FINANCE

Wal-Mart tops Q4 profit estimate despite lackluster sales

BY Mike Troy

New York — Walmart overcame a meager 1% same stores sales increase at U.S. stores to deliver better than expected fourth quarter profits on Thursday.

The company said total sales increased 3.9% to $127.1 billion compared to $122.3 billion last year. Without the benefit of a favorable currency exchange situation, sales would have increased a lesser 3.7% to $126.8 billion. Full year sales increased by 5% to $466.1 billion compared to last year’s total of $443.8.

Fourth quarter profits increased 7.9% to $5.6 billion and earnings per share of $1.67 were 10.6% higher than the $1.51 reported the prior year and well ahead of the company’s guidance and analysts’ consensus estimate. Walmart had forecast profits in a range of $1.53 to $1.58 and analysts were looking for $1.57.

"Walmart topped off a really good year with a solid fourth quarter, and I’m proud of what we accomplished as a team," said Mike Duke, president and CEO of Wal-Mart Stores, Inc. Every day our associates around the world deliver on our mission to help customers save money so they can live better. Together, we added $22 billion in sales to top $466 billion. Walmart U.S. was a key driver of our 5% sales increase."

The 1% U.S. comp increase was at the low end of a forecast range which called for a 1% to 3% increase and a slow start to the first quarter has the company forecasting flat same store sales.

To offset the deceleration in U.S. comps, which can be attributed to a range of external economic pressures, Walmart highlighted its volume growth and market share gains. The company said its U.S. division added more than $10 billion in net sales last year, including $4.7 billion as a result of same store sales growth. The company said it gained share in categories such as food, consumables, health and wellness, entertainment and toys.

"Despite comps at the low end of the guidance, our market share gains, as noted by Nielsen and NPD, along with our two-year positive comp trend indicates the underlying strength of Walmart’s business," said Walmart U.S. president and CEO Bill Simon. "Comp sales grew by 1% for the quarter, lapping a solid 1.5% comp last year. This represented $743 million in comp growth for the quarter."

Looking ahead, Walmart faces a challenging comparison against a first quarter 2012 U.S. comp increase of 2.6% and a variety of headwinds such as increased gas prices and reductions in take home pay. Against this backdrop, Simon expressed confidence that the company’s familiar low price strategy will continue to resonate with shoppers.

However, a slow start to February caused largely by a delay in tax refunds has dimmed enthusiasm for the first quarter and resulted in a flat same store sales forecast.

"We continue to monitor economic conditions that can impact our sales, such as rising fuel prices, changes in inflation and the payroll tax increase," Simon said.

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Demands on IT professionals rise as mobile commerce grows

BY CSA STAFF

MENLO PARK, Calif. — As mobile commerce grows in popularity, the need for IT professionals is rising, according to a new survey about IT risk factors for 2013 published by global consulting firm Protiviti. The 2013 IT Priorities Survey (www.protiviti.com/ITsurvey), designed to help IT departments classify areas in need of attention in order to better execute the function’s strategic mandate, found that IT executives are struggling to manage the wide variety of technology risk, regulatory compliance and performance challenges that now face them.

When asked to assess their competency in key areas of IT technical knowledge on a scale of one to five, with one being the lowest and five being the highest, nearly 200 CIOs, chief technology officers, chief security officers, and IT vice presidents/directors reported a 2.8 average rank for social media security, social media integration, mobile commerce security, mobile commerce integration, and mobile commerce policy.

"The continued rapid global expansion of the smart phone and mobile applications marketplace reflects the strong demand from business leaders and consumers for access to information anytime and anywhere, which presents exciting opportunities for delivering value. However, it also creates greater technology risk potential," said Kurt Underwood, a managing director with Protiviti and leader of the firm’s global IT consulting unit. "The result is significant pressure on IT departments and business leaders as they are asked to deliver more mobile technology-enabled services. This pressure forces them to take on considerably more risk than they’re prepared for – especially in terms of policy, integration, data management, security and data privacy related to mobile commerce and social media proliferation and innovation."

Among 21 areas of technical knowledge, survey respondents identified social media security and mobile commerce security as the areas needing most improvement. CIOs and their staffs indicated that they intended to strengthen their cyber security capabilities in order to tackle the growing threat of breaches ‑ and potential incident response procedures ‑ as well as ensuring their compliance with the increasing number of state and federal information security requirements.

Executive-level respondents also rated mobile commerce security, policy and integration among their top five priorities in the new survey’s technical knowledge section, which contrasts strongly with the 2011 survey in which none of these areas made the top of the list. Interestingly, challenges related to virtualization and cloud computing receded in the rankings compared to 2011, suggesting IT departments have a higher level of confidence in managing these areas.

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Sales soft, but Walmart beats profit forecast

BY CSA STAFF

Walmart overcame a meager 1% same stores sales increase at U.S. stores to deliver better than expected fourth quarter profits on Thursday.

The company said total sales increased 3.9% to $127.1 billion compared to $122.3 billion last year. Without the benefit of a favorable currency exchange situation, sales would have increased a lesser 3.7% to $126.8 billion. Full year sales increased by 5% to $466.1 billion compared to last year’s total of $443.8.

Fourth quarter profits increased 7.9% to $5.6 billion and earnings per share of $1.67 were 10.6% higher than the $1.51 reported the prior year and well ahead of the company’s guidance and analysts’ consensus estimate. Walmart had forecast profits in a range of $1.53 to $1.58 and analysts were looking for $1.57.

"Walmart topped off a really good year with a solid fourth quarter, and I’m proud of what we accomplished as a team," said Mike Duke, president and CEO of Wal-Mart Stores, Inc. Every day our associates around the world deliver on our mission to help customers save money so they can live better. Together, we added $22 billion in sales to top $466 billion. Walmart U.S. was a key driver of our 5% sales increase."

The 1% U.S. comp increase was at the low end of a forecast range which called for a 1% to 3% increase and a slow start to the first quarter has the company forecasting flat same store sales.

To offset the deceleration in U.S. comps, which can be attributed to a range of external economic pressures, Walmart highlighted its volume growth and market share gains. The company said its U.S. division added more than $10 billion in net sales last year, including $4.7 billion as a result of same store sales growth. The company said it gained share in categories such as food, consumables, health and wellness, entertainment and toys.

"Despite comps at the low end of the guidance, our market share gains, as noted by Nielsen and NPD, along with our two-year positive comp trend indicates the underlying strength of Walmart’s business," said Walmart U.S. president and CEO Bill Simon. "Comp sales grew by 1% for the quarter, lapping a solid 1.5% comp last year. This represented $743 million in comp growth for the quarter."

Looking ahead, Walmart faces a challenging comparison against a first quarter 2012 U.S. comp increase of 2.6% and a variety of headwinds such as increased gas prices and reductions in take home pay. Against this backdrop, Simon expressed confidence that the company’s familiar low price strategy will continue to resonate with shoppers.

However, a slow start to February caused largely by a delay in tax refunds has dimmed enthusiasm for the first quarter and resulted in a flat same store sales forecast.

"We continue to monitor economic conditions that can impact our sales, such as rising fuel prices, changes in inflation and the payroll tax increase," Simon said.

 

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