Asda posts drop in full year profit
Asda has posted a significant drop in full year profit after it invested in absorbing cost price inflation and keeping prices low for customers,
In the year to 31 December, adjusted EBITDA fell by 24% year-on-year to £886 million.
Meanwhile, total sales (excluding fuel) edged up 0.1% to £20.452 billion.
Asda said it benefited from a strong upturn in performance in the second half of the period, with like-for-like sales up 5.1% on the prior year. This was driven by price investments and new propositions to support customers through the cost-of-living crisis.
During the year, the supermarket dropped the price of more than 100 branded and own-branded lines by an average of 12% and launched its Just Essentials new value range.
Mohsin Issa, Asda’s co-owner, said: “Asda delivered a highly resilient performance last year. We took a conscious decision to support customers by investing heavily to mitigate the impact of inflation and keep prices as low as possible. Although this contributed to a decline in profitability, it was the right thing to do for our customers and will ultimately help to deliver long-term growth.”
Asda said the positive momentum seen in the second half of last year has continued into 2023, with February like-for-like sales rising by 6.8% year-on-year.
Issa added: “Last year saw challenges facing businesses and consumers alike and I am proud of the way Asda colleagues responded to support our customers and communities. They worked incredibly hard throughout the year to serve customers, keep prices in check and to launch new initiatives, like Just Essentials and Kids Eat for £1, to help customers save money.”
