Asda sales slow as it forecasts a bleak Christmas

 
Kasmira Jefford
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ASDA, the UK’s second largest supermarket, reported a slowdown in third quarter like-for-like sales growth yesterday and struck a sober note in its outlook on the Christmas quarter.

Like-for-like sales rose 0.3 per cent in the three months to 30 September, down from 0.7 per cent in the previous quarter and 2.2 per cent in the first quarter of the year.

But the rise means it has outperformed rival grocers Tesco and Morrisons in the same period.

“These are solid results in a tough market,” said chief executive Andy Clarke, adding that Asda had increased its market share by 0.1 per cent to 17.5 per cent over the year.

Clarke said while he was surprised at the UK’s economic improvement in the third quarter, “it did not translate in a big way” into customers’ pockets.

He said that a recent survey of its customers showed they were on average £13 per week worse off than two years ago. He also warned that Christmas would be tough for consumers and joined calls for chancellor George Osborne to scrap a planned hike in fuel duty.

Clarke refused to comment on criticism this week of US multinationals paying low corporate tax. He said Asda paid “a significant amount” of tax which amounted to £163m last year and £886m over the last five years.

US parent company Wal-Mart Stores posted disappointing quarterly sales as lower prices for some food and electronics reduced revenues, with a like-for-like rise in sales of 1.5 per cent coming in below expectations.