Asda sales rise for fourth consecutive quarter

The grocer enjoyed a 3.4% increase in like-for-like sales during the 13 weeks to March 31, while total sales grew 3.7%.

Stripping out the impact of the earlier Easter, like-for-likes were up 1%.

Despite the sales increase, profits fell during the period as Asda continued to inject investment into improving its proposition.

It launched 216 new own-brand products during the period and improved the quality of a further 140.

Asda also ploughed cash into lowering prices, with its ‘Rolled Back Staying Back’ campaign extending to 667 SKUs.

The Walmart-owned grocer posted its first quarterly sales rise for three years last summer, as like-for-likes climbed 1.8% in the 13 weeks to July 28, ending a run of sales decay stretching back 11 consecutive quarters.

The supermarket giant followed that up with a 1.1% uplift during the 12 weeks to September 30 and a 0.5% increase in the final three months of 2017.

Merger with Sainsbury’s

Details of its ongoing sales momentum under boss Roger Burnley come weeks after Asda and its big four rival Sainsbury’s unveiled plans to merge in a £13bn mega-deal that shocked the City.

Asda owner Walmart will retain a 42% stake in the enlarged business, should the tie-up receive regulatory approval.

Burnley reiterated today that the landmark merger would allow the grocer to “accelerate” its strategy and “go further, faster”.

He added: “Our Q1 performance – even when adjusted for increased sales from an early Easter – represents genuine momentum with four consecutive quarters of growth.

“During the first three months of the year, we have continued to invest sensibly where it matters most to our customers with lower prices, innovation in our own-brand and further improving their shopping experience whether in-store or online.”

Walmart chief executive Doug McMillon said: “Recently, we took some strategic actions to further position our portfolio for long-term growth.

“We were pleased with the response of our colleagues in the UK following our announcement of the proposed merger of Asda with Sainsbury’s. We believe this proposed combination is good for customers and colleagues as well as shareholders.”

McMillon said Walmart remains focused on “improving the customer experience in our stores and providing value for customers by investing in lower prices”.

That strategy has borne fruit for Asda thus far, but it has also made moves to restructure and streamline its operations in the midst of rising costs, including the national living wage, the apprenticeship levy and business rates.

Last September, Asda revealed it was swinging the axe on 300 roles across central operations at Asda House in Leeds and George House in Leicester.

And in December, the grocer said more than 800 section leader roles would be stripped out of stores as it simplified store management structures.