George fashion label key to Asda's 'Formula for Growth' strategy

British supermarket group Asda has revealed a shift in its revenue mix as non-food divisions, including its fashion label George, continue to gain importance within the wider business.

According to the trading update for the fiscal year ending December 31, 2025, nearly half of the group’s total sales now originate from channels outside of traditional in-store grocery. The retailer, based in the UK, reported that George at Asda and its pharmacy division both outperformed their respective markets over the past year.

This diversification is a central pillar of the group’s ‘Formula for Growth’ strategy, which aims to transform the business over a three-to-five-year period.

Strategic importance of George at Asda

The fashion and lifestyle label George remains a critical asset for the group. Combined with online, convenience, and fuel, these divisions accounted for 47 percent of total revenues in FY2025.

The performance of George was specifically highlighted by executive chairman Allan Leighton, who noted the brand's ability to capture market share in a competitive retail environment.

Total annual sales for the group reached 26.80 billion pounds (35.56 billion dollars). However, when excluding fuel, sales fell to 21 billion pounds, representing a 3.3 percent decrease compared to the previous fiscal year.

Financial metrics and turnaround progress

Despite the dip in top-line sales, Asda reported that like-for-like sales momentum improved toward the end of the period. After starting January at negative 1.6 percent, LFL sales turned positive in March, reaching 1.2 percent. This recovery was supported by a return to high availability levels, which reached an eight-year high of 95 percent following the completion of major systems upgrades under ‘Project Future’.

Adjusted EBITDA (after rent) for FY2025 stood at 764 million pounds, a 33.1 percent decline from the 1.14 billion pounds achieved in FY2024. Chief financial officer Michael Gleeson attributed the current position to disciplined cash management, noting the group ended the year with 1.30 billion pounds in cash and total liquidity of 2.10 billion pounds.

Asda currently operates approximately 1,100 stores across the UK, a portfolio that includes 154 supermarkets and 500 Asda Express convenience sites.

Leighton stated that as the company enters the second year of its turnaround, the focus remains on delivering an improved customer offer and leveraging the breadth of the group's services, which extend far beyond its identity as a supermarket.