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Wal-Mart Q4 Profit Rises, Sees Q1 EPS Below View


Retail giant Wal-Mart Stores Inc. (WMT) on Thursday reported higher profit for the fourth quarter, and boosted its dividend 18 percent. Further, the retailer forecast first-quarter earnings below Street view and expects flat comparable sales in the U.S., citing slower than planned start to sales in February.

Consolidated net income attributable to Walmart increased to $5.606 billion from $5.163 billion. Earnings per share climbed to $1.67 from $1.50. The latest results benefited from a lower than expected effective tax rate.

Income per common share from continuing operations attributable to Walmart was $1.51 last year.

On average, 22 analysts polled by Thomson Reuters expected earnings of $1.57 per share for the quarter. Analysts' estimates typically exclude special items.

Total revenue rose 3.9 percent to $127.92 billion from $123.17 billion last year. Analysts expected revenues of $128.77 billion.

Net sales advanced 3.9 percent to $127.1 billion, including fuel. On a constant currency basis, net sales would have increased 3.7 percent to $126.8 billion.

Comparable store sales without fuel rose 1.2 percent, compared to a 2.1 percent growth last year.

Operating income for the quarter grew 2.4 percent to $8.60 billion.

Walmart U.S. sales advanced 2.6 percent to $74.665 billion and operating income improved 4.3 percent. Comparable store sales rose 1 percent without fuel and was below guidance, compared to a 1.5 percent growth last year, driven by an increase in average ticket of 1.1 percent and a traffic decline of 10 basis points.

Noting that February sales started slower than planned, due mainly to the delay in income tax refunds, the company forecast comparable sales for the 13-week period from January 26 to April. 26 to be around flat. The Walmart U.S. 13-week comps for last year's first quarter 13-week period rose 2.6 percent.

Walmart International sales grew 6.9 percent to $37.949 billion and operating income advanced 6.1 percent. Sam's Club sales were $14.490 billion, up 3.4 percent from last year. Operating income slid 3.5 percent.

The retailer also declared an 18 percent increase in its annual dividend at $1.88 per share.

Looking ahead to the first quarter, earnings per share are estimated in the range of $1.11 and $1.16, compared to $1.09 earned in the prior year. Analysts look for earnings of $1.18 per share.

For fiscal 2014, earnings per share are estimated to range between $5.20 and $5.40, including increased costs of around $0.09 per share for e-commerce operations. In fiscal 2013, full year earnings totaled $5.02 per share. Wall Street looks for earnings of $5.37 per share.

WMT closed at $69.21 on Wednesday.

by RTTNews Staff Writer

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