Ahead of its proposed merger with Sainsbury's, Walmart-owned UK retailer Asda has posted a 3.7% increase in net sales in the first quarter of its financial year.
While Walmart doesn't reveal individual sales figures for the different aspects of its International division, of which Asda is a part, the UK retailer saw basket size increase by 3.3% and traffic increase by 0.1% in the period.
Comparable sales were up 3.4%.
Commenting on its UK performance, Walmart International said that Asda's 'gross profit rate decreased versus last year, with continued price investment, and sales mix pressure due to earlier timing of Easter.'
E-Commerce Growth
In the US, meanwhile, Walmart's e-commerce sales grew 33% during the first quarter ended April 30, above the 23-percent growth in the previous three months. The retailer said it is on track to increase U.S. e-commerce sales by 40% for the full year.
The e-commerce rebound comes after a sharp slowdown during the crucial holiday quarter, which sent its shares down over 10% and wiped out $31 billion from its market capitalisation. Investors worried the retailer would not be able to keep pace with rival Amazon.com Inc.
"Online grocery continued to accelerate and we also have new brands in e-commerce including the partnership with Lord and Taylor, so there are a lot of different things driving growth there," Chief Financial Officer Brett Biggs said in an interview.
He said the Walmart.com site redesign helped although it came late in the quarter. The retailer recently revamped its website and has said it will offer more premium products through a partnership with department store chain Lord & Taylor.
Flipkart Deal
Walmart also recently said it will acquire a 77-percent stake in Indian e-commerce firm Flipkart for $16 billion, its largest deal ever, to compete with Amazon.com Inc in an important growth market.
Excluding special items, adjusted earnings were $1.14 per share. The average analyst estimate was $1.12 per share, according to Thomson Reuters I/B/E/S.
Sales at U.S. stores open at least a year rose 2.1% excluding fuel, in line with analyst forecasts, according to Consensus Metrix. Walmart has recorded nearly four straight years of U.S. growth, unmatched by any other retailer.
Total revenue increased 4.4% to $122.7 billion, beating analysts' estimates of $120.5 billion.
Walmart's shares were up 1.17% at $87.14 in premarket trade. The company's stock has fallen around 20% since reaching an all-time high of $109.98 in late January.
News by Reuters, edited by ESM. Additional reporting by Stephen Wynne-Jones. Click subscribe to sign up to ESM: European Supermarket Magazine.
