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Wal-Mart Stores’ profit falls 4.2%, but U.S. sales on the rise

BY Marianne Wilson

Bentonville, Ark. — Wal-Mart Stores Inc.’s fiscal fourth-quarter profit dropped 4.2% on higher costs, but its U.S. business continued to draw in more shoppers.

Net income was $5.16 billion in the three months ended Jan. 31, compared with $6.05 billion in the year-ago period.

Net sales, excluding membership fees from its Sam’s Club division, rose 5.8% to $122.3 billion. International sales rose 13%, and U.S. sales rose 2.4%.

The company’s namesake U.S. business had a 1.5% in same-store sales, its second consecutive quarterly gain. The company noted that it saw an increase in customer traffic, reversing more than several years of declines in customer counts.

“We are pleased with Walmart¹s earnings performance for both the fourth quarter and the full year,” said Mike Duke, Wal-Mart Stores Inc. president and CEO. “Today, every segment of our business is stronger than it was a year ago, and we’re in a great position for fiscal year 2013.”

Duke said Walmart would continue to lower prices in the coming year and that positive trends will continue.

“Core customers remain cautious about their finances,” he said. “They rely on Walmart’s [everyday low price] promise to help them manage through today’s economic challenges.”

For the year, Walmart¹s sales increased 5.9% to $443.9 billion. During the year, Walmart added 119 supercenters and 27 small formats for a total of 9.6 million new sq. ft.

In 2012, between 210 and 235 new units are planned with 80 to 100 of those being small formats, primarily Neighborhood Markets.

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Mild weather warms up Home Depot sales

BY CSA STAFF

ATLANTA — Boosted by mild temperatures and spring-like selling conditions throughout much of the country, Home Depot saw sales rise nearly 6% in the fourth quarter.

The home improvement giant reported fourth-quarter sales of $16.0 billion, up 5.9% from the same quarter last year. Comparable store sales were positive 5.7%, and up 6.1% in the United States.

"We had a strong finish to 2011, and with favorable weather, our business delivered results that exceeded our expectations," said CEO Frank Blake.

The performance also exceeded the expectations of most of analysts on Wall Street, where expectations had called for about $15.5 billion in sales for the quarter.

Net earnings for the fourth quarter were $774 million, up 31.9% from the fourth quarter last year.

For the full year, Home Depot’s sales increased 3.5% to $70.4 billion, as comp-store sales increased 3.4% in total, and increased 3.0% in the U.S. Earnings for the full year were $3.883 billion, up 16.3% from earnings of $3.338 billion in 2010.

Looking ahead to 2012, Home Depot expects sales growth of about 4%, including an extra week in the upcoming fiscal year. The company also plans 11 new stores in 2012.

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Walmart had a “great” Christmas

BY CSA STAFF

BENTONVILLE, Ark. — Walmart’s U.S. stores division regained customer traffic during the fourth quarter to post a 1.5% same-store sales increase and continues gather momentum as familiar strategies and effective marketing are resonating with customers, the company said Tuesday morning in conjunction with the release of quarterly results.

Total sales increase by 5.8% to $122.3 billion, profits from continuing operations increased 3.4% to nearly $5.2 billion and earnings per share from continuing operations increased 7.5% to $1.44 from $1.34 if one time gains are excluded from both reporting periods.

“We are pleased with Walmart’s earnings performance for both the fourth quarter and the full year,” said Mike Duke, Wal-Mart Stores Inc. president and CEO. “Today, every segment of our business is stronger than it was a year ago, and we’re in a great position for fiscal year 2013.

As in the past, Duke asserted that Walmart remains the best positioned global retailer and touched on progress made in the United States where divisional president and CEO Bill Simon and chief merchandising office Duncan Mac Naughton have spent the past year implementing a back-to-basic strategy focused on asserting price leadership, controlling expenses, enhancing product assortment and ensuring products are on shelves. Progress on all those fronts is why Duke said Walmart had a great Christmas and, “the plan that Bill and his team put in place a year ago was the right plan.”

Duke said Walmart would continue to lower prices in the coming year and that positive trends will continue.

“Our price leadership is making a difference across the United States, as many families are settling into a new normal. Core customers remain cautious about their finances, and they rely on Walmart’s EDLP promise to help them manage through today’s economic challenges.”

While the comps increase was noteworthy and toward the upper end of the company’s guidance range that called for flat to a 2% increased, the bigger deal was the increase volume of customers who shopped at Walmart during the quarter.

Simon said it was “the first positive traffic quarter in quite awhile,” thanks to the addition of 10,000 items to the product mix and advertising that effectively conveyed Walmart’s core value proposition of low prices on a broad and in-stock assortment of merchandise.

“Our business models is working and we continue to drive progress on three major front,” Simon said, referring to price leadership, expanded assortment and on-shelf availability.

During the year, Walmart added 119 supercenters and 27 small formats for a total of 9.6 million new sq. ft.. This year, between 210 and 235 new units are planned with 80 to 100 of those being small formats, primarily Neighborhood Markets.

Looking abroad, Walmart’s international division also made a meaningful contribution to growth as sales increased 13.1% to nearly $35.5 billion.

Momentum continued as Sam’s Club where, excluding fuel, same-store sales increased 5.4% and total sales increased 5.4% to $12.6 billion.

For the year, Walmart’s sales increased 5.9% to $443.9 billion and full-year profits increased 2.7% to $15.8 billion. The company ended the year with 10,130 stores operating under 69 different banners in 27 countries and more than 2 million employees.

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