Asda plans to open 10 more stores as sales growth beats rivals

Asda is to open 10 more stores in the UK this year in a move that will cost £360m and create 3,900 new jobs.

The announcement was made as Wal-Mart, Asda's US parent company, reported fourth-quarter results which showed Asda continuing to enjoy industry-beating sales growth. The continuing growth will increase the pressure on J Sainsbury, which Asda is expected to overtake as Britain's second-largest supermarket operator later this year.

However, Wal-Mart made no comment on its part in the £3bn bid-battle for Safeway.

Wal-Mart said Asda's like-for-like sales in the three months to 31 January were up by low double digits if petrol was excluded and high single digits if it was included. It said profits are growing faster than sales.

Non-food sales were up by "the mid-20s" on last year, on an underlying basis. Wal-Mart said Asda's sales of electrical goods, entertainment and homewares had been particularly strong. It singled out the George clothing range as a key success story with like-for-like sales growth of about 25 per cent. Wal-Mart said the number of Asda shoppers regularly buying George clothing had doubled to more than 30 per cent over the last two years.

The new locations include an old Tesco store on Sutton high street in Surrey and others in Bournemouth, Basingstoke, Oldbury in the west midlands and Crawley in East Sussex.

The expansion will give Asda a total of 265 UK stores. The business had already announced plans to add mezzanine levels to up to 40 of its stores as a means of increasing space.