For the three months ended July 31, Wal-Mart Stores, Inc. delivered net income of $4.07 billion, or $1.24 per diluted share, versus $4.02 billion, or $1.18 per diluted share, in the period a year earlier, the retailer announced. Net sales were $116.22 billion versus $113.52 billion in the year-prior period, it stated.
Wal-Mart earnings per share fell a penny short of published analyst estimates.
“We delivered a solid increase in earnings per share for the second quarter,” said Mike Duke, Wal-Mart Stores president and chief executive officer, in comments on the financials announcement. “Consolidated net sales and our Walmart U.S. comp were below expectations. While the retail environment was challenging across all of our markets, the Walmart U.S. and Sam’s Club businesses improved comp sales from the first quarter, and the growth of International sales was consistent. I’m encouraged by our position to execute in the second half of the year, particularly with the steps we’re taking to improve performance. There are areas of our business where we can do a better job, and we will. I’m confident in our associates’ abilities to deliver for our customers with EDLP and for shareholders with improved expense savings.”
Comparable store sales in the Walmart U.S. division declined 0.3% in the 13-week period with comp traffic down despite an improvement of basis points from the first quarter, according to the company. Home goods categories performed better than the company average.
“While I’m disappointed in our comp sales decline, I’m encouraged by the improvement in traffic and comp sales as we progressed through the quarter,” Bill Simon, Walmart U.S. president and CEO, said. “The 2% payroll tax increase continues to impact our customer. Furthermore, we also expected an increase in the level of grocery inflation, which did not materialize in a meaningful way. We were pleased that both home and apparel had positive comps. We also continued to gain market share across several categories. According to The Nielsen Company, we gained 14 basis points of market share in the measured category of ‘food, consumables and health & wellness/OTC’ during the 13-weeks ending July 20.”
Comp stores sales at Sam’s Club, without fuel-price volatility figured in, were up 1.7% in the quarter.
“Sam’s Club generated a comp of 1.7%, without fuel for the 13-week period,” Rosalind Brewer, Sam’s Club president and CEO, noted. “Sales were up, traffic continued to improve, and comp sales were within our guidance. Response to our recent membership enhancements has been favorable, resulting in solid membership income growth and positive response to our Instant Savings Book. We were pleased with our improvement in business member traffic, reversing the decrease from the prior quarter.”