Asda beats plan despite tough economic enviroment
Wal-Mart Stores, Inc. announced today (13th May) that ASDA had delivered a strong first quarter thanks to an increase in customer traffic driven by lower prices and strong seasonal events.
Comp sales (like-for-like), excluding petrol increased by 6.4%, taking into account an early Easter and the effect of the extra leap day (5% with these benefits stripped out). Total sales increased in the â€˜high single digitsâ€™ for the period up to 31st March.
ASDA outperformed the market for the eighth consecutive quarter with market share up 0.3% year-on-year in the 12 weeks to 20th April. Wal-Mart also revealed a ‘healthy’ sales performance from ASDA in April, with strong fresh food sales.
At a time when food commodity prices are on the increase, ASDA has continued to lower prices across the weekly shop, maintaining its position as price leader in the supermarket sector.
The retailer also saw an increase in the sale of Extra Special, ASDA’s premium brand own label food, with sales up over 30% year-over-year, showing that even when times are tough, customers want quality food at the lowest possible price.
ASDA opened three new food stores in the first quarter, in Bridgend, Andover and Ballyclare, all of which have outperformed targeted sales levels.
On a conference call to analysts today, Mike Duke, Wal-Mart International vice chairman, said:
“ASDA has continued to win in the United Kingdom â€“ delivering a strong first quarter, with thirty basis points of market share growth, despite a challenging economic environment.
“Although we expect the UK to remain a challenging economy and retail market over the rest of the year, we believe that our strong pricing agenda, backed by a cost reduction programme leaves us well positioned to continue to make market share there.”
ASDA’s first quarter results come at a time when money is tight and customers, more than ever, need to get the best value for money.
ASDA President and CEO, Andy Bond commented:
“It’s at times like these when ASDAâ€™s values really come into play. Our role to help give customers good quality products at affordable prices is more important than ever before.
“Whilst todayâ€™s results are encouraging, we mustn’t become complacent – especially in the current economic climate. We have a duty to lock down inflation by working with our suppliers, to cut costs to ensure that our customers are always getting the best possible deal on their weekly shopping.”