PROFIT RISES AT WALMART

Walmart posted a better-than-expected quarterly profit but continued to struggle with stores in the United States. Sales at stores open at least a year fell by 1.1% in the quarter, the company said.
Earnings over all beat analyst expectations, helped by to sales strength in international stores and at Sam’s Club.

The company said profit was $3.4 billion, or 97 cents a share, up from $3.3 billion, or 87 cents a share, a yearf earlier. Wal-Mart had forecast a profit of 91 to 96 cents a share for the quarter, and analysts expected a 95-cent a share profit on average. Revenue in the period, which ended April 30 and was the first quarter of Walmart’s fiscal year, rose 4.4%, to $104.2 billion from $99.9 billion. In the United States, visits to stores fell, and that pushed the comparable-store sales lower.Walmart blamed high gas prices and worries about inflation for the decline in traffic and said its customers are still on tight budgets.

"Walmart is reporting first quarter earnings from continuing operations of $0.98 per share, which was above guidance," said Mike Duke, Walmart Stores, Inc. president and chief executive officer. "This reflects the stability and strength of our global operations. "Walmart U.S. comp sales for the first quarter were within our guidance range," Duke continued. "We recognize we still have work to do and comp sales growth remains the greatest priority for me and the entire Walmart U.S. team. The good news is that the plan Bill Simon and his team are executing is gaining traction. We're focused on delivering every day low price and a wide assortment."

Walmart said it would continue with its expansion plans in the United States, particularly with smaller stores. Its grocery-only stores, which are called Neighborhood Markets and are just over one-third the size of a typical Walmart, performed well in the quarter. There, same-store sales were up 4% as visits rose.

Walmart said that because of those results, it would open another 30 to 40 Neighborhood Markets this year. The company will also open 15 to 20 Walmart Express stores by the end of the year in urban and rural areas. At about 15,000 sq ft, they will sell groceries along with key general merchandise categories. They will also function as a depot of sorts for Walmart.com’s items: customers can order something from the extended online inventory, and pick it up at the store.
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