Asda sales and profits increase as it continues focus on growth

In the full year to December 31, 2023, underlying profit exceeded £1bn and like-for-like sales grew 5.4%.

Sales excluding fuel increased by 7.1% year on year to reach £21.8bn, while adjusted EBITDA after rent surged 24% to £1.07bn.

The grocer said sales grew as customers responded to its “ongoing investment in value last year” as well as through the “toughest times of the cost-of-living crisis”.

Its clothing brand George saw sales increase by 3.4% to £1.5bn. 

Asda also said it had made “significant strategic progress” by taking full control of 116 convenience stores from the Co-op and acquiring 356 predominantly freehold sites from EG Group’s UK business.

The retailer is on track to have 500 Express stores open by the end of this year and its commitment to growth has continued into 2024.

The results arrive amid news that co-owner Zuber Issa is expected to sell his £500m stake to majority shareholder TDR Capital.

Asda co-owner Mohsin Issa said: “Asda is a supermarket powerhouse built on rock-solid foundations – as our strong annual results and the 18 million customers who shop with us every week demonstrate. 

“Our strategy is all about growth and Asda increased underlying profit to more than £1bn and like-for-like sales by over 5% last year, while significantly growing free cash flow and reducing leverage. We are committed to doing the right thing for customers, colleagues and local communities – and are putting in place the strategic building blocks to set up Asda for long-term success.

“As well as investing in price to maintain our position as the cheapest traditional supermarket, we continued to invest in further enhancing the quality of our products, building on the earlier successful launch of the budget-friendly Just Essentials brand with a significant own-label transformation programme.

“This saw us launch thousands of new and improved food lines to drive quality perception among consumers, including a refresh of our entire ready meals range.

“This investment includes non-food and saw George maintain its market leadership position in back-to-school wear and deliver total clothing sales growth of 3.4% last year – helped by our ongoing focus on price, quality and style.

“We continue to strengthen the business by expanding in the growing convenience and food-to-go sectors,  leveraging our loyalty app and driving innovation in online grocery where we are the UK’s second-largest supermarket.”