The crisis at Asda deepened yesterday when figures showed its share of the grocery market has plummeted to the lowest level on record.
Data from industry research group Kantar showed the private equity-owned supermarket now has a 12.8 percent stake.
Asda has been reeling since the Issa brothers joined forces with private equity giant TDR Capital to buy it in a £6.8bn debt-fueled deal three years ago.
Rising interest rates have pushed up the cost of borrowing, while shoppers have flocked to rivals including discounters Aldi and Lidl, as well as Tesco and Sainsbury’s.
Asda’s market share is the lowest since Kantar began sharing figures in 2011. It is a dramatic fall from 13.7 per cent a year ago.
Record low: Data from industry research group Kantar showed private equity-owned supermarket Asda now holds a 12.8% share of the UK grocery market.
The figures are a blow after an earlier trading update raised hopes that the supermarket could be at the start of a revival. In April, it posted a small return for 2023.
The group, once Britain’s second-largest supermarket, has lost ground to traditional rivals Tesco and Sainsbury’s, as well as discounters Aldi and Lidl.
According to Kantar, Asda’s sales in the 12 weeks to June 9 amounted to £4.3bn, down 4 per cent on the same period a year earlier.
All its rivals saw their sales increase: Lidl rose by 8.1 per cent, Sainsbury’s by 4.9 per cent, Tesco by 4.6 per cent, Morrisons by 1.1 per cent and Aldi by 0.8 per cent.
Last week, Zuber Issa sold his Asda shares to TDR. This means that the London company is the majority owner of Asda, while Mohsin Issa still owns 22.5 percent.
The search for a chief executive continues and Asda has not had one since 2021.
Mohsin Issa said earlier this year he was carrying out a “reboot” of the company before hiring a boss. But retail experts say the supermarket will struggle to return to its former glory.
It is “inevitable” that Aldi will grow in the next two years, said Jonathan De Mello, of the consultancy JDM Retail.
Aldi owns 10 percent of the market. Lidl has increased its share over the year from 7.7 percent to 8.1 percent.
Tesco reached its highest share since February 2022, growing 0.6 percentage points to 27.7 percent. Sainsbury’s owns 15.2 per cent of the market, up from 14.9 per cent last year.
Morrisons, also owned by private equity, has also performed poorly. It owns 8.7 percent of the market compared to 8.8 percent at this time last year.
Hard to swallow: Mohsin Issa said earlier this year he was undertaking a ‘reboot’ of Asda