Asda returns to profit for 2023 as online sales grow

Leeds-based supermarket giant Asda said it delivered a pre-tax profit of £180 million for 2023 compared with a loss before tax of £432 million in 2022 “reflecting an increase in operating profit and partial reversal of previous impairment provisions.”

Total sales (excluding fuel) increased by 7.1% to £21.9 billion in 2023.

Asda said it filed its annual accounts at Companies House for the financial year ending December 2023, in which it delivered a 24% increase in adjusted EBITDA after rent to £1.078 billion driven by 5.4% like-for-like sales growth, “from its continued focus on value for customers, and the impact of strategic acquisitions in the convenience sector.”

Asda said it recorded record online grocery sales in 2023 “delivering  39 million orders with a sales value of £3.2 billion, and ending the year with its highest ever online grocery market share of 20.8%.”

Online now accounts for 18% of Asda’s total grocery sales – an increase of 8% since 2020.

Michael Gleeson, Asda’s Chief Financial Officer, said: “We are investing to build a bigger and better Asda bringing our heritage in value to more customers across the UK.

“Our priority remains growing the Asda business for the long-term through diversifying our offering to ensure customers can shop with us when and how it best suits them.

“Our online business is key part of our omnichannel offering and it is pleasing to see the investments made in price, service and to expand our digital footprint continue to resonate with customers and drive sales.”

Private equity firm TDR Capital LLP said on June 7 it agreed to acquire Zuber Issa’s shares in Asda, taking its ownership of Asda to 67.5%.

The transaction is set to complete in Q3 of 2024. Zuber’s brother Mohsin Issa remains a co-owner in Asda with a 22.5% stake. Walmart Inc retains 10%.

Asda also said on June 7 it is undertaking an extensive international executive search to find a permanent CEO to lead the business in its next phase of growth.

Asda recently refinancing of more than £3.2 billion of its debt.

The Blackburn-based billionaire Issa brothers and TDR Capital completed the £6.8 billion acquisition of a majority ownership stake in Asda from Walmart Inc. in 2021.