Wal-Mart Disappointed With 5.8% Growth
Bentonville, Ark., Wal-Mart Stores, Inc. reported record second-quarter sales and earnings for the quarter ended July 31, 2005. Net sales were $76.8 billion, an increase of 10.2% over the second quarter of fiscal 2004. Net income for the quarter was $2.8 billion, an increase of 5.8% from $2.7 billion in the prior-year quarter.
Still, the quarter revealed the most modest growth in four years, disappointing company executives. Lee Scott, president and CEO, said, “Early in the quarter, our results were disappointing; however, July came in stronger than expected. Wal-Mart Stores did miss their plan as our customer continues to be impacted by higher gas prices and it is difficult to improve our expense leverage in the current environment.”
Total U.S. comparable sales for the quarter increased 3.5%, which is represented by a 3.6% comp increase for Wal-Mart Stores and a 2.9% comp increase for Sam’s Club. Total U.S. comparable sales for the six-month period were up 3.2%, which is comprised of a 3.2% comp increase for Wal-Mart Stores and a 3.2% comp increase for Sam’s Club.
Net sales for the six months ended July 31 were $147.7 billion, an increase of 9.8% over the first six months of fiscal 2005. Net income for the six months increased 9.3% to a record $5.3 billion, up from $4.8 billion in the same prior-year period. Net income for the six months was favorably impacted by two items totaling $145 million after tax or $0.03 per share: an increase due to favorable tax resolutions of $77 million and positive legal developments of $68 million after-tax.
Great Atlantic & Pacific Tea Co. Finalizes Sale of A&P Canada
Montvale, N.J., The Great Atlantic & Pacific Tea Company has announced that it has completed the sale of A&P Canada to Metro Inc., a supermarket and pharmaceutical operator in Quebec and Ontario, Canada, for approximately $1.55 billion.
OfficeMax Consolidates Corporate Headquarters
Itasca, Ill., OfficeMax Inc. will consolidate its headquarters in Illinois. It expects to choose a Chicago-area location for the headquarters by the end of September 2005. Currently, OfficeMax’s corporate headquarters is located in Itasca, Ill., and its retail headquarters is in Shaker Heights, Ohio.
Sam Duncan, president and CEO of OfficeMax, said, “Bringing our headquarters’ associates together is a normal progression of the company’s integration efforts and we believe it will facilitate customer service as well as provide better support for our retail and contract businesses. We will emphasize a smooth transition as we consolidate our headquarters, keeping the need of our customers and our associates a priority.”