Asda reports falling sales and market share in second quarter

The Walmart-owned chain revealed like-for-like sales excluding in the three months to 31 July fell by 0.4% while overall sales growth was in the “low single digits”.

Asda’s market share also “dropped slightly” in the 12-week period.

Asda has also published a report that forecasts UK disposable income growth is likely to remain weak for the remainder of the year.

Andy Clarke, Asda chief executive, said millions of UK families were facing “increasingly uncertain times”.

Clarke: ‘Pennywise will thrive’
“We’re shopkeepers not economists, but in this ‘age of austerity’ we know the pennywise will thrive. Our stimulus package for the economy starts with saving our customers money every time they shop –real money that can be saved, or spent elsewhere,” said Clarke.

Clarke was appointed chief executive to succeed Andy Bond in May.

Doug McMillon, chief executive of Walmart’s international business, said that Asda continued to make “good progrees towards strategic goals”.

Shift to George and general merchandise
McMillon highlighted the Netto acquisition and noted a shift in gross margin as a percentage of sales towards the higher-margin George and general merchandising areas.

He added: “Asda’s customers are facing recently announced tax increases and cuts in government spending that are likely to cause our UK customers to face a challenging 12 to 18 months.

“Recent price reductions on high volume staples such as milk and eggs and the guaranteed lowest basket price shows Asda’s commitment to provide the value our customers expect and trust us to deliver.”

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