* Underlying sales up 1 pct in 14 weeks to Jan. 7
* Sales up 0.1 pct in Oct-Dec, followed by jump in Jan
* Expects boost from summer events
By James Davey and Mark Potter
LONDON, Feb 21 Asda, the British arm of
U.S. retailer Wal-Mart Stores Inc, posted a slowdown in
sales growth in its fiscal fourth quarter as shoppers cut back
due to rising prices, muted wages growth and an uncertain
Chief Executive Andy Clarke said he was instinctively
optimistic about prospects in 2012 but said it was too early to
say if positive recent data on the UK economy represented a
turning point or was merely a blip.
"Listening to customers they are still finding the prospects
of the economy quite challenging," he told reporters on Tuesday.
Britain's second-biggest supermarket chain behind Tesco Plc
said sales at stores open more than a year, excluding
fuel and VAT sales tax, rose 1 percent in the 14 weeks to Jan.
That followed a 1.3 percent increase in the third quarter,
but compared favourably with many of its rivals, prompting CEO
Clarke to tell reporters: "We were the clear winners at
Christmas, we won Christmas."
Asda said underlying sales rose just 0.1 percent in the last
three months of 2011, followed by a surge in demand in the first
week of January, when British shops traditionally offer unsold
stock at cheaper prices.
Tesco reported a 2.3 percent drop in underlying UK sales for
the six weeks to Jan. 7, while industry No.3 J Sainsbury
posted a 1.2 percent increase for the 14 weeks to Jan.
7 and No.4 Wm Morrison a 0.7 percent rise for the six
weeks to Jan. 1.
Many Britons have been cutting back spending over the past
year as price increases outpaced wage rises and higher
unemployment weighed on confidence. The lack of consumption has
been one of the main drags on economic growth.
However, on Friday official data showed British retail sales
rose unexpectedly in January.
That data, a string of strong business surveys and some
stabilisation in the labour market have raised hopes that
Britain's economy will avoid recession despite having contracted
in the last three months of 2011.
Clarke said he expected trade to benefit from this summer
from celebrations to mark the Queen's Diamond Jubilee, the Euro
2012 soccer championships and the London Olympics.
"We would like to recognise that when we have events our
customers shop with us because the extra personality that Asda
offers brings people in," he said.
The chain, which trades from around 540 stores, lagged
Britain's grocery market in 2010 but fought back in 2011, helped
by its purchase of smaller format Netto stores and a re-launch
of its own-brand food range.
It has also benefited from its "price guarantee" which
offers to refund customers the difference, via a voucher, if an
online price comparison website does not show their shopping was
at least 10 percent cheaper than at a rival.
"After some difficulties last year, Asda now seems to be
successfully straddling the quality-price equation and will, in
our view, be one of the major beneficiaries from Tesco's current
difficulties," said analysts at retail research agency
The firm said last month it would invest over 500 million
pounds ($793 million) this year, opening 25 new stores and three
depots and creating up to 5,000 jobs.
Separately Wal-Mart, the world's biggest retailer, posted
fourth quarter sales and profit that fell short of Wall Street