Wal-Mart 4Q profit up nicely despite U.S. sales slump
Home & Textiles Today Staff -- Home Textiles Today, February 18, 2010
Bentonville, Ark. – Exceeding both its own and Wall Street’s expectations, Wal-Mart reported earnings per share of $1.23 as consolidated operating income rose 13.8% to $7.3 billion.
Total company sales for the period ended Jan. 29 grew 4.6% to $112.8 billion. However, U.S. sales for the quarter fell 0.5% to $70.97 billion as price deflation drove down the average ticket price. Comps fell 2%, excluding fuel.
“Comparable sales for the quarter were below our guidance, although the trend improved consistently throughout the period,” said Eduardo Castro-Wright, vice chainman, Wal-Mart Stores Inc.
The U.S. division also experienced a slight decrease in traffic during the quarter, he said, “and we are accelerating the implementation of several Project Impact initiatives to drive traffic to our stores.”
At Sam’s Club, fourth quarter sales, excluding fuel, increased to $11.4 billion. Including fuel, rose 3.8% to $12.3 billion. Club comp sales, excluding fuel, rose 70 basis points. Including fuel, club comp sales increased 3.7%.
“In addition to the sales strength in fresh, health and wellness, and apparel, we continue to see good mix and profit performance in other categories, such as grocery, seasonal and home,” said Brian Cornell, president and ceo, Sam’s Club.
For the full fiscal year, the company reported earnings per share of $3.66, with consolidated operating income up 8.8% to $14.4 billion.
“Our solid results were driven by our focus on expenses and inventory management,” said Charles Holley, evp, finance and treasurer. “The U.S. operations continue outstanding success in inventory management, which contributed to consolidated inventories being down 3.9% or $1.4 billion for the same time last year.”
Total fiscal year sales climbed 1.0% to $405 billion as international sales broke past the $100 billion mark. At Walmart U.S., net sales grew 1.1% to $258 billion, but comps minus fuel were flat. Although customer traffic was rose 1.3% for the year, price deflation pushed down the average ticket.
Sam’s Club sales, excluding fuel, increased 1.7% to $43.5 billion. Including fuel, sales were $46.7 billion, down 40 basis points due primarily to lower fuel prices. Comparable club sales, excluding fuel, rose 1.4%.