Profits rise at Asda
REDUCING costs across stores and investing in areas of growth have helped Asda’s profits soar.
The Leeds-headquartered supermarket giant reported an increase in group revenues by 4.6% to £22.8bn and said underlying operating profit increased by 7.6%, in the year to December 31, 2012, according to Companies House accounts. Like-for-like sales excluding petrol and VAT rose 1% in 2012 and pre-tax profit was up to £774.3m from £767.8m.
Despite the Walmart-owned retailer stating that the external environment continued to be “challenging” with low wage growth and persistent price inflation exerting downward pressure on disposable incomes, it increased its market share by 0.2% to 17.5%.
Asda said: “We continue to invest in new opportunities and areas of growth in order to diversify our offering to customers.”
23 stores were opened during the year, 13 supermarkets, five superstores and five Asda Livings, adding 640,000 sq ft of new space to the group’s portfolio.
Asda said it online business delivered strong growth and gained market share in grocery, general merchandise and clothing. It also said its multichannel and supermarkets continue to be the two fastest growing areas of the business, with multichannel seeing double digit growth in 2012.
“We delivered against our core purpose of “saving you money everyday” by strengthening our position as price leader. We also improved product and customer service supported by innovations such as the further development of Chosen By You food range with an additional 1,500 new lines in the year,” the group said.
“We have continued to strengthen our price leadership Invested to reduce the price of products across the stores.”
In April 2012, the group acquired Turkish company, Turkmen Tedarik Hitzmetleri, which manages the sourcing of clothing for George. Asda said the transaction will help the group extend its sourcing capabilities.
