Asda, the UK retailer, has posted a fall in profits for 2010 due to a rise in share option costs and an increase in royalties to parent company Wal-Mart Stores.
In a filing with Companies House, Asda said its net profit fell 6.5% to GBP608m (US$945.9m) in the year to 31 December.
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The UK’s second-largest retailer said it paid Wal-Mart GBP137m more in technical assistance, services and royalties in 2010. The company also paid GBP17.9m more in share options during the year.
Asda, meanwhile, saw its operating profit drop 10.5% to GBP805.1m. However, the retailer said operating profit minus the charges from technical assistance, services, royalties and the share options was up 6.4% to GBP1.02bn.
Revenue was up 3.6% to GBP20.55bn, with like-for-like sales, excluding petrol and VAT, increasing 0.6%.
“2010 was a successful year for Asda,” the company reported. It said that operating profit, excluding the payments to Wal-Mart and share option costs, grew at a faster rate than sales.
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