Asda is back in profit, as tomorrow’s figures will show.
The supermarket chain is expected to post a small pre-tax surplus after losing £74m in 2022.
The news comes as one of the Issa brothers who backed the debt-fueled takeover of Asda is set to sell his stake to private equity group TDR Capital.
Supermarket returns to profit: Asda is back in the black, helped by the launch of a loyalty app and the strong performance of the George clothing range
Zuber Issa is said to be close to offloading its 22.5 per cent stake, which would give TDR majority control of Britain’s third-largest food retailer.
He and his brother Mohsin joined forces with TDR to buy Asda from Walmart for £6.8bn three years ago.
Rising interest rates raised the cost of servicing Asda’s debts, while rampant inflation caused food prices to soar, hitting cash-strapped shoppers and the supermarket’s bottom line.
But Asda is back in the black, helped by the launch of a loyalty app and the strong performance of the George clothing range. Total sales excluding fuel rose 7 per cent to £21.9bn, or 5.4 per cent on a like-for-like basis.
Net debt has also fallen from £4.2bn as strong cash flow offset higher interest payments.
The results are a boost for the brothers who have denied there was talk of a rift between them. Bloomberg reported that TDR was close to taking control of Asda.
Asda declined to comment.