Asda full year profit & sales rise despite failed Sainsbury’s merger
Asda, the British supermarket arm of U.S. retail giant Walmart (WMT.N) that is considering a future UK stock market listing, saw its profit increase 9.2% in 2018 - a year when it was unsuccessfully targeted for takeover by rival Sainsbury’s.
Sainsbury’s 7.3 billion agreed bid for Asda was blocked by Britain’s competition regulator in April 2019, a full year after it was launched.
Walmart said in May it would instead look at an initial public offering for Asda.
Accounts filed on last week showed Asda’s operating profit was 803.2 million pounds in the year to 31 December, on revenue, up 3.1% to 22.92 billion pounds. As was the case in 2017, no dividend was paid to Walmart, writes Reuters.
Lower prices and e-commerce
Under Chief Executive Roger Burnley, Asda is following a strategy focused on lower prices to narrow the gap with the German discounters, a step-up in innovation in own-brand products, and better store environments and product availability, along with improvements in its e-commerce operations and use of technology.
Burnley told Reuters in May the timescale for a possible flotation on the stock market was two to three years.
Last month Asda reported a small rise in underlying sales for the second quarter of its 2019 year. It said however, that uncertainty surrounding Brexit was affecting its customers.
Sources: Asda, Reuters, Retail Gazette.