Sales at Asda were up for a sixth straight quarter, thanks to strong sales of own-label products and growth in new customers.
For the three month period ending September 30, the Walmart-owned retailer reported a 3.7 per cent rise in underlying sales.
Meanwhile like-for-like sales rose two per cent, a marked increase on the 0.4 per cent like-for-likes rise recorded in the previous quarter.
Asda said its performance was boosted by an additional 115,000 customers choosing to to shop at the supermarket, and growth in its own-brand offerings.
However, the Big 4 grocer warned that its gross profit rate declined, which it attributed to price cuts in a highly competitive market.
“In a challenging third quarter for the market we continued to focus on the areas that we know are important to our customers and deliver on our strategic priorities,” chief executive Roger Burnley said.
“As a result we were pleased to welcome an additional 115,000 customers through our doors and outperform the market for the second quarter running.
He added: “During the quarter we continued to grow our distinct Own Brand offer, including the expansion of our Free From range to include 113 new lines, as well as expand scan and go to 192 stores.
“We were delighted to work with Denbies in Surrey to launch our first English Sparkling Wine and we also opened our first two food re-distribution centres in the East Midlands and Leeds as part of our ground-breaking Fight Hunger Create Change programme with FareShare and the Trussell Trust.
“As we enter what will undoubtedly be an incredibly competitive festive trading period, our stores are fully prepared to bring Christmas home for our customers.”
Asda added that ongoing communication from the CMA on the proposed £12 billion merger with Sainsbury’s was in-line with its expectations.
The CMA last month it expected to issue provisional findings on its probe early next year.