Wal-Mart international growth slows, shares fall

BENTONVILLE, Ark., Fri Aug 17, 2012 – Wal-Mart Stores Inc.’s full-year profit may miss analysts’ expectations as growth slows in its international markets, pressuring the company even as its U.S. discount stores continue to prosper.

The world’s largest retailer, viewed as a barometer of economic activity, said on Thursday its cash-strapped customers tend to spend more at the beginning of the month when they get their paychecks. That “paycheck cycle” has extended its reach to the company’s markets beyond the United States.

“It became more pronounced across the globe,” CFO Charles Holley told reporters, without naming any specific markets where he sees the shift.

Wal-Mart’s higher second-quarter profit narrowly beat the average estimate of analysts polled by Reuters. While the company raised its earnings outlook for the full year, that could still miss analysts’ expectations.

Wal-Mart shares were down 3.4 percent at $71.91, erasing recent gains, and were the worst performer in the Dow Jones industrial average in afternoon trading.

In the United States, Wal-Mart’s largest market, shoppers’ top concerns are employment, gas prices and higher food costs, Holley said.

Other retailers, too, added to concerns about the plight of lower-income U.S. consumers.

Dollar Tree Inc. forecast quarterly earnings below Wall Street estimates on Thursday. And Sears Holdings Corp. said U.S. same-store sales fell 4.7 percent at the Kmart discount chain.

Still, Wal-Mart plans to open more stores and expects growth across its regions, but, as it has said earlier this year, will slow down store openings in Brazil, China and Mexico.

In Brazil and China, where it has hundreds of stores, it wants to “let them catch their breath” and work on moving to everyday low pricing and improving profitability, Holley said.

At the same time, the store approval process in Mexico has slowed and become more complex in the wake of allegations the company had bribed government officials to speed up approvals.

PMG International ex-chairman joins Wal-Mart board

BENTONVILLE, Ark., Mon Jul 30, 2012 – Wal-Mart Stores Inc. on Monday said that the retired chairman of accounting and consulting firm KPMG International KPMG.UL has joined its board of directors, effective immediately.
Timothy Flynn, 55, will serve as a member of the retailer’s audit committee and becomes the seventeenth member of Wal-Mart’s board.
Flynn joined the board of JPMorgan Chase & Co. earlier this year.
Wal-Mart has been embroiled in a bribery scandal at its Mexican operations, which are the subject of investigations by the U.S. Justice Department and the U.S. Securities and Exchange Commission.
In April, a New York Times report said that management at Wal-Mart de Mexicob orchestrated bribes of $24 million to help it grow quickly in the last decade and that Wal-Mart’s top brass tried to cover it up.

Wal-Mart bribery review includes Brazil, China

WASHINGTON, Tue Jun 12, 2012 – Lawyers for Wal-Mart Stores Inc. have flagged Brazil, China, India and South Africa in addition to Mexico, as countries that represent the highest corruption risk in a global review, according to a letter from lawmakers investigating the company.

The lawyers said they were retained to review Wal-Mart policies in Mexico, Brazil and China, and later recommended the company also evaluate its operations in India and South Africa. The lawyers referred to those five countries as regions where the risk was the greatest, according to the lawmakers.

The company has acknowledged it is investigating bribery allegations involving its Mexican operations, and that it is conducting a global review of its anti-corruption compliance program, but has not provided details about the review.

The new details came in a letter from two Democratic lawmakers, Representatives Elijah Cummings and Henry Waxman, who are the ranking members, respectively, of the House Oversight and House Energy committees.

The pair wrote to Wal-Mart Chief Executive Michael Duke on Tuesday and asked him to provide additional documents and allow certain witnesses to cooperate with a congressional investigation into the bribery allegations.

Outside lawyers for Wal-Mart briefed the lawmakers on May 21 about the company’s program to comply with the Foreign Corrupt Practices Act, a 1970s-era law that bars bribes to officials of foreign governments.

But the lawyers did not answer any questions about the substance of the bribery allegations, which were brought to light in an April 21 New York Times report that said that management at Wal-Mart de Mexico orchestrated bribes of $24 million to help it grow quickly in the last decade and that Wal-Mart’s top brass tried to cover it up.

The two lawmakers have previously expressed frustration about the information they have received from Wal-Mart.

Wal-Mart representatives did not immediately respond to a request for a comment, but the company has said it is “committed to a full and independent investigation,” and that “it would be inappropriate for us or others to come to conclusions before the investigation is complete.”

‘No’ votes jump against Wal-Mart’s Duke, directors

BENTONVILLE, Ark., Wal-Mart Stores Inc. CEO Michael Duke, Chairman Rob Walton and former CEO Lee Scott received a far higher percentage of votes against re-election to the board of directors this year than last in the wake of Mexican bribery allegations.

The officials were targeted by large pension funds and activist groups after allegations its Wal-Mart de Mexico unit bribed officials to expand quickly last decade and that management squelched an internal investigation.

Scott, who was CEO of the world’s largest retailer at the time, received the most votes against, 15.65 percent of shares voted, according to Wal-Mart. A total of 13.1 percent voted against Duke, who was president of Wal-Mart International during the investigation, while 12.6 percent voted against Walton.

Audit Committee Chairman Christopher Williams had 13.3 percent of votes cast against him.

“It’s a strong vote of no confidence in the leadership and sends a strong message to the board,” said Michael Garland, executive director for corporate governance for New York City Comptroller John Liu.

Last year, all candidates received about 98 percent or more votes in favor of re-election, Wal-Mart said.

On Friday, Wal-Mart said all 15 board members were re-elected, a foregone conclusion as the family of founder Sam Walton controls roughly one-half of the company’s shares.

Wal-Mart urges worker integrity amid bribery probe

FAYETTEVILLE, Ark., Wed May 30, 2012 – Top executives of Wal-Mart Stores Inc. did not directly mention a Mexican bribery scandal at an employee pep rally on Wednesday, but asked their international workers to focus on “integrity” as a core value.

The world’s largest retailer has been under fire from shareholders and activists after the New York Times reported in April that management at Wal-Mart de Mexico, or Walmex, allegedly orchestrated bribes of $24 million to help it grow quickly last decade and that Wal-Mart’s top brass tried to cover it up.

The matter is being investigated by a number of government agencies in Mexico and the U.S. Department of Justice and the U.S. Securities and Exchange Commission. Wal-Mart is also conducting an internal probe.

Executives talked around the allegations in Mexico, the company’s first and largest international market. They referenced integrity as one of the company’s core values and underscored the importance of complying with local laws.

“It’s doing the right thing, every single day,” Wal-Mart President and Chief Executive Officer Mike Duke told international workers gathered at the University of Arkansas’ Barnhill Arena.

Doug McMillon, president and CEO of Walmart International, said it was up to every employee – from new associates to top executives – to guard the company’s principles.

“If you see something in your business that you don’t think is right, you need to say something,” McMillon said.

Scot Rank, president and CEO, Walmart Mexico and Central America, may have come the closest to directly commenting on the allegations, without specifically mentioning bribery.

“Over the years we have faced difficult and challenging times in Mexico and Central America. These events have united us even more, they have motivated us to continue, to continue pursuing excellence, and work with respect and integrity,” Rank said at the end of the Mexico and Central America unit’s presentation.

Major pension fund to vote against Wal-Mart board

BENTONVILLE, Ark, Tue May 22, 2012 – The second largest U.S. public pension fund said on Tuesday it plans to vote all of its Wal-Mart Stores Inc shares against the board in the wake of bribery allegations in Mexico that Wal-Mart officials failed to fully investigate.

California State Teachers’ Retirement System, or CalSTRS, has already sued current and former Wal-Mart executives, saying allegations the company paid millions of dollars of bribes in Mexico and a cover-up by Wal-Mart officials raised the question of whether top executives should remain in place.

The allegations “indicate a breakdown of corporate governance and lack of oversight that should have averted this situation,” CalSTRS said in a statement.

CalSTRs added it “does not have confidence the current board has the independence and leadership needed to address these difficult issues.”

CalSTRS plans to vote its 5.3 million Wal-Mart shares against the re-election of all board members and encouraged other shareholders to do the same.

The $153.7 billion pension fund has said as an index investor, it is required to hold shares of the retailer, which is a component of the Dow Jones industrial average and many indexes.

Shares of Wal-Mart were up 0.8 percent at $63.53 in late-morning trading after rising to $63.55, their highest level in more than 10 years, earlier in the session.

Wal-Mart posts strong quarterly profit as U.S. sales jump

BENTONVILLE, Ark., Thu May 17, 2012 – Wal-Mart Stores Inc. posted a better-than-expected quarterly profit on Thursday, including a 2.6 percent rise in sales at its Walmart U.S. division’s stores open at least a year, as warm weather and an earlier Easter enticed shoppers to spend.

The world’s largest retailer, which was recently rocked by allegations of bribery in Mexico, earned $1.09 per share from continuing operations, compared with a profit of 98 cents a year earlier.

Wal-Mart had forecast earnings per share of $1.01 to $1.06. Analysts, on average, expected it to earn $1.04 per share, according to Thomson Reuters I/B/E/S.

Shares of Wal-Mart jumped 2.8 percent to $60.85 in premarket trading.

Walmart U.S. same-store sales have risen for three straight quarters following nine consecutive quarterly declines. Wal-Mart expected Walmart U.S. same-store sales to be flat to up 2 percent. Analysts, on average, expected them to rise 1.4 percent, according to Thomson Reuters.

For the current second quarter, Wal-Mart expects to earn $1.13 to $1.18 per share from continuing operations. Analysts were looking for a profit of $1.16 per share.

Walmart U.S. same-store sales should rise 1 percent to 3 percent this quarter, Walmart U.S. Chief Executive Bill Simon said on a recorded call.

Compensation for Wal-Mart CEO Mike Duke dipped last year

BENTONVILE, Ark., Mon Apr 16, 2012 – Wal-Mart Stores Inc. CEO Mike Duke earned $18.1 million last year, down from $18.7 million in the previous year, as sales growth at the world’s largest retailer fell short of its goals.

Wal-Mart also said Google Inc. executive Marissa Mayer would stand for election to the Wal-Mart board at the company’s annual shareholders meeting on June 1. If elected, Mayer would become the sixteenth member of the board.

While the huge Walmart U.S. business finally reversed its prolonged sales slump last year, overall performance and results at both Walmart U.S. and the international unit fell short of the company’s expectations.

Duke’s cash incentive payment in fiscal 2012 fell to just under $2.88 million from $3.85 million a year earlier and $4.8 million in fiscal 2010, Wal-Mart said in a regulatory filing on Monday.

Duke earned 71 percent of his target cash incentive payment for fiscal 2012, down from 97.4 percent in fiscal 2011 and 125 percent in fiscal 2010.

The board’s nomination of Mayer, 36, underscores Wal-Mart’s desire to become a better online and mobile destination for its shoppers. Mayer joined Google in 1999 as its first female engineer and has been its vice president of local and maps since 2010.

“We are on the cusp of a massive transformation in the way people shop in our increasingly connected world,” Wal-Mart Chairman Rob Walton said in a statement. “Marissa’s insights and expertise in the technology and consumer areas are valuable assets to Walmart as we move forward.”

Wal-Mart profit below Wall St despite better sales

BENTONVILLE, Ark. ― Wal-Mart Stores Inc’s quarterly profit growth missed Wall Street’s expectations on Tuesday, as the economy continues to weigh on customers at Walmart U.S., by far the company’s largest division.

Still, key sales at those U.S. discount stores rose more than expected, reversing a string of nine quarterly declines.

Shares of Wal-Mart, the world’s largest retailer, were down 1.8 percent at $57.93 in premarket trading.

Wal-Mart earned $3.34 billion, or 97 cents per share, from continuing operations in the third quarter ended on Oct. 31, compared with $3.44 billion, or 95 cents per share, a year earlier. There were fewer shares outstanding during the most recent quarter.The company had forecast a profit of 95 cents to $1.00 per share. Analysts on average expected 98 cents, according to Thomson Reuters I/B/E/S.”Every business segment is stronger today than it was a year ago,” Chief Executive Officer Mike Duke said in a statement.

Sales momentum at Walmart U.S. and the Sam’s Club warehouse chain position the company “exceedingly well for the holidays,” Duke added.

Net sales rose 8.2 percent to $109.5 billion.

Sales at U.S. discount stores open at least a year rose 1.3 percent. That topped the company’s forecast, which called for Walmart U.S. same-store sales, excluding fuel, to be down 1 percent to up 1 percent. It also exceeded the analysts’ average forecast for a rise of 0.3 percent, according to Thomson Reuters data.

Wal-Mart forecast fourth-quarter earnings of $1.42 to $1.48 per share from continuing operations, up from $1.41 a year earlier. That would lead to full-year earnings per share from continuing operations of $4.45 to $4.51, up from $4.18 last year.

Wal-Mart U.S. same-store sales up in last three months

BENTONVILLE, Ark. ― Wal-Mart Stores Inc is finally seeing sustained improvement at its U.S. discount chain, with sales at Walmart stores open at least a year rising for three months straight, Walmart U.S. Chief Executive Bill Simon said on Wednesday.

Walmart is also gearing up to open up to 385 U.S. stores over the next two years, most of them supercenters, as it tries to retain and expand its dominance in the U.S. retail industry.

Shares of Wal-Mart jumped 2.5 percent to $56.10 in late morning trading.

Same-store sales account for about 98 percent of Walmart’s total sales in the United States, so fixing the slump at existing stores is critical for the world’s largest retailer.

Walmart U.S., by far the company’s largest business, has posted nine consecutive quarters of same-store sales declines. While such sales rose in July, the last month of the fiscal second quarter, same-store sales fell 0.9 percent in the quarter.

Walmart U.S. same-store sales continued to rise in August and September, Simon said at Wal-Mart’s 18th annual meeting for the investment community in Rogers, Arkansas, which is also being broadcast over the Internet. Traffic in stores has increased, led by traffic in the food department, Simon said.

For the current third quarter, the company previously said Walmart U.S. same-store sales should be down 1 percent to up 1 percent.

Walmart opened about 153 U.S. stores and spent about $7.3 billion on capital expenditures in fiscal 2011. Now, the company is preparing to open many more stores at a lower cost.

In total, the company plans to open 142 to 150 U.S. stores this fiscal year, which ends in January. It plans to spend $6.5 billion to $7 billion on capital expenditures this fiscal year.

Walmart currently has five Walmart Express stores, which it began testing in June. It plans to have 11 by the end of the fiscal year, said Karen Roberts, president of Walmart Realty.

In fiscal 2013, Walmart plans to open 210 to 235 U.S. Walmart stores and spend $6 billion to $6.5 billion on capital expenditures.

Walmart U.S. plans to open 130 to 135 supercenters and 80 to 100 small-to-medium stores next year, Roberts said.