Wal-Mart Net Income Jumps 14 Percent
by May 26, 2003 12:00 am 65 views
Wal-Mart Stores Inc. squeezed a 14.1 percent increase in net income out of a 9.7 percent increase in revenue for the first quarter as it continued to cut back on expenses.
A weak dollar lifted the international segment’s results and helped offset disappointing U.S. sales.
Wal-Mart met analysts earnings expectations, but the $56.72 billion in revenue for the quarter ended April 30 appeared to be about $3 billion below a First Call consensus, and comparable-store sales crept up a meager 2.2 percent.
On May 13, the world’s largest retailer reported net income of $1.86 billion, or 42 cents a share, for the quarter, compared with $1.63 billion, or 37 cents a share, for the comparable quarter a year earlier.
Wal-Mart had said last week it expected to report earnings at the high end of its previous projection of 40 cents to 42 cents a share.
The company said the adoption of an accounting rule for money received from suppliers reduced earnings for the latest quarter by about $101 million, or two cents a share.
Sales rose 9.7 percent to $56.72 billion from $51.71 billion.
Wal-Mart’s international division was the shining star, generating sales of $10.28 billion, an increase of 14 percent. Sales from the Wal-Mart Stores division rose 9 percent to $38.62 billion, while the Sam’s Club warehouse segment saw sales climb 7.2 percent to $7.82 billion.
Comparable-store sales, or sales in stores open at least a year, edged up 2.2 percent.
Wal-Mart said operating profit — defined as profit before interest, unallocated corporate expenses and income taxes — rose 8.1 percent at the Wal-Mart Stores segment, to $2.75 billion.
Operating profit at Sam’s Club fell 5.6 percent to $204 million. In the international segment, operating profit jumped 13 percent to $384 million.
On a recorded earnings update, Wal-Mart CEO Lee Scott called the latest quarter one of the most “confusing” in recent Wal-Mart history because several accounting changes skewed results. He also termed sales “disappointing” and said inventory levels were too high.