SUPERMARKET group Morrisons is suffering a post-acquisition hangover as sales slump in its unconverted Safeway stores.

The chain, based in Bradford, warned that annual profits would be substantially below expectations.

North-East retail expert Anthony Platts accused the company of passing the buck, accusing Morrisons of being blind to Safeway shoppers being less price-conscious.

He said: "Blaming Safeway for the profit warning that now results from slashing prices looks like some rather flabby buck-passing.

"Safeway customers were never really that fussed about paying over the odds for their food, so wide-ranging price cuts were never going to be the golden bullet."

Morrisons bought Safeway earlier this year and immediately began a price-cutting mission.

But it said yesterday that sales had fallen, despite price cuts aimed at making the brand more competitive.

Stores already converted to the Morrisons brand were performing better than expected, while the core Morrisons outlets continued to perform well.

Mr Platts, assistant director at stockbrokers Wise Speke, said: "The profit warning has shaken the company's credibility, as the integration of Safeway stores has brought more problems than anticipated.

"What will make a difference is not simply lower prices, but converting these stores into Morrison units as soon as possible."

The main conversion programme will begin next month at a rate of three stores a week, with a total of 53 expected to be trading as Morrisons by the end of November. Recent industry figures highlighted the challenge facing Morrisons as Safeway sales suffered.

The latest trading statement showed that annual like-for-like sales at Safeway were down 7.2 per cent, or 8.9 per cent excluding petrol.

There were signs that the situation was stabilising, with same-store sales in the five weeks to June 20 down 6.9 per cent, compared with a fall of 13.8 per cent in the five weeks to May 16.

The four stores that have been converted to Morrisons saw sales increase by an average of 36.8 per cent, or 42.1 per cent excluding petrol, compared with the same period last year. Before conversion, trading at these sites was down 5.6 per cent.

Analyst Richard Ratner, at stockbroker Seymour Pierce, had previously expected annual pre-tax profits of £590m, but cut this to £410m in the light of the profits warning.