Asda has reported its first quarterly sales growth in more than two years, signalling early progress in its turnaround after prolonged operational and financial difficulties. Executive chair Allan Leighton said lower prices, a stronger online service and steadier IT systems were bringing more customers back, though the retailer remains under pressure from Aldi, Lidl, Tesco and Sainsbury’s.

Sales at established stores, excluding fuel, rose 0.2% in the three months to June, reversing a 2.3% fall in the previous quarter; food sales increased 0.7%, while clothing and non-food sales declined. Asda has struggled since its £6.8bn 2020 buyout by the Issa brothers and TDR Capital, including a costly IT overhaul approaching £1bn, and plans to use Ocado technology to improve online operations from next year.