Thursday 19 May 2016 12:25 pm

Walmart up, Asda down: First quarter figures show supermarket still failing to get to grips with turnaround plan

Woes continue for UKsupermarket Asda, which posted yet another quarterly fall in sales.

However, Walmart's share price soared 9.2 per cent in morning trading on the back of the wider group's success.

The figures

Asda posted a 5.7 per cent fall in like-for-like sales for the 13 weeks to 30 March.

The drop comes as parent company Walmart posted better-than-expected figures, with revenues reaching $115.9bn. On a constant currency basis, total revenue was up four per cent to $119.4bn.

For Walmart US, comp sales were up for the seventh consecutive quarter – up one per cent – as customer experience scores continued to improve.

Why it's interesting

It takes a brave man to call the bottom but that's what Asda boss Andy Clarke did last August when he said Asda had reached its nadir.

However since then the supermarket has suffered consecutive quarters of falls, suggesting that he might have been a bit pre-emptive. Like-for-likes fell 4.5 per cent in the third quarter and 5.8 per cent in the fourth quarter.

In February Clarke insisted Asda's "Project Renewal" was still "well under way" – but today's update suggests the grocer still has a long way to go before the turnaround plan yields any fruit.

What Asda said

There was no update from Clarke himself, but speaking in the US, Walmart’s chief financial officer Brett Biggs said: “The UK continues to struggle, due primarily to fierce competition. Improvements in price and product availability throughout the quarter were not enough to overcome traffic and food volume declines in our large format stores.

"However, Project Renewal remains a focus with the aim to simplify and strengthen the customer offer, reduce costs and drive sales. The cost analytics program, which is part of Project Renewal made good progress and delivered savings we were able to invest back into the business.”