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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

Both Walmart U.S. and Sam’s Club will report comp sales for the 13-week period on Feb. 21, 2013, when the company reports fourth quarter results.

Wal-Mart Stores, Inc. (NYSE: WMT) helps people around the world save money and live better – anytime and anywhere – in retail stores, online, and through their mobile devices. Each week, more than 200 million customers and members visit our 10,500 stores under 69 banners in 27 countries and e-commerce websites in 10 countries. With fiscal year 2012 sales of approximately $444 billion, Walmart employs more than 2 million associates worldwide. Walmart continues to be a leader in sustainability, corporate philanthropy and employment opportunity. Additional information about Walmart can be found by visiting http://corporate.walmart.com, and on Facebook at http://facebook.com/walmart and on Twitter at http://twitter.com/walmart. Online merchandise sales are available at http://www.walmart.com and http://www.samsclub.com.

Notes

After this earnings release has been furnished to the Securities and Exchange Commission (SEC), a pre-recorded call offering additional comments on the quarter will be available to all investors. Please note: Walmart has a new phone number for accessing the pre-recorded call. Callers within the U.S and Canada may dial 877-523-5612 and enter passcode 9256278. All other callers can access the call by dialing 201-689-8483 and entering passcode 9256278. Information included in this release, including reconciliations, and the pre-recorded phone call are available in the investor information area on the company’s website at www.stock.walmart.com.

Editor’s Note: High resolution photos of Walmart’s U.S. business, Sam’s Club and international operations are available for download at: www.stock.walmart.com.

1 See additional information at the end of this release regarding non-GAAP measures.

Forward-looking statements

This release contains statements as to Walmart management’s forecasts of the company’s earnings per share for the fiscal quarter and fiscal year to end Jan. 31, 2013 (and certain assumptions underlying such forecasts), and management's expectations regarding the comparable store sales of the Walmart U.S. segment and comparable club sales, excluding fuel, of the Sam’s Club segment of the company for the 13-week period from Oct. 27, 2012 through Jan. 25, 2013, and management’s expectations that the Walmart U.S. operating segment will have strong performance through Thanksgiving weekend that the company believes are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. These statements are intended to enjoy the protection of the safe harbor for forward-looking statements provided by that act. Those statements can be identified by the use of the word or phrase “based on,” “consider,” “expect,” “expects,” “guidance,” “we’ll offer” and “will implement” in the statements or relating to such statements. These forward-looking statements are subject to risks, uncertainties and other factors, domestically and internationally, including: general economic conditions; economic conditions affecting specific markets in which we operate; competitive pressures; inflation and deflation; consumer confidence, disposable income, credit availability, spending patterns and debt levels; the seasonality of Walmart’s business and seasonal buying patterns in the United States and other markets; geo-political conditions and events; weather conditions and events and their effects; catastrophic events and natural disasters and their effects on Walmart’s business; public health emergencies; civil unrest and disturbances and terrorist attacks; commodity prices; the cost of goods Walmart sells; transportation costs; the cost of diesel fuel, gasoline, natural gas and electricity; the selling prices of gasoline; disruption of Walmart’s supply chain, including transport of goods from foreign suppliers; trade restrictions; changes in tariff and freight rates; labor costs; changes in employment laws and regulations; the cost of healthcare and other benefits; casualty and other insurance costs; accident-related costs; adoption of or changes in tax and other laws and regulations that affect Walmart’s business, including changes in corporate tax rates; developments in, and the outcome of, legal and regulatory proceedings to which Walmart is a party or is subject; currency exchange rate fluctuations; changes in market interest rates; conditions and events affecting domestic and global financial and capital markets; and other risks. The company discusses certain of these factors more fully in certain of its filings with the SEC, including its most recent annual report on Form 10-K filed with the SEC, and this release should be read in conjunction with that annual report on Form 10-K, together with all of the company’s other filings, including its current reports on Form 8-K, made with the SEC through the date of this release. The company urges readers to consider all of these risks, uncertainties and other factors carefully in evaluating the forward-looking statements contained in this release. As a result of these matters, changes in facts, assumptions not being realized or other circumstances, the company’s actual results may differ materially from the expected results discussed in the forward-looking statements contained in this release. We discuss our existing FCPA investigation and related matters in the filed portion of our Nov. 15, 2012 Form 8-K, as well as in our Form 10-Q filed on Sept. 6, 2012 and investors are referred to those SEC reports for information concerning those matters. The forward-looking statements made in this release are made only as of the date of this release, and Walmart undertakes no obligation to update them to reflect subsequent events or circumstances.

     
 
 
 
 
Wal-Mart Stores, Inc.
Condensed Consolidated Statements of Income
(Unaudited)
                             
SUBJECT TO RECLASSIFICATION
Three Months Ended Nine Months Ended
      October 31,         October 31,
(Amounts in millions except per share data)     2012       2011       Percent

Change

        2012       2011       Percent

Change

Revenues:
Net sales $ 113,204 $ 109,516 3.4 % $ 339,010 $ 321,569 5.4 %
Membership and other income       725           710         2.1 %           2,233           2,212         0.9 %
Total Revenue 113,929 110,226 3.4 % 341,243 323,781 5.4 %
 
 
Cost of sales 85,517 82,591 3.5 % 256,360 242,538 5.7 %
Operating, selling, general and administrative expenses       22,296           21,757         2.5 %           65,682           63,086         4.1 %
Operating income 6,116 5,878 4.0 % 19,201 18,157 5.7 %
 
Interest:
Debt 522 528 -1.1 % 1,512 1,544 -2.1 %
Capital leases 68 72 -5.6 % 206 218 -5.5 %
Interest income       (43 )         (65 )       -33.8 %           (131 )         (131 )       0.0 %
Interest, net       547           535         2.2 %           1,587           1,631         -2.7 %
 
Income from continuing operations before income taxes 5,569 5,343 4.2 % 17,614 16,526 6.6 %
 
Provision for income taxes       1,744           1,842         -5.3 %           5,734           5,510         4.1 %
Income from continuing operations 3,825 3,501 9.3 % 11,880 11,016 7.8 %
Loss from discontinued operations, net of tax       -           (8 )       -100.0 %           -           (36 )       -100.0 %
Consolidated net income 3,825 3,493 9.5 % 11,880 10,980 8.2 %
Less consolidated net income attributable to noncontrolling interest       (190 )         (157 )       21.0 %           (487 )         (444 )       9.7 %
Consolidated net income attributable to Walmart     $ 3,635         $ 3,336         9.0 %         $ 11,393         $ 10,536         8.1 %
 
Income from continuing operations attributable to Walmart:
Income from continuing operations $ 3,825 $ 3,501 9.3 % $ 11,880 $ 11,016 7.8 %
Less consolidated net income attributable to noncontrolling interest       (190 )         (157 )       21.0 %           (487 )         (444 )       9.7 %
Income from continuing operations attributable to Walmart     $ 3,635         $ 3,344         8.7 %         $ 11,393         $ 10,572         7.8 %
 
Basic net income per common share:

Basic income per common share from continuing operations attributable to Walmart

$ 1.08 $ 0.97 11.3 % $ 3.37 $ 3.04 10.9 %

Basic income per common share from discontinued operations attributable to Walmart

      -           -         -             -           (0.01 )       -100.0 %
Basic net income per common share attributable to Walmart     $ 1.08         $ 0.97         11.3 %         $ 3.37         $ 3.03         11.2 %
 
Diluted net income per common share:

Diluted income per common share from continuing operations attributable to Walmart

$ 1.08 $ 0.97 11.3 % $ 3.35 $ 3.03 10.6 %

Diluted income per common share from discontinued operations attributable to Walmart

      -           (0.01 )       -100.0 %           -           (0.01 )       -100.0 %
Diluted net income per common share attributable to Walmart     $ 1.08         $ 0.96         12.5 %         $ 3.35         $ 3.02         10.9 %
 
Weighted-average number of common shares:
Basic 3,364 3,445 3,385 3,473
Diluted 3,379 3,458 3,400 3,487
 
Dividends declared per common share $ - $ - $ 1.59 $ 1.46
 
 
 
 
 
 
Wal-Mart Stores, Inc.
Condensed Consolidated Balance Sheets
(Unaudited)
                 
SUBJECT TO RECLASSIFICATION
        October 31,       January 31,       October 31,
(Amounts in millions)       2012       2012       2011
ASSETS
Current assets:
Cash and cash equivalents $ 8,643 $ 6,550 $ 7,063
Receivables, net 5,567 5,937 4,757
Inventories 47,487 40,714 44,340
Prepaid expenses and other 1,654 1,685 3,227
Current assets of discontinued operations         80           89           89  
Total current assets 63,431 54,975 59,476
 
Property and equipment:
Property and equipment 163,011 155,002 151,638
Less accumulated depreciation         (50,450 )         (45,399 )         (43,909 )
Property and equipment, net 112,561 109,603 107,729
 
Property under capital leases:
Property under capital leases 5,900 5,936 5,860
Less accumulated amortization         (3,208 )         (3,215 )         (3,197 )
Property under capital leases, net 2,692 2,721 2,663
 
Goodwill 20,572 20,651 20,409
Other assets and deferred charges         6,562           5,456           4,967  
Total assets       $ 205,818         $ 193,406         $ 195,244  
 
LIABILITIES AND EQUITY
Current liabilities:
Short-term borrowings $ 8,740 $ 4,047 $ 9,594
Accounts payable 40,272 36,608 37,555
Dividends payable 1,381 - 1,305
Accrued liabilities 18,536 18,154 16,890
Accrued income taxes 1,010 1,164 382
Long-term debt due within one year 6,550 1,975 1,470
Obligations under capital leases due within one year 331 326 321
Current liabilities of discontinued operations         25           26           27  
Total current liabilities 76,845 62,300 67,544
 
Long-term debt 38,872 44,070 44,872
Long-term obligations under capital leases 2,964 3,009 2,979
Deferred income taxes and other 8,044 7,862 8,085
Redeemable noncontrolling interest 492 404 373
 
Commitments and contingencies
 
Equity:
Common stock 336 342 344
Capital in excess of par value 3,861 3,692 3,425
Retained earnings 70,256 68,691 64,769
Accumulated other comprehensive income (loss)         (562 )         (1,410 )         (1,375 )
Total Walmart shareholders’ equity 73,891 71,315 67,163
Noncontrolling interest         4,710           4,446           4,228  
Total equity         78,601           75,761           71,391  
Total liabilities and equity       $ 205,818         $ 193,406         $ 195,244  
 
 
 
 
 
 
Wal-Mart Stores, Inc.
Condensed Consolidated Statements of Cash Flows
(Unaudited)
         
SUBJECT TO RECLASSIFICATION
Nine Months Ended
        October 31,
(Amounts in millions)       2012     2011
Cash flows from operating activities:
Consolidated net income $ 11,880 $ 10,980
Loss from discontinued operations, net of tax         -         36  
Income from continuing operations 11,880 11,016
Adjustments to reconcile income from continuing operations to net cash provided by operating activities:
Depreciation and amortization 6,322 6,067
Deferred income taxes 279 1,342
Other 81 25
Changes in certain assets and liabilities, net of effects of acquisitions:
Accounts receivable 501 499
Inventories (6,459 ) (7,357 )
Accounts payable 3,545 3,417
Accrued liabilities (82 ) (2,305 )
Accrued taxes         (160 )       210  
Net cash provided by operating activities 15,907 12,914
 
Cash flows from investing activities:
Payments for property and equipment (8,921 ) (9,543 )
Proceeds from disposal of property and equipment 343 354
Investments and business acquisitions, net of cash acquired (716 ) (3,537 )
Other investing activities         (58 )       (88 )
Net cash used in investing activities (9,352 ) (12,814 )
 
Cash flows from financing activities:
Net change in short-term borrowings 4,700 8,558
Proceeds from issuance of long-term debt 199 5,008
Payment of long-term debt (639 ) (4,265 )
Dividends paid (4,034 ) (3,800 )
Purchase of Company stock (4,657 ) (4,957 )
Other financing activities         (263 )       (828 )
Net cash used in financing activities (4,694 ) (284 )
 
Effect of exchange rates on cash and cash equivalents         232         (148 )
Net increase (decrease) in cash and cash equivalents 2,093 (332 )
Cash and cash equivalents at beginning of year         6,550         7,395  
Cash and cash equivalents at end of period       $ 8,643       $ 7,063  
 
 
 
 
 

Reconciliations of and Other Information Regarding Non-GAAP Financial Measures

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