Wal-Mart’s Q4 profit surges 27% on international gains; U.S. sales still lag
Bentonville, Ark. — Wal-Mart Stores reported Tuesday that earnings for the quarter ended Jan. 31 jumped 27% as its international stores posted strong results. In the United States, however, the retailer posted its seventh straight quarterly sales decline, falling short of its own projections for the holiday period.
In the fourth quarter, Wal-Mart’s profit rose to $6.06 billion, compared with $4.76 billion a year earlier. Revenue climbed 2.5% to $115.6 billion but the gains came from Wal-Mart’s international operations. U.S. sales at the namesake Walmart unit fell 0.5% to $71.1 billion, and were down 1.8% on a comparable-store basis. Wall Street had expected a 0.8% increase.
"Some of the pricing and merchandising issues in Wal-Mart ran deeper than we initially expected, and they require a response that will take time to see results," CEO and President Mike Duke said in a statement.
Going forward, the chain said it plans to focus on everyday low prices on a basket of goods, feature the broadest assortment possible and remodel Walmart stores and focus on multichannel selling to spur U.S. sales.
Proving its international strength, Wal-Mart reported fourth quarter international sales rose 8.9% to $31.4 billion, helped by particularly strong sales in Brazil, China and Mexico. Profit increased 7.1%.
However at its U.S. business, sales slid 0.5%, the second quarterly decline in a row. At Sam’s Club, revenue rose 4.4%.
Duke said in a recorded conference call Tuesday that the chain would move forward "with even greater urgency in opening small stores." The company said that it plans to open its first Walmart Express stores in the second quarter.
The company also noted during the prerecorded call that rising inflation in key raw materials such as cotton is pushing it to consolidate suppliers to improve purchasing power.
Barnes & Noble profit drops 25% in Q3
New York City — Barnes & Noble reported Tuesday that net income for the quarter ended Jan. 29 decreased 24.7% to $60.6 million, from $80.4 million a year earlier. Although the chain returned to profitability after three straight quarters in the red, its increase in revenue was lower than expected.
Overall sales were up 6.9% to $2.3 billion. Same-store sales at its namesake stores rose 7.3%; same-store sales at its college bookstore chain dropped 2.2%.
Barnes & Noble said it is suspending its dividend to preserve cash and declined to give a sales forecast for the final quarter of its fiscal year because of last week’s bankruptcy of Borders Group.
Wal-Mart de Mexico Q4 profit increases 14%
Mexico City — Wal-Mart de Mexico SA reported Tuesday that profit for the fourth quarter increased 14%, citing newly acquired stores in Central America for the improved performance.
The Mexican unit of Wal-Mart Stores said that net income rose to $539 million in the fourth quarter, up from $474 million in the year-ago period.
Revenue rose 25% to $8.3 billion.
Walmex recently acquired stores in Guatemala, El Salvador, Honduras, Nicaragua and Costa Rica.