Morrisons is in discussions with Tesco over comparisons made in its Price Promise promotion after claiming a third of the comparisons made are unfair.

Morrisons chief executive Dalton Philips said it will complain to the Advertising Standards Authority if talks fail but it is yet to make a formal complaint. Sainsbury’s has already made a formal complaint over Tesco’s promotion which compares the prices of branded and own label products with rivals.

Philips said: “We are in discussions with Tesco over it. We find it challenging when one third of the basket is not successfully compared. We are not sure that that’s the right message to be out there.”

Last month Morrisons customer director Crawford Davidson said: “Tesco’s Price Promise provides a false assurance that it will compensate customers when Morrisons is cheaper, which it mostly is.”

Philips spoke as Morrisons today revealed a 1.8% fall in first quarter like-for-like sales. However, it said fresh food sales have benefitted after rivals were hit by the horsemeat scandal – fresh beef sales were up 2% in the quarter while fruit and veg sales rose 4%.

The grocer said it was still in discussions with online grocer Ocado over its intellectual property ahead of a scheduled online grocery launch next year.

Morrisons finance director Trevor Strain said that the online grocery launch is “not dependent” on Ocado but discussions were “too commercially sensitive” to give a prognosis on their possible outcome.

Philips said that Morrisons is working to “change the weather report” after facing “headwinds” in online and convenience growth.

Philips added the grocer is close to confirming the location of a second warehouse to support its growing Morrisons M Local convenience arm. He told Retail Week it will be open before the end of the year and is not in its Yorkshire heartland.