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Walmart Reports Q3 EPS Of $1.08, Reaffirms Top End Of Full-year EPS Guidance; Company Is Well Positioned For Q4 Holidays

Stocks in this article: WMT

“We consider the competitive retail environment and economic factors, among others, when we provide guidance. Based on these considerations, we expect fourth quarter fiscal 2013 diluted earnings per share from continuing operations to range between $1.53 and $1.58. This compares to last year’s fourth quarter reported EPS of $1.51, which benefitted $0.07 from certain items,” said Holley. “Net of those items, earnings per share for last year’s fourth quarter would have been $1.44.

“For the full year, we are tightening and reaffirming the top end of our earnings per share guidance to a range of $4.88 to $4.93. This compares to our previous guidance of $4.83 to $4.93,” Holley said. “Last year’s full-year EPS was $4.54.”

Operating segment details and analysis

Net sales

Net sales, including fuel, were as follows (dollars in billions):

    Three Months Ended         Nine Months Ended
October 31, October 31,
        Percent         Percent
2012     2011     Change 2012     2011     Change
Net Sales:
Walmart U.S. $ 66.127 $ 63.835 3.6 % $ 199.825 $ 191.397 4.4 %
Walmart International 33.159 32.383 2.4 % 97.252 90.387 7.6 %
Sam's Club   13.918       13.298     4.7 %   41.933       39.785     5.4 %
Total Company $ 113.204 $ 109.516 3.4 % $ 339.010 $ 321.569 5.4 %

 

The following explanations provide additional context to the above table for the third quarter.

  • Constant currency consolidated net sales would have increased by 4.9 percent to $114.9 billion during the third quarter.
  • Walmart International net sales, on a constant currency basis, would have increased 7.6 percent to $34.8 billion.
  • Sam’s Club net sales, excluding fuel, were $12.2 billion, an increase of 3.6 percent from last year’s third quarter results.

Segment operating income

Segment operating income was as follows (dollars in billions):

      Three Months Ended         Nine Months Ended
October 31, October 31,
2012     2011    

Percent

Change

2012     2011    

Percent

Change

Segment Operating Income:                
Walmart U.S. $ 4.844 $ 4.634 4.5 % $ 15.128 $ 14.280 5.9 %
Walmart International 1.455 1.389 4.8 % 4.258 3.885 9.6 %
Sam's Club 0.435 0.386 12.7 % 1.461 1.328 10.0 %
 

The following explanations provide additional context to the above table for the third quarter.

  • Consolidated operating income, which includes other unallocated, was $6.1 billion, up 4.0 percent from last year. On a constant currency basis, consolidated operating income would have increased 4.5 percent.
  • All three segments grew operating income faster than sales, a company priority.
  • On a constant currency basis, Walmart International’s operating income would have increased 6.8 percent. Currency exchange rate fluctuations negatively impacted operating income by approximately $29 million.
  • Sam’s Club operating income, excluding fuel, increased 14.2 percent.

“We were pleased that our constant currency sales and operating income were both up approximately 7 percent for the third quarter,” said Doug McMillon, president and CEO of Walmart International. “We gained market share in almost all of our markets, indicating that our underlying business is performing well. We are working hard to improve execution where it’s needed, and we’re ready with great merchandise and price investments for the fourth quarter.”

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