Sales fall as Asda struggles with market share

Sales at Asda have continued to fall as the supermarket chain struggles to gain market share amid strong competition from rivals.
The private equity-backed group reported a 4.8 per cent decline in like-for-like sales in the three months to the end of September.
Lord Rose of Monewden, chairman of Asda, said: “I have to admit that we’ve probably not been as sharp on our trading stance as we should have been. We recognise that we have lost a bit of market share and a bit of momentum.”
Asda, the UK’s third-largest supermarket chain, held a 12.6 per cent share of the grocery market compared with 13.7 per cent a year earlier, according to summer figures from Kantar, the research consultancy. Over the last year Asda has come under pressure from bigger rivals such as Sainsbury’s and Tesco, as well as the discounters Aldi and Lidl.
Total revenues at Asda, excluding fuel, fell to £5.3 billion in the quarter, down 2.5 per cent from the same period last year.
Despite the decline in group revenues, George, Asda’s clothing division, reported a 4.9 per cent increase in like-for-like sales. Its strong performance was boosted by the retailer’s “back to school” range, which posted quarterly sales of £180 million.
Earlier this week the supermarket chain announced it was cutting 475 head office jobs as it looks to streamline the business. Rose, a former executive chairman of Marks & Spencer, said the job cuts were “a necessary move and the right move for the business”.
Asda is still in the process of appointing a new chief executive. Rose said the search was “in progress” and that “we are conscious that we need to find the right person. It will be a square peg in a square hole.”
Mohsin Issa announced in September that he was stepping down from his executive leadership role of running the supermarket. His brother, Zuber Issa, ceased to be a co-owner in June.
Asda is 67.5 per cent-owned by TDR Capital, a private equity firm, with Mohsin, 53, holding 22.5 per cent. Zuber, 52, sold his 22.5 per cent stake to TDR this year.