Wal-Mart Shareholders Choose New Board Member

At its annual meeting June 1 in Fayetteville, 97 percent of Wal-Mart shareholders voted to add J. Paul Reason, president and chief operating officer of Metro Machine Corp., to Wal-Mart’s now 13-member board of directors.

Shareholders rejected a proposal that would have required the world’s largest retailer to more closely monitor possible sweatshop conditions in its factories overseas. About 91 percent of shareholders voted against the proposal, which was made by The General Board of Pension and Health Benefits of The United Methodist Church of Evanston, Ill., and other shareholders.

The vote came only two weeks after KLD & Co., the largest mutual fund aimed at social responsibility, sold its shares of Wal-Mart Stores Inc. and removed the company from the Domini 400 Social Index, saying Wal-Mart hadn’t done enough to protect workers from oppressive working conditions.

Wal-Mart argued that it already has a third-party audit system in place to “ensure that suppliers’ factories meet and adhere to the Wal-Mart Factory Certification criteria.” The process includes yearly on-site visits, accounting audits and personal interviews with workers.

• The Internet arm of Wal-Mart Stores Inc., in partnership with AOL Time Warner Inc.’s America Online, said in early June that it will launch a Web site called Wal-Mart Connect, offering Internet access to Wal-Mart customers for under $10 a month.

“Our customers are going to be able to get on the Internet, have instant messaging…for under $10 a month,” Jeanne Jackson, CEO of Walmart.com, told shareholders at Wal-Mart’s annual meeting.

Jackson said the service would be available this fall.

America Online recently said it would increase the monthly price of its AOL Unlimited Use plan by $1.95 to $23.90 in July.

• At the shareholders meeting, Wal-Mart executives said the company will add about 40 million square feet of new retail space in the United States this year despite a slowdown in consumer spending and a weak selling environment.

“Others are slowing down their programs, and we’re doing just the opposite,” Tom Schoewe, chief financial officer, told shareholders and employees gathered for the company’s 31st annual meeting.

Schoewe said Wal-Mart will add about 290 stores in the United States and expand its international operations through acquisitions or by building new stores. As of April 30, Wal-Mart had 3,153 stores in the U.S. and 1,088 in nine other countries.

The retailer said its capital expenditures for 2001 are forecast at $9 billion, about even with last year.

• On June 5, Wal-Mart said it has bought back about $300 million of its own stock in the first quarter of fiscal 2001, which ended April 20.

The company plans to buy back $2.7 billion more of its stock under a previously authorized repurchase program, it said in a quarterly statement filed with the U.S. Securities and Exchange Commission.

• Wal-Mart said sales at its stores open at least a year — “same-store” sales — rose 3.8 percent in May. The Bentonville-based company had expected an increase of 3 to 5 percent.

Total sales for the four weeks ended June 1 increased 12.5 percent, to $16.44 billion from $14.61 billion a year earlier.

Same-store sales at the company’s Wal-Mart discount stores rose 3.6 percent last month, while sales at its warehouse unit Sam’s Club rose 4.8 percent.