Asda celebrates bumper festive trading as shoppers trade up

Asda has reported strong Christmas trading as customers decided to treat themselves with premium ranges after a difficult year.

Asda has seen strong growth in online deliveries during the pandemic

The Leeds-based supermarket chain said like-for-like sales rose 6.9 per cent in the eight weeks to December 24. They rose 5.1 per cent in the last quarter of 2020.

The UK's third biggest grocer said its Christmas performance was driven by strong demand for its premium ranges as customers traded up.

Sign up to our Business newsletter

Sign up to our Business newsletter

In its last trading update as an offshoot of Walmart, Asda said demand for premium Extra Special lines increased significantly, particularly in the meat, fish and poultry categories, with sales in December up by 30 per cent year on year.

The supermarket also reported strong growth in online sales during the quarter, with combined net sales for Asda.com and George.com increasing by 76 per cent year-on-year.

This comes after Asda increased its grocery home shopping capacity by 90 per cent to 850,000 weekly slots between March and December 2020.

Roger Burnley, Asda CEO and president, said: “Our focus on keeping prices low, providing great quality products and keeping customers safe when they visit our stores were key to delivering a strong performance across the quarter and particularly during the busy Christmas period.

"The festive season was like no other and I am proud of the way Asda colleagues responded to the exceptional circumstances they faced. It was only right that we recognised their hard work by closing our stores on Boxing Day so the vast majority of them could spend more time with their family during this period.”

Asda accelerated its in-store partnerships strategy during the quarter, with the addition of fashion brand Accessorize. The retailer has opened an ‘in-aisle’ fixture in Asda’s Sutton Coldfield store selling a range of bags, jewellery and seasonal clothing.

The supermarket also opened the first two compact B&Q stores inside its Sheffield and Dagenham stores during the quarter and extended its partnerships with musicMagpie, Claire’s

Accessories and Decathlon to further stores across its estate.

Mr Burnley said: “As a business, we have demonstrated huge resilience during the last quarter – and year as a whole - supporting customers and communities during the most challenging of times.

"Helping local communities recover from the pandemic remains a key priority this year – as the recent launch of our in-store Covid vaccination service and starting the donation of 7,000 laptops to schools to tackle digital exclusion during lockdown shows.”

Earlier this week, the Issa brothers and private equity firm TDR Capital completed the acquisition of Asda from Walmart for an enterprise value of £6.8bn.

The brothers and TDR have bought a majority ownership stake in the supermarket chain, while Walmart will retain an equity investment in the business, with an ongoing commercial relationship and a seat on the board. The deal was announced in October.

The transaction is still subject to regulatory approval. The Competition and Markets Authority (CMA) has set a April 20 deadline for a ruling. The brothers and TDR said they remain confident of a positive outcome.