Asda’s pre-tax profits have been hit by provisions for fines and legal costs arising from the Office of Fair Trading investigations in to allegations of price-fixing.

Asda’s pre-tax profits fell to£560 million in 2007, down from£592 million in the previous year.

Asda, the Wal-Mart owned grocer, notched up a sales increase to£16.8 billion in the 12 months to December 31, up from£15.7 billion the year before, according to figures filed at Companies House.

In the report, Asda said underlying profits grew year-on-year and “were ahead of internal targets”.

Asda’s highest director – believed to be chief executive Andy Bond – was paid£1.07 million, up from£691,000.

Asda said the result was “significantly” affected by “an allowance for legal matters in connection with the OFT investigations on milk and tobacco”.

Asda did not disclose the exact figures set aside but it included provisions for the costs and fines in£1.5 billion of trade payables.

It follows a long-running investigation by the Office of Fair Trading into price-fixing with regards to dairy and other products. Last year, Asda admitted liability, along with other retailers and dairy groups.

In April, the Office of Fair Trading alleged Asda and other retailers and tobacco manufacturers engaged in “unlawful practices” by swapping information about the future prices of cigarettes.

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