Cut throat competition in the UK grocery sector is not making life easy for Asda, the UK arm of Wal-Mart.
Asda has posted its fourth consecutive quarter of falling sales. Sales excluding fuel at stores open more than a year - the measure commonly referred to as "like for like" - have dropped 4.7 per cent in the company's second quarter, the 11 weeks to June 30. This is an acceleration from the 3.9 per cent sales decline in the first quarter of the year.
The most recent supermarket share data from the well respected research group Kantar Worldpanel showed Asda is suffering the most among the big four UK grocers, as its sales fell 2.7 per cent in the 12 weeks to July 20 versus the same period a year ago.
The major supermarket chains have been waging a bitter price war as they seek to stem the loss of customers to the expanding German discount chains, Aldi and Lidl, writes Nathalie Thomas.
Asda president and chief executive Andy Clarke described the second quarter performance as "disappointing" but insisted they reflect a short-term picture. He said:
We continue to navigate a steady course through the worst storm in retail history, despite another challenging quarter. Predicting that 2015 was going to be a volatile year I didn't expect to report a positive sales figure, but I'm not distracted by the short-term picture. We have an enviably stable business with balanced books and the right strategy to return us to sales growth.