Asda co-owner Mohsin Issa has blamed what he called a “challenging retail environment” for falling revenues and a slump in like-for-like sales at the grocer.
In the second quarter of the 2024 financial year, Asda’s total revenues excluding fuel fell by 2.2%, with like-for-like sales declining 5.3%.
For the first half, total revenues excluding sale did jump 2% although like-for-like sales for the first half dipped 2.1%.
Online sales were stronger during the second quarter for the grocer, with sales on George.com up 3.9% and online grocery up 1.4%.
The retailer said its George back-to-school campaign had its “best start” with store sales up 88% year-on-year in the first two weeks.
As a result of its poor first half, Asda said it had a “clear and decisive plan” to deliver more consistent results in the second half of the year with a focus on three key areas: customer satisfaction, enhanced product availability and a renewed trading plan.
Asda said it would invest in enhancing availability across all categories, including 1,000 core grocery lines that are “most important to customers”.
The Leeds-based business also said it would invest an additional £30m in colleague hours – “to ensure a strengthened customer proposition”.
The grocer’s plans for a “renewed trading plan” will focus on increasing uptake of its Asda Rewards scheme.
Asda said the loyalty app has grown to account for 52% of all transactions across the business in two years with over 6 million regular users.
The supermarket giant said 130 stores have already received a “major refresh” in its £50m store upgrade programme.
Issa said: “These results highlight a period of robust online performance and a record start to George’s back-to-school campaign. Despite a challenging retail environment, George.com sales rose by 3.9% and online grocery increased by 1.4%, underscoring our steadfast commitment to delivering quality and value to our customers. Asda Rewards continues to go from strength to strength and now accounts for 52% participation in all transactions.
“As we move forward, we remain committed to maintaining our value credentials, enhancing the product offer and executing our long-term growth strategy to build an even stronger Asda for our customers and communities.”
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