Asda Returns To Profit In 2023 Despite Competition From Rivals

By Reuters
Asda Returns To Profit In 2023 Despite Competition From Rivals

UK supermarket group Asda said on Friday it returned to a pretax profit in its 2023 financial year even though it lost market share to rivals in that period.

Brothers Mohsin and Zuber Issa and private equity firm TDR Capital own a 90% stake in the group, which they purchased from US giant Walmart in a £6.8 billion deal in 2021.

Walmart still owns 10% of the supermarket group.

Earlier this month, TDR agreed a deal to gain majority ownership by acquiring Zuber Issa’s share.

Asda, Britain’s third largest supermarket group, said it filed its annual accounts at Companies House on Friday for the year to the end of December 2023.


It showed a pretax profit of £180 million, compared with a loss before tax of £432 million in 2022.

The group said the outcome reflected an increase in operating profit and a partial reversal of previous impairment provisions.


Asda had already reported in April that underlying earnings for 2023, or adjusted earnings before interest, taxes, depreciation and amortisation (EBITDA) after rent, had increased 24% to £1.078 billion on total sales, excluding fuel, that rose 7.1% to £21.9 billion.

This is in spite of its weaker performance against rivals.

Market researcher NIQ said on Thursday that Asda’s sales fell 4.9% in the 12 weeks to 15 June year-on-year, with its market share down a whole percentage point on the year to 12.2% – as it struggles to keep up with industry leader Tesco and number two group Sainsburys.


Analysts said Asda’s ability to compete has been burdened by high debt levels.

Interest costs rose to £225 million in 2023 and Asda’s net debt as of the end of March 2024 was £3.8 billion.

Asda says its focus is on growing the business for the long-term by diversifying its offering.

It highlights major investment in its online business, on expanding its convenience store estate and upgrading its bigger stores.

Read More: UK Grocery Sales Slow Down In Wet Weather – NIQ

Stay Connected With Our Weekly Newsletter

Processing your request...

Thanks! please check your email to confirm your subscription.