Asda’s market share recently fell to just 11.5pc - Chris Radburn/PA Asda’s private equity owner has awarded partners with a £31m payday even as turnaround efforts fail to deliver results at the struggling grocer. TDR Capital’s 17 partners shared a profit pot of £31.3m in the year to April, recently filed Companies House accounts show, with its highest-paid partner receiving a £2.6m share of the award. However, the payout is a marked decline from a year earlier, when partners shared £44m between them. T ...

Core Viewpoint - Asda's sales have significantly declined, with a 4.3% drop in the 12 weeks leading to November 30, exacerbating a previous 3.9% decline, indicating challenges in regaining customer loyalty during the critical Christmas shopping period [1][2]. Sales Performance - Asda was the only major supermarket to experience a sales decline, while competitors like Tesco, Sainsbury's, Morrisons, Aldi, and Lidl reported growth during the same period [2]. - Asda's market share fell to a record low of 11.5%, down from 11.6% in the grocery sector [3]. Analyst Insights - Analysts predict that Asda will be the underperformer in trading momentum this Christmas, with expectations that it will not meet its sales aspirations for the festive period [4]. - Last year, Asda's sales also fell by 5.8% during the Christmas season, marking it as the worst performer among UK supermarkets [4]. Historical Context - Asda accounted for 15% of grocery sales in 2021 before being acquired by the Issa brothers and TDR Capital [5]. Management and Strategy - Asda reappointed veteran executive chairman Allan Leighton last year to lead a turnaround, implementing a significant price-cutting strategy [6]. - Leighton acknowledged severe disruptions due to a problematic IT upgrade, which negatively impacted sales and operational efficiency [7]. Operational Challenges - The IT upgrade process, aimed at separating from Walmart's systems, led to empty shelves, online delivery issues, and website outages, contributing to a 2.8% sales drop in the three months ending September [7]. - Asda's management indicated that full recovery is not expected until the second quarter of the following year [7]. Competitive Positioning - A spokesperson for Asda emphasized ongoing efforts to improve online and in-store availability and restore its reputation for value, aiming to re-establish Asda as the UK's cheapest traditional supermarket [9].