LONDON (Reuters) - Asda, the British arm of United States retailer Wal-Mart , posted a 1.3 percent rise in first quarter underlying sales as price reductions and its online offering proved popular with shoppers.
Britain's second-biggest supermarket chain behind Tesco (Other OTC: TSCDY - news) on Thursday said sales at shops open over a year, excluding fuel and VAT, rose 1.3 percent in the 14 weeks to April 12.
That followed a rise of 0.1 percent in the fourth quarter of the previous financial year.
Asda, which has been investing more in 50 pence and one pound lines and lowering prices on essentials like milk, eggs and bread, said online sales grew by over 16 percent in the first quarter. The firm's market share remained unchanged at 17.9 percent, it added.
"This represents a strong performance in what remains a very tough market," Asda chief executive Andy Clarke said.
"Despite a difficult environment for our customers, we have continued to achieve growth on growth by lowering the prices of essentials and investing in technology to make shopping more convenient."
Britain's grocers, despite their focus on essential goods, have not been immune to the economic downturn.
Last month Tesco posted a 51.5 percent slump in year profit, while last Thursday No. 4 player Wm Morrison posted a 1.8 percent fall in first quarter like-for-like sales.
However last Wednesday No. 3 J Sainsbury's reported a 6.2 percent rise in annual profit.
Asda's sales update was released as parent Wal-Mart, the world's largest retailer, posted a higher quarterly profit on Thursday, despite underlying sales falling 1.4 percent.
(Reporting by James Davey and Neil Maidment; Editing by Rhys Jones)