Asda Rewards scheme linked to half of £21.9bn sales

Asda has hailed the roll-out of its loyalty scheme for a surge in sales, with the 6 million customers who have signed up since its launch in 2022 – a million in the past six months – linked to half of all revenue.

In the year to December 31, the supermarket’s adjusted EBITDA after rent increased by 24% to £1.078bn as like-for-like sales grew by 5.4%. Meanwhile, total sales, excluding fuel, rose by 7.1% to £21.9bn in the year.

Asda’s co-owner Mohsin Issa insisted the retailer is a “supermarket powerhouse built on rock-solid foundations”, citing its strong annual results and the 18 million customers who shop with the firm every week.

He added: “Our strategy is all about growth and Asda increased underlying profit to more than £1bn and like-for-like sales by over 5% last year, while significantly growing free cashflow and reducing leverage.

“We are committed to doing the right thing for customers, colleagues and local communities – and are putting in place the strategic building blocks to set up Asda for long-term success.”

Asda said it also benefited from its ongoing investment in value for customers and price reductions, applied to more than 800 popular everyday products.

The supermarket also invested in enhancing the quality of its food to build on the earlier launch of its Just Essentials value range. Work in 2023 included the introduction thousands of new and improved food lines, including a refresh of the supermarket’s ready meals range.

Its clothing range performed particularly well with sales growth of 3.4% to £1.5bn as shoppers responded positively to its George brand.

In January, Asda appointed its first ever chief digital officer as part of its drive to overtake Sainsbury’s and become the UK’s second largest grocery retailer.

Matt Kelleher joined from rival Morrisons, where he had been since 2012, latterly as chief information officer, running a team of 800 staff and with responsibility for all the company’s tech services.

Prior to that, Kelleher worked as group transformation officer at Carphone Warehouse and director of multichannel operations at BestBuy Europe.

At the time, Mohsin Issa said: “Our use of data and technology transformation is a critical element of our ongoing transformation and I am delighted that we continue to attract new talent and skills as we progress this important work.”

The supermarket has also appointed a new retail media partner, SMG, as part of plans to expand its media network in more stores, through new digital channels, and by launching what it claims will be “innovative propositions”.