Asda says it paid £1.15 billion in dividend to Walmart in March

In its annual report published on Friday, Asda said it paid Walmart Inc. (NYSE: WMT) £1.15 billion in dividend in March. Walmart is currently in the process of selling its majority stake in Asda to TDR Capital and Issa Brothers in a deal that values the British supermarket retailer at £6.65 billion.

Asda said that the dividend payment to Walmart on 5^th march was in respect to the last three financial years. In its earnings report for the fiscal third quarter published in November, Walmart said that its online sales jumped 79% amidst the COVID-19 crisis.

Walmart’s performance in the stock market

On the weekly chart, Walmart shares ended roughly 1% down on Friday. The American multinational is now close to 25% up year to date in the stock market after an over 40% recovery since March. Learn more about stock market volatility.

In comparison, Walmart performed fairly upbeat in the stock market last year with an annual gain of a little under 30%. At the time of writing, it is valued at £314.48 billion and has a price to earnings ratio of 21.22.  

To offer support to the UK-based retailers amidst the Coronavirus pandemic, Prime Minister Boris Johnson’s government had announced business rates relief on 17^th March, followed by a countrywide lockdown to minimise the fast-spread of the flu-like virus on 23^rd March.

In an announcement last week, Asda expressed confidence that it will pay back £340 million of relief. The COVID-19 crisis has so far infected more than 1.8 million people in the United Kingdom and caused over 63 thousand deaths.  

Asda’s acquisition is expected to complete in H1 of 2021

The Leeds-based grocer also highlighted on Friday that its acquisition by the private equity group and Issa Brothers was expected to complete next year in the first half, subject to approval from the regulators. The acquisition is currently under a probe from the UK CMA (Competition and Markets Authority).

Walmart had also tried to offload its stake in Asda to Sainsbury’s last year for £7.3 billion. The deal, however, failed to receive regulatory approval. Asda’s annual report on Friday also highlighted its operating profit in 2019 to have plummeted to £584.2 million from £803.2 million in fiscal 2018.

The British retailer’s sales remained unchanged at £22.9 billion in 2019. In November, Asda had reported a 2.7% annualised growth in its third-quarter comparable sales.