Asda has continued to outperform its peers in terms of profits but the protection of the bottom line saw sales plunge by almost £1bn in 2015, according to accounts filed at Companies House today.

Operating profits climbed 3.3% to £1.1bn in the 12 months to 31 December but sales plunged 3.7% (4.7% on a like-for-like basis) from £23.2bn in the previous year to £22.4bn as customers turned their backs on the supermarket.

Pre-tax profits also leapt by more than £50m to £974.9m as finance costs were reduced by £20m to £74.6m.

Asda’s profits dwarfed the rest of its big four rivals, with pre-tax figures for Tesco, Morrisons and Sainsbury’s coming in at £162m, £217m and £587m respectively in their more recent results for 2015/16. Asda also escaped the multibillion-pound property writedowns which plunged Tesco, Morrisons and Sainsbury’s into the red in the 2014/15 financial year.

However, 2015 proved a tough year for former CEO Andy Clarke who after declaring the supermarket had reached its “nadir” in the second quarter as like-for-like sales sank to an historic low of -4.7% presided over widening declines in the remaining quarters.

Clarke was finally shown the door in June to be replaced by Sean Clarke as the performance failed to turn around in 2016, with Asda revealing a new low in August with a 7.5% slump in like-for-like sales for the second quarter.

Asda blamed “fierce competition and food deflation” for the latest decline.

“The grocery market has experienced only minimal growth due to exceptional levels of price deflation caused by ever-increasing competitive conditions,” FD Alex Russo said in the directors’ report for the accounts of Asda Group Ltd.

He added that Asda’s “low cost operating model” had been fundamental to driving efficiencies and savings across stores. However, the impact of this had been “significantly” reduced in 2015 because of external fixed cost inflationary increases, especially in the areas of property, rates and utilities.

International Procurement & Logistics (IPL) division, which sources Asda’s fresh produce, wine and chilled products, continued to deliver savings and increased profits during the year. IPL expanded into sourcing ambient produce for Asda in 2015, as well as other Wal-Mart businesses globally, the accounts said.

The accounts also revealed that IPL paid £55.2m to acquire full control of meat suppliers Forza and Kober after a five-year joint venture in January.

Following the launch of George Home last year, the George brand also went from “strength to strength” with continued sales and profit growth.

Asda opened 37 stores in the period, including eight superstores and 29 small shops such as standalone petrol stations. This added 403,000 sq ft to the retailer’s portfolio.

Its market share shrank another 0.5% to 16.6% in the 52 weeks ended 3 January, according to Kantar.

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