Wal-Mart's 4Q Saw 1.5 Percent Rise in US Same-Store Sales

  on February 21 2012 7:52 AM

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.

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.

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