U.S. actress and singer Miley Cyrus poses for photographers as she launches a new clothing range for Asda, at a store in Derby, central England.
U.S. actress and singer Miley Cyrus poses for photographers as she launches a new clothing range for Asda, at a store in Derby, central England.

Asda, Britain's second largest grocery retailer after Tesco, posted fall in its second quarter sales growth following a slash in the family budget due to credit crisis.

Asda, owned by Wal-Mart group, posted lower growth in the like-for-like sales by 0.7% in its second quarter down from 1.3% in the first three months of the year.

The company said that the like-for-like sale was driven by its ongoing investment in creating a "multi-format and multi-channel business".

"We're pleased with our results in a tough market. We continued to grow our sales while also investing in holding down the price of essentials." Andy Clarke, president and chief executive officer of Asda said.

"Our focus on opening up more ways for more customers to shop with us, particularly in areas currently underserved by Asda, provides us with real opportunity to grow space and channels to adapt our business to today's customer."

Clarke said that the warm weather has been positive for Asda, boosting its demand for summer clothes and sales of barbecue food and outdoor goods.

According to the data of research company Kantar Worldpanel, released last month, the retailer has a 17% market share in the 12 weeks to 7 July, compared with 17.3% year-on-year.

Expanding Business

Britain's retail giant, Tesco, earlier this year decided to stop expanding its chain in Britain and shift its focus on the faster growing sectors of convenience stores and online sales.

Clarke however said that Asda would keep expanding its stores also increasing its focus on online and mobile sales.

"We have 568 stores," he said. "We will continue to open space, but as I signalled three years ago, I wasn't prepared to acquire space at any cost, and that is the way we are going to continue to invest."

Clarke said that despite Britain's improving economic condition, consumers remain under the pressure. "We are bumping along the bottom," he said.

Other than Tesco, Asda also competes with Sainsbury's and Morrisons.