Sales and market share fall for Asda

SUPERMARKET chain Asda saw sales fall in the second quarter and warned of difficult times ahead for consumers.

The Leeds-based group, part of US retail giant Walmart, recorded sales down by 0.4% on a like-for-like basis without fuel while its market share also dropped slightly in the 12 weeks to July 11.

In a conference call for investors Walmart international president Doug McMillon said Asda was making “good progress” towards its strategic goals and the recent decision to buy Netto Food stores would bring the chain new locations for smaller outlets.

Asda’s gross margin as a percentage of sales increased as the company moved to higher-margin goods with clothes brand George having “a particularly strong quarter”.

The chain also benefited from strong sales of World Cup related merchandise.

The company is set to open its second dedicated home shopping centre which, Mr McMillon said, would “provide enhanced coverage in an area of low market share for Asda”.

Asda also published new research suggesting that consumers could have the lowest level of disposable income for two years in the final quarter of the year.