Asda’s parent company Walmart created confusion over the retailer’s second quarter results last night after reporting weaker figures than Asda had provided earlier in the day.
The discrepancy occurred because of the different trading periods used by Asda and Walmart in reporting the results. Walmart quoted figures from the 1 April to 30 June which showed like-for-like sales at Asda had fallen 0.4% while the figures cited by Asda showing a 0.7% rise in like-for-likes spanned the 13 April to 5 July - a period that included the start of the fine summer weather.
“The different results reported by Asda and Walmart show Asda definitely took advantage, to some extent, of the beginning of the good weather in its reporting period, but it also highlights how sales can fluctuate generally,” said Clive Black an analyst for Shore Capital.
A spokeswoman for Asda said: “The Asda result is for the 12 weeks ending 5 July, this calculation also ensures we compare the same days of the week in last year versus this year, something consistent with all reporting in UK retail. “
In its trading statement Walmart also said that Asda’s gross margin rose 67 basis points in Q2. This helped operating profits grow faster than sales despite its “investment in price” circa £100m per year and inflationary pressures because it did not repeat last year’s promotional activity during the Jubilee and Olympic Games, as a result operating profits rose 7.5%.
“Our operating income performance in the UK this quarter was driven by three key themes: first, a significant price investment which is moderating comp growth; second, investment in and growth of convenient channels and formats; and third, cost savings delivered via the “We operate for less” program to help offset some of the headwinds we’re experiencing,” Walmart said.