Asda pleased with sales progress

British supermarket chain Asda today said it had achieved “very positive” quarterly results, despite the impact of a more difficult retail environment in the UK.

The group, which is part of US giant Wal-Mart, said like-for-like sales were in the low single digits in the three months to October 31, with the addition of eight new stores ensuring total sales reached mid-single digits.

While sales growth has been impacted by market conditions and tougher comparables, Asda’s market share improved to 11.8% in the 12 weeks to October 7. Operating income was slightly above plan, but below last year.

Asda’s chief executive Andy Bond, who is two years into an improvement plan, said the company’s pricing strategy was paying off.

Mr Bond said: “We’ve cut 30,000 prices so far this year and customers are voting with their feet. An extra three quarters of a million of them are coming through our doors because they know that when it comes to value there really is no place like Asda.”

Asda’s performance will be given greater context on Wednesday when rival Sainsbury publishes its half-year results.

Asda operates from 345 stores in total, including 13 Asda Living shops and 12 George high street outlets. It will soon launch its Christmas advertising campaign, starring actress Julie Walters in 15 documentary style ads.

Mr Bond added: “With interest rate rises and the increased cost of Christmas customers are feeling the pinch but retailers should stop blaming this, wet weather or consumer confidence for their sales performance.”

Asda did not provide exact sales figures as part of an update accompanying figures from Wal-Mart today.

Wal-Mart posted third-quarter earnings of $2.86bn (€1.95bn), an 8% rise that beat Wall Street expectations.

Chief executive Lee Scott said it has been a tough year for consumers, but that the company’s new focus on pricing was paying off. He added: “We believe we are well positioned to win in this environment.”