FINANCE

Wal-Mart Q1 earnings rise on overseas strength, U.S. still slumping

BY CSA STAFF

Bentonville, Ark. — Wal-Mart Stores reported Tuesday that net income for the first quarter ended April 30 rose 3% to $3.39 billion, beating Wall Street estimates. Overall results were powered by overseas stores and stringent cost controls, but business in the United States remains soft as U.S. Walmart stores posted an eighth straight quarter of same-store declines.

Wal-Mart’s U.S. division recorded a 0.3% dip in same-store revenue, dragged down by a 1.1% drop at its namesake stores. Same-store sales increased 4.2% at Sam’s Club warehouse stores.

Revenue system-wide rose 4.4% to $103.4 billion, beating Wall Street estimates of $102.8 billion.

Wal-Mart has issued a cautious second quarter outlook, citing concerns that rising gas and grocery prices would negatively impact its low-income customers.

"We are monitoring the economic environment carefully, as significant changes in gas prices and inflation during the quarter will influence our actual performance," Bill Simon, Walmart U.S. president and CEO, said in a statement.

Wal-Mart’s international business saw revenue rise 11.5% to $27.9 billion in the first quarter, led by the biggest gains in Mexico, China and Chile. Revenue grew strongly in all international markets except Japan, which was hurt by the earthquake and tsunami.

Sam’s Club revenue rose 9.4%. It accounts for about 12% of company revenue. Wal-Mart’s U.S. division revenue edged up 0.6% on increased store counts.

In April, CEO Mike Duke indicated that U.S. store momentum is a "critical priority." It has been re-focusing on low prices and growing its merchandise after cutting back in some categories to combat rising inflation, high unemployment and a weak housing market.

In other news reported Monday, Wal-Mart threatened to walk away from a proposed $2.4 billion acquisition of South African retailer Massmart if conditions are imposed following recommendations by the country’s Competition Commission. The deal is important for Wal-Mart as it seeks a foothold to tap into Africa’s growing consumer class.

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J.Smith says:
Mar-29-2012 01:30 pm

Volatile gas prices have
Volatile gas prices have taken center stage in the media this year as the national average for a gallon of gasoline has topped $4. Political unrest, the impending hurricane season, flooding in the Mississippi and increased demand during the summer driving season could push prices even further. At the individual level, higher gas prices mean that each of us will pay more at the gas pump, leaving less to spend on other goods and services. But higher gas prices affect more than just the cost to fill up at the gas station and number of requests for pay day advance UK; higher gas prices have an effect on the broader economy.

J.Smith says:
Mar-29-2012 01:30 pm

Volatile gas prices have taken center stage in the media this year as the national average for a gallon of gasoline has topped $4. Political unrest, the impending hurricane season, flooding in the Mississippi and increased demand during the summer driving season could push prices even further. At the individual level, higher gas prices mean that each of us will pay more at the gas pump, leaving less to spend on other goods and services. But higher gas prices affect more than just the cost to fill up at the gas station and number of requests for pay day advance UK; higher gas prices have an effect on the broader economy.

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News

Home Depot boosts earnings 12% in first quarter

BY CSA STAFF

Atlanta-based Home Depot reported first quarter earnings of $812 million, up 12% from earnings of $725 million in the first quarter last year.

Sales declined 0.2% to $16.8 billion, while comparable store sales were negative 0.6%. Comp-store sales for stores in the United States were negative 0.7%.

"We continued to improve our business and delivered double-digit earnings growth," said Frank Blake, chairman & CEO. "Our sales declined slightly due to a slow spring selling season, but for the year we expect sales to grow in line with the guidance we previously provided."

Home Depot said it expects fiscal 2011 sales will be up approximately 2.5% from fiscal 2010. Based on its year-to-date performance, the Company raised its fiscal 2011 diluted earnings-per-share guidance and now expects diluted earnings per share to be up approximately 11.4% to $2.24 for the year.

Speaking on an earnings call, The Home Depot’s EVP merchandising Craig Menear said he was pleased with the company’s first-quarter performance in its core business. Despite the slight comps decline,several categories were positive — electrical, kitchens, tools, plumbing, paint and flooring. Hardware also outperformed the company’s average comp for the quarter, he said.

The retailer saw positive comps in all hard surface categories in flooring, as well as organization, interior paint and faucets. The outdoor sales were impacted by bad weather.

"Looking ahead, we continue to believe transaction improvement will lead to growth in the first half of the year, and improvement in average ticket will be more sustaining in the back half of the year," Menear said.

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REAL ESTATE

Voorhees Town Hall opens at Voorhees Town Center

BY CSA STAFF

Voorhees, N.J. — Philadelphia-based Pennsylvania Real Estate Investment Trust announced Monday that Voorhees Town Hall has opened at the mixed-use Voorhees Town Center, located in Voorhees, N.J.

On Monday, more than 50 Voorhees Township employees moved in to the new municipal office, which is located on the upper level of the mall across from Macy’s and also features a street-level entrance.

“The addition of Voorhees Town Hall solidifies Voorhees Town Center as a true town center for local residents,” said Joseph Coradino, president, PREIT Services, LLC and PREIT-RUBIN. “Voorhees Town Center is now a place where people of all ages can shop, dine, work, live, conduct business and enjoy community events.”

Voorhees Town Center is one of only three nationwide anchored by a municipal office. It is a new type of anchor, an innovative alternative use that benefits both parties.

The 24,300-sq.-ft. municipal offices at Voorhees Town Center will provide added convenience for Voorhees Town Hall visitors and employees including free parking, easy accessibility and on-site dining and shopping. It also lowers the cost for municipal operations and is an upgraded facility that is more environmentally friendly.

The opening of Voorhees Town Hall is part of Voorhees Town Center’s $150 million mixed-use, smart-growth redevelopment, the first of its type and scale in Southern New Jersey. The four-pronged project includes a renovated two-level mall, an award-winning office building, 425 luxury residential apartments and condominiums, and main street retail, restaurants and services.

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