company said that in recent weeks it has implemented new policies and procedures that will govern our commercial income activities and taken actions to invest in and improve its customer offer.
This is expected to lead to some short term pain but long term gain ... if all goes according to plan.
The company said its new approach "will underpin stronger long-term relationships with our suppliers benefiting customers whilst at the same time ensuring that revenue recognition is transparent and appropriate".
The company said it is ploughing money into staff training increased availability of key product lines and reduced prices and says early feedback from customers is encouraging.
Lewis criticised in the past by the City for not revealing to analysts (and his competitors) what his turnaround plan is is scheduled to reveal more on 8 January about the company's plans to improve its competitiveness in the UK and to strengthen its balance sheet.
"Whilst the steps we are taking to achieve this are impacting short-term profitability they are essential to restoring the health of our business. We will not engage in short term actions that compromise in any way our offer for customers" Lewis said presumably while sitting on a high horse.
"We still have much to do but are making good progress in developing our plans to improve the long-term positioning of the group and I will share more of that on the 8th January.
"Our priorities remain restoring competitiveness in the UK protecting and strengthening the balance sheet and rebuilding trust and transparency. For now all the team is focused on delivering the best Christmas for customers" he added.
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