Asda sees glimmer of light with some sales growth after 11 successive drops

● Like-for-like revenues up 1.8% in latest quarter as price-cutting helps trade

Supermarket giant Asda has unveiled its first quarter of sales growth in three years in the first sign that a revamp steered by chief executive Sean Clarke is starting to work.

Scotland’s second biggest food retailer, whose parent is US retail major Walmart, said same-floorspace sales rose 1.8 per cent in its second trading quarter. That drew a line under 11 successive quarters of sales falls.

Clarke took the helm in July 2016, and the latest results come a year after Asda posted its worst quarterly sales performance on record – down 7.5 per cent.

Supermarket industry experts said yesterday that the quarterly turnaround just announced was fuelled by a mix of price cuts and rising inflation.

A key part of Clarke’s strat- egy has been to cut the prices of everyday items, with Asda announcing last September that it was reducing prices by an average of 15 per cent including key staples such as chicken, sausages and beef.

Despite the improvement in performance, Clarke said “we need to continue to up our game to be in the best shape possible”.

He said an extra 275,000 customers had chosen to shop at Asda in the quarter, with the Easter period last April a particular success, when sales surged 16 per cent.

Stripping out the Easter factor, the retailer’s like-for-like quarterly sales were up 0.7 per cent. Clarke added: “We will continue to work collaboratively with our suppliers to create the best products, make investments where they matter most to our customers, and ensure that we are fit for purpose in what remains a competitive market.”

Doug Mcmillon, Walmart’s chief executive, commented: “We’re also encouraged that the UK delivered positive comparative sales.

“In June, I visited Asda to see the progress being made. Customers are responding to investments in price and store experience by visiting the stores more often and increasing their basket sizes.

“There’s still much more to be done, but we’re clearly headed in the right direction.”

Last year Asda’s sales fell more than 3 per cent to £21.7 billion, with earnings down nearly a fifth to £792m.

In recent years the discounter supermarkets Lidl and Aldi have eaten into the market share of Britain’s big four supermarkets, and now have a 10 per cent-plus slice of the sector.

Asda is currently the third biggest UK player, with a marketshareofabout14.5percent, trailling Tesco, the number one, and Sainsbury’s.