In its recent annual conference for the investment community, Wal-Mart Stores Inc. announced that among its financial priorities for 2013 are new stores, reduced capital expenditure and expansion in global e-commece, including acquisitions. Wal-Mart’s next fiscal year ends Jan. 31, 2014.
The retail giant announced plans to open approximately 219 new stores— 125 supercenters, 95 to 115 small-format Neighborhood Market stores, and 14 Sam’s Clubs— in the next fiscal year.
In addition, the company reaffirmed its most recent capital expenditure forecast of $12.6 billion to $13.5 billion for the current fiscal year. The fiscal 2014 capital plan will range from $12.0 to $13.0 billion.
“Our momentum in delivering strong results continues, and we are investing for the future by creating an even stronger business,” said Wal-Mart Stores, Inc. President and CEO Mike Duke. “Strong business fundamentals are driving our top line and bottom line results. We are delivering on the productivity loop and being even more disciplined about our operating expenses and capital spending. We have a deliberate approach to how we will grow, how we will deliver further operating leverage and continue to deliver strong returns to our shareholders.
“We will continue to expand our physical presence through a variety of formats across our markets, while also investing in initiatives to enhance our operational excellence and further new e-commerce opportunities,” Duke added.
Walmart also confirmed that it remains on track to meet its commitment of reducing operating expenses as a percentage of sales by 100 basis points over five years, beginning with the current fiscal year. Savings continue to be realized through lower expenses and productivity initiatives, and the savings are reinvested in lower prices and improved international profitability, according to the company.
“We manage our capital expenditures with the same discipline we manage operating expenses,” said Charles Holley, evp and CFO for Walmart. “Walmart plans to grow total company sales 5 to 7 percent in fiscal 2014, which is projected to increase net sales by $23.0 to $33.0 billion. We expect to increase retail square footage by 3 to 4 percent next year, which would add another 36 to 40 million square feet around the world,” he added. “Operating expenses will continue to grow less than the rate of sales growth.”