• Clamouring for action

    2017 will see battles not just between politicians but also those tired of politicking, says Daniel Silke.

  • Realistic dreaming

    Preparation and sound advice will turn entrepreneurial dreams into reality, says Ian Mann.

  • SA versus Cuba

    Cuba’s successes are worth a good look with the aim of emulating them, says Mandi Smallhorne.

All data is delayed
Loading...
See More

Price cuts boost Walmart US in Q4

Feb 21 2012 16:22
Reuters
Chicago - Walmart Stores fourth-quarter profit came in just short of Wall Street's expectations, sending shares down 2.6% as it cut prices to win over US shoppers during the holiday season.

Walmart US, the biggest division of the world's largest retailer, has been lowering prices, bringing back a wider variety of items and focusing on a low price message to woo shoppers on limited budgets who started to shop at dollar stores and elsewhere in recent years. Traffic at those stores rose after six quarterly declines.

Walmart US posted a 1.5% increase in sales at stores open at least a year. It was the second quarter in a row that Walmart US same-store sales rose after nine consecutive quarterly declines.

However, operating income growth at Walmart US grew at a slower rate than sales. Gross profit margin declined as the company made investments in its pricing strategy.

The rise in sales was also not as strong as analysts expected. Wal-Mart expected Walmart US same-store sales would be flat to up 2%, compared with a 1.8% drop a year earlier. Analysts on average had expected a rise of 1.8%, according to Thomson Reuters data.

Shares of Wal-Mart, which were up 4.6% so far this year through Friday's closing price of $62.48, fell $1.65, or 2.6%, to $61.20 in premarket trading.

Wal-Mart earned $5.19bn or $1.51 per share from continuing operations attributable to the company, up from $5.02bn or $1.41/share a year earlier.

Excluding about 7 cents per share from certain tax matters and real estate transactions, Wal-Mart earned $1.44/share. The company had forecast a profit of $1.42 to $1.48 per share, which did not include the benefits.

Analysts, on average, expected it to earn $1.45/share, according to Thomson Reuters I/B/E/S.

Sales rose 5.8% to $122.29bn.

Wal-Mart forecast first-quarter earnings per share from continuing operations attributable to the company of $1.01 to $1.06, compared with a profit of 98c/share a year earlier, which included a lift of 1c from multiple items.

The company expects Walmart US same-store sales to be flat to up 2% in the first quarter.

It forecast fiscal year earnings per share from continuing operations attributable to the company of $4.72 to $4.92. In fiscal 2012 it earned $4.54/share, including 5c of benefits.

Wal-Mart's international business grew at a faster clip than the larger Walmart US. Operating income at Walmart International rose 15.2% to nearly $2.31bn, while Walmart US operating income rose 1.4% to $6.11bn.

On Monday, Wal-Mart said it was taking a controlling stake in Chinese e-commerce company Yihaodian to expand its international reach.
walmart

NEXT ON FIN24X

Assore to get new CEO

2016-12-06 12:24

 
 
 

Read Fin24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
0 comments
Comments have been closed for this article.
 

Company Snapshot

We're talking about: SMALL BUSINESS

From fossils to finance – that’s been the career trajectory of Dr Merrill van der Walt, a palaeontologist until recently. She is now a statistician with a difference.
 

Money Clinic

Money Clinic
Do you have a question about your finances? We'll get an expert opinion.
Click here...

Voting Booth

SA's avoidance of junk status by rating agencies: Moody's and Fitch

Previous results · Suggest a vote

Loading...