13th Jan 2015 10:11
LONDON (Alliance News) - The UK's big listed grocers have slowed the rate at which shoppers are defecting to German discounters Aldi and Lidl, latest industry data from Kantar Worldpanel suggested Tuesday.
The big four grocers - Tesco PLC, Wal-Mart Stores Inc-owned Asda, J Sainsbury PLC and Wm Morrison Supermarkets PLC - again saw a decline in till roll over the Christmas period, but the decline was slower than in previous months, while the gains being made by Aldi and Lidl also slowed, the Kantar data showed.
Sales at J Sainsbury PLC fell by 0.7% over the 12 weeks to January 4, but in a tough grocery market that was the best performance among the big four supermarkets, Kantar said. Sainsbury's market share fell to 16.9% from 17.1% a year ago.
Tesco PLC's sales fell 1.2% compared with last year, but this was their best performance since March 2014 and represents a notable improvement, according to Kantar. Although revenue declines are slowing, Tesco continues to lose market share, down to 29.1% from 29.6% a year ago.
Sales fell by 1.6% at both Morrison Supermarkets PLC and Asda, owned by US giant Wal-Mart Stores Inc. While Morrisons' market share dipped to 11.3% from 11.5%, Asda's share fell to 16.8% from 17.1%.
"Given the seasonal nature of this share increase there is a high likelihood that Asda will retake the number two spot later in the year," said Fraser McKevitt, head of retail and consumer insight at Kantar Worldpanel.
German discounters Aldi and Lidl, meanwhile, experienced sales growth of 22.6% and 15.1%, respectively. Aldi's market share rose to 4.8%, from 4.0% a year earlier, while Lidl's share rose to 3.5%, from 3.1%. Lidl's sales growth slowed from the 18.3% growth that Kantar reported for the 12 weeks to December 7, while Aldi's growth was broadly flat.
"More than half of all British households visited at least one of the two retailers over the past 12 weeks. Waitrose also maintained its strong run as sales rose 6.6% to take its market share to 5.1%," McKevitt said.
Prices continued to fall across the sector, dropping 0.9% in the latest 12 weeks, marking a 16th consecutive drop. Like-for-like prices were also down 0.9% on the year. Sales volumes in the market rose 0.6%, the fastest rate since August last year.
"Shoppers were the big winners at Christmas with cheaper grocery prices encouraging them to spend more at the tills. Like-for-like prices have fallen by 0.9% due to lower commodity costs and an ongoing price war which has continued as the large retailers battle for market share," said McKevitt.
The UK listed grocers were all amongst the best performing stocks on the FTSE 100 Tuesday morning. Sainsbury's shares were up 3.4% at 248.39 pence, while Tesco shares were up 3.6% at 211.85 pence. Morrisons shares were the biggest gainer on the blue chip index, up 5.3% at 186.22 pence, following news earlier in the day of better Christmas sales and the announcement that its Chief Executive Dalton Philips will step down in March after five years at the helm.
By Rowena Harris-Doughty; [email protected]; @rharrisdoughty
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