NEW YORK (TheStreet) -- Walmart Stores Inc.'s (WMT - Get Report) Massmart Holdings, the South African food and goods wholesaler it owns, said the country's retailers may face headwinds into next year as higher interest rates and prices sap consumer confidence, Bloomberg reports.
Earnings excluding one-time items declined 26% to 364 million rand ($34.3 million) in the 26 weeks through June 29, the Johannesburg-based company said. At constant exchange rates, profit fell 5.7%.
South African retailers are struggling as high unemployment and inflation force shoppers to cut down on major purchases. Retail sales were unchanged in June, the worst performance since December 2009, Bloomberg said.
- WMT's revenue growth has slightly outpaced the industry average of 4.7%. Since the same quarter one year prior, revenues slightly increased by 2.8%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Food & Staples Retailing industry average. The net income increased by 0.6% when compared to the same quarter one year prior, going from $4,069.00 million to $4,093.00 million.
- WAL-MART STORES INC' earnings per share from the most recent quarter came in slightly below the year earlier quarter. The company has suffered a declining pattern of earnings per share over the past year. However, we anticipate this trend reversing over the coming year. During the past fiscal year, WAL-MART STORES INC reported lower earnings of $4.86 versus $5.01 in the prior year. This year, the market expects an improvement in earnings ($5.03 versus $4.86).
- The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Food & Staples Retailing industry and the overall market, WAL-MART STORES INC's return on equity exceeds that of both the industry average and the S&P 500.
- You can view the full analysis from the report here: WMT Ratings Report