Asda avoids penalty amid missed deadline for IT upgrade

Asda has reportedly avoided a financial penalty after its former owner Walmart agreed to move back a deadline for the supermarket to hit its £800m IT upgrade.According to The Telegraph, the supermarket missed the initial deadline for a tech overhaul that aims to separate its computer systems from those of the US chain.

Asda had been attempting to untangle “thousands” of programmes from Walmart that are responsible for checkouts, administration and payroll, in order to avoid a penalty charge for the continued use of the technology.

The changeover, named Project Future, was meant to be completed by February, and sources warned the Telegraph that Asda risked millions of pounds worth of charges if it missed the deadline. 

According to the paper however, Walmart and Asda have now revised their agreement and scrapped the February deadline. 

Lord Rose, former chairman of the supermarket, last year told the Telegraph that there was “an incentive for us to come off their system, but it’s not meaningful in the company’s profit and loss”, adding, “it is not £15m a week, but there is an incentive for us to finish this on time”.

A spokesman for Asda told The Telegraph: “We continue to make good progress delivering Project Future and have successfully migrated large parts of our business to brand-new systems. We will continue to take a pragmatic approach when delivering the remainder of the programme and Walmart continues to be incredibly supportive in every way in helping with the implementation.”

The supermarket was sold by Walmart in 2021 to TDR Capital and Mohsin and Zuber Issa.