LONDON (Reuters) - Asda, Britain's third largest supermarket group, said on Friday its underlying sales rose 1.4% in the first quarter - a slowdown from growth of 2.2% in the previous quarter and an underperformance versus its bigger rivals.

The grocer, owned by brothers Zuber and Mohsin Issa and private equity group TDR Capital, said total revenue, excluding fuel, rose 6.6% to 5.3 billion pounds ($6.7 billion) in the three months to March 31.

Monthly industry data has consistently shown Asda underperform its main rivals - industry leader Tesco and No. 2 Sainsbury's.

According to data from market researcher Kantar, Asda's sales fell 0.4% over the 12 weeks to April 14, with its market share falling 60 basis points year-on-year to 13.4%.

Nevertheless, Mohsin Issa said Asda "made good progress against its strategy in the quarter, laying the foundations for long-term success."

He pointed to the completion of the conversion of 470 convenience sites acquired from the Co-op and EG UK to Asda Express, increasing its total store estate to over 1,200 sites.

In January, Asda started matching the prices of discounters Aldi and Lidl on hundreds of comparable grocery products.

"We're confident we're doing the right things for the long term," chief financial officer Michael Gleeson told reporters.

Asda has been burdened by high debt levels since the Issas and TDR bought the business from Walmart in a 6.8 billion pound deal in 2020 which left the U.S. giant retaining a 10% stake. Asda's interest costs in 2023 were 225 million pounds.

Earlier this month, Asda refinanced over 3.2 billion pounds of debt.

Asda has been without a CEO since Roger Burnley left abruptly in 2021. Gleeson said the search was ongoing with headhunters appointed.

He declined to comment on media reports that Zuber Issa was looking to offload his 22.5% stake.

($1 = 0.7905 pounds)

(Reporting by James Davey; editing by Sarah Young)

By James Davey