Asda drops further behind supermarket rivals as sales growth stalls

ASDA has fallen further behind supermarket rivals after its sales growth effectively ground to a halt, new figures reveal.

Sales at Asda, which is owned by brothers Mohsin and Zuber Issa and private equity firm TDR Capital, were up just 0.8pc in the past 12 weeks compared to last year, analysts NIQ said.

The supermarket’s growth was much slower than Sainsbury’s and Tesco, which recorded rates of 7.9pc and 6.3pc respectively over the period. Marks & Spencer also posted growth of 11.2pc.

The figures show Asda lagging behind all major rivals over the period, with its market share slipping to 11.7pc compared to 12.3pc a year earlier. This allowed German discounter Lidl to move closer to Asda in terms of market share, which rose from 9.8pc to 10.2pc.

The latest figures will increase pressure on the Issa brothers, who have vowed to increase sales at Asda while cutting costs. The Telegraph revealed earlier this year that Asda had slashed millions of hours for staff to reduce its wage bill, which has threatened to spark a wave of strike action.

It comes as Asda struggles under the weight of billions of pounds of debt following a £6.8bn takeover in 2021, and is faced with hundreds of millions of pounds in interest payments. NIQ said there was “intense competition” among supermarkets in the past 12 weeks, all of which have tried to draw customers in with price cuts.

Waitrose revealed yesterday it was cutting prices further, while Sainsbury’s said it was adding thousands of products to its Low Everyday Prices range. Aldi also pledged to cut prices, saying it would invest more than last year’s £380m on lowering food bills.

An Asda spokesman said: “With more than 18m customers a week, Asda is a highly cash-generative business and this underpins the supermarket’s ability to pay down debt, while continuing to invest in colleagues and new customer propositions.”