Asda’s like-for-like sales fell by 5.8% in the fourth quarter ended January 1, amid “fierce competition” and “permanent structural change” in the grocery sector.
Sales for the year to January 1 fell by 4.7% compared with the previous year. There was no breakdown for the George clothing business.
Chief executive and president Andy Clarke said he expects difficult conditions to continue for the foreseeable future and said he had a clear strategy to reaffirm Asda’s aim to be the UK’s lowest price, full-price supermarket business.
Plans include modernising 95 of its largest stores and joining the European Marketing Distribution buying alliance, which was announced in January. The firm will review store services and reduce product ranges to remove duplication.
“While I am cautiously optimistic that our sales will gradually improve, it won’t happen overnight given 2016 is likely to be another tough and competitive year for the sector as a whole,” said Clarke.
Asda has reportedly been asking its suppliers for discounts following a tough Christmas and, in January, the company announced up to 300 job cuts at its head office in Leeds in response to a “radical change” in the way people shop.
As Drapers exclusively revealed, Asda’s vice president of own label development Fiona Lambert decided to leave the business at the time.