Shares of Wal-Mart Stores Inc. (WMT) fell nearly 4 percent, to $60.24 in mid-morning trading, after the world's biggest retailer reported a fiscal fourth-quarter earnings decline of 15 percent on higher costs, although in the U.S. it pulled in shoppers during the crucial holiday season.
The stock has risen nearly 5 percent so far this year.
Wal-Mart was cautious in its guidance, saying customers are still reluctant to return to pre-recession spending habits, meaning the company must continue a strategy of providing lower-priced merchandise, Dow Jones Newswires reported.
Our core U.S. Wal-Mart business is back on track, Chief Executive Officer Mike Duke said on a conference call, citing Arkansas-based Wal-Mart's second consecutive quarterly rise in same-store sales, among other factors.
Walmart U.S., the company's biggest division, has been lowering prices, bringing back a wider variety of items and focusing on low prices to entice shoppers on limited budgets who started to shop at dollar stores and elsewhere in recent years, Reuters noted.
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For the quarter ended Jan. 31, Wal-Mart reported a profit of $5.16 billion, or $1.50 a share, down from $6.06 billion, or $1.70 a share, a year earlier. Excluding items such as discontinued operations and tax-benefit and real estate transaction gains, earnings rose to $1.51 from $1.41. The adjusted EPS -- by 7 cents -- of $1.44 contrasts with the company's earnings guidance for the fourth quarter of $1.42 to $1.48 a share, which didn't include the benefits.
Revenue rose 5.9 percent to $123.17 billion, missing the $124.21 billion estimate from analysts polled by Thomson Reuters.
International sales were up 13 percent, as operating income increased 15 percent. U.S. sales rose 2.4 percent. On a same-store basis, excluding fuel, U.S. sales were up 1.5 percent at namesake stores and up 5.4 percent at Sam's Club warehouse clubs.
The company forecast per-share earnings from continuing operations of $1.01 to $1.06 for the current quarter and between $4.72 and $4.92 for fiscal 2013. Analysts surveyed by Thomson Reuters expect $1.05 and $4.90, respectively.
For the current quarter, the company expects same-store sales to be flat to up 2 percent at Wal-Mart and an increase between 3 percent and 5 percent at Sam's Club. Analysts have been expecting 1.8 percent growth at U.S. Wal-Mart stores.