Asda operating profits jumped 6% to £857m last year despite its new convenience store business running up £31m losses.

Sales at Asda were £21bn last year while like-for-like sales, excluding petrol and VAT, rose 0.5%.

Online sales at Asda grew 10% across food, general merchandise and clothing, according to documents filed at Companies House.

The UK’s second largest supermarket acquired Netto’s UK business for £752m in 2010, giving Asda a strong foothold in the convenience market, which has proved a key battleground in the fight for spend.

The Walmart-owned grocer finished refurbishing and rebranding all 147 of the small stores to Asda by the end of last year. In accounts filed at Companies House, Asda said the former Netto stores made an operating loss of £31.4m on sales of £416m.

An Asda spokeswoman told The Guardian: “The [Netto] stores did incur a loss during the first year of acquisition, however, these losses were planned and reflected the costs of the integration and conversion costs.

“The stores actually traded ahead of expectations.”

The smaller stores gave Asda a 0.4 percentage points increase in market share to 17.3% in 2011.

In the directors’ report, Asda said 2011 had “continued to be a challenging period for the economy and consumers. In this context Asda had a successful year in continuing to build trust with customers who are increasingly selective about what they buy and where they shop.”

Asda last updated the market in August, when it reported a 0.7% increase in like-for-like sales for the second quarter of 2012. The performance was strong against its competitors, but did represent a slowdown on the first quarter, when Asda posted a sales rise of 2.2%.