Asda has reported a drop in total and like-for-like sales, but enjoyed its best like-for-like quarter in over a year. While now over, its IT upgrade also continues to affect product availability and will impact sales in the current quarter.
In a trading update for the second quarter, Asda reported that like-for-like sales were down 0.2%. However, this was an improvement, up 2.9% from the first quarter, which represented the grocer’s best quarterly like-for-like sales performance since Q1 2024.
Total revenues, excluding fuel, also dipped 0.2%. However, in fashion, George’s like-for-like sales jumped 2.5%, while in convenience, Asda Express stores outperformed the wider market, delivering 8.6% like-for-like growth.
In terms of strategic progress during the quarter, Asda extended Rollback price cuts to over 50% of products, with an average reduction of 22%.
Product availability in the period hit 96%, its highest level seen in eight years.
The long IT nightmare that has been Project Future was also completed during the period, with all Asda stores, food depots and head offices now operating on the new systems.
While the end of Project Future will come as a relief to Asda, executive chair Allan Leighton said the effects of the uneasy transition were still being felt.
He said: “We saw a clear improvement in performance during Q2, with volumes and like-for-like sales strengthening, driven by better product availability and our material investment in price. This widened the price gap over competitors and firmly re-established Asda as the best-value traditional supermarket.
“This week, we completed the rollout of Project Future, with all stores now operating on our new systems. The collective rate of completion did cause some temporary disruption with product availability and in our online experience, which will impact our sales outturn in the current quarter.
“As planned, we expect to exit the year in like-for-like growth as we continue our investment in price to protect our customers from inflationary pressures. As we’ve said from the outset, transforming Asda will take time, but we remain confident in the direction of travel and the long-term potential of the business.”
No comments yet