Walmart's (WMT) U.K. division is coming back to life.
Asda, the name Walmart goes by in the U.K., saw sales increase 1.4% in the 12 weeks to Aug. 13, according to U.K. grocery store data from Kantar Worldpanel released Tuesday, marking a continued turnaround for Walmart, which has suffered a decline in sales for many quarters in the U.K.
"After a difficult couple of years, Asda has managed to continue the run of positive sales performance which began in April this year - up 1.4% during the latest quarter," Kantar Worldpanel Head of Retailer and Consumer Insight Fraser McKevitt said in a statement. "Own label has been important to the grocer's turnaround, providing a boost from both ends of the price spectrum: the value 'Farm Stores' and premium 'Extra Special' lines both saw double-digit growth during the past 12 weeks."
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Walmart last week announced that its U.K. division had returned to like-for-like sales growth. Sales were up 1.8% in the three months ended in June. The quarter also saw Asda lose its crown as the world's largest retailer's worst performing division.
"We're also encouraged that the U.K. delivered positive comp sales," Walmart CEO Doug McMillon said in the company's quarterly earnings call. "In June, I visited Asda to see the progress being made. Customers are responding to investments in price and store experience by visiting the stores more often and increasing their basket sizes. There's still much more to be done, but we're clearly headed in the right direction."
Asda, however, is being threatened by low-cost retailers Lidl and Aldi, with its market share falling to 15.3% in the quarter, compared with 15.7% in the last year. Privately held Lidl is now the seventh biggest supermarket in the U.K. with its market share growing to 5.2% in the quarter, up from 4.5% last year. Sales at the German grocer were up 18.9% according to the Kantar data. Meanwhile, Aldi, saw sales increase 17.2% in the 12 weeks to Aug. 3 and its market share up to 7% from 6.2% last year.
Walmart shares closed at $79.91 Monday in New York, after gaining 0.44%.
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