BENTONVILLE, Ark., Nov. 13 -- Wal-Mart Stores, Inc. (NYSE: WMT) today reported its sales and earnings for the quarter ended Oct. 31, 2007. Net sales for the third quarter of fiscal year 2008 were approximately $90.9 billion, an increase of 8.8 percent over the third quarter of fiscal year 2007. Income from continuing operations for the quarter was $2.86 billion.
Earnings per share from continuing operations were $0.70, up from $0.62 per share in the same prior year quarter. Earnings per share from continuing operations for the third quarter were impacted positively $0.01 per share due to the recognition of $46.5 million in after tax gains from the sale of certain real estate properties.
Net Sales
Net sales were as follows (dollars in billions):
Three Months Ended Nine Months Ended
October 31, October 31,
Percent Percent
2007 2006 Change 2007 2006 Change
Net Sales:
Wal-Mart Stores $57.651 $54.179 6.4% $172.101 $162.067 6.2%
Sam's Club 10.826 10.206 6.1% 32.526 30.453 6.8%
International 22.403 19.158 16.9% 63.630 54.382 17.0%
Total Company $90.880 $83.543 8.8% $268.257 $246.902 8.6%
"Our results for the third quarter reflect the improved performance of our U.S. operations. Both Wal-Mart Stores U.S. and Sam's Club increased profits faster than sales. Wal-Mart International posted a solid quarter as well," said Lee Scott, Wal-Mart Stores, Inc. president and chief executive officer. "Our focus on managing inventory this quarter was very positive.
"During the Christmas and holiday season, our price leadership position will benefit both our customers and the Company," Scott added. "We have set the stage for a successful fourth quarter."
Segment Operating Income
Segment operating income from continuing operations for each of the Company's operating segments, which is defined as income before net interest expense, income taxes, unallocated corporate overhead, minority interest and discontinued operations, was as follows (dollars in billions):
Three Months Ended Nine Months Ended
October 31, October 31,
Percent Percent
2007 2006 Change 2007 2006 Change
Operating Income:
Wal-Mart Stores $4.013 $3.611 11.1% $12.214 $11.585 5.4%
Sam's Club 0.362 0.341 6.2% 1.172 1.045 12.2%
International 1.081 0.995 8.6% 3.026 2.743 10.3%
As the Company discussed in the first quarter of fiscal year 2008, the above measurement of segment operating income was changed starting in the first quarter to be consistent with certain changes to internal management reporting. Therefore, certain direct segment costs that were previously retained and managed as corporate overhead costs are now allocated to the appropriate operating segment.
Comparable Store Sales
The Company reports comparable store sales in this earnings release based
on the calendar months in the quarters and the nine-month periods ended
Oct. 31, 2007 and 2006. Comparable store sales for the United States were as
follows:
Without Fuel With Fuel Fuel Impact
Three Months Three Months Three Months
Ended Ended Ended
October 31, October 31, October 31,
2007 2006 2007 2006 2007 2006
Wal-Mart Stores 1.0% 1.5% 1.0% 1.5% 0.0% 0.0%
Sam's Club 3.9% 1.8% 3.8% 0.0% -0.1% -1.8%
Total U.S. 1.5% 1.5% 1.5% 1.2% 0.0% -0.3%
Without Fuel With Fuel Fuel Impact
Nine Months Nine Months Nine Months
Ended Ended Ended
October 31, October 31, October 31,
2007 2006 2007 2006 2007 2006
Wal-Mart Stores 0.7% 2.2% 0.7% 2.2% 0.0% 0.0%
Sam's Club 4.8% 2.8% 4.8% 2.8% 0.0% 0.0%
Total U.S. 1.4% 2.3% 1.4% 2.3% 0.0% 0.0%
Guidance
For the fourth quarter of fiscal year 2008, the Company estimates the comparable store sales increase in the United States to be between flat and 2 percent, according to Tom Schoewe, Wal-Mart Stores, Inc. executive vice president and chief financial officer.
"We expect earnings per share from continuing operations for the fourth quarter to be between $0.99 and $1.03, resulting in the full year Company forecast for earnings per share from continuing operations of $3.13 to $3.17," said Schoewe. "This guidance includes an anticipated restructuring charge for Seiyu of approximately $40 million after tax in the fourth quarter."
After this earnings release has been furnished to the SEC, a pre-recorded call offering additional comments on the quarter will be available to all investors. Callers may listen to this call by dialing 203-369-1090. The information included in this release and the pre-recorded phone call will be available in the investor information area on the Company's Web site at http://www.walmartstores.com/investors.
Wal-Mart Stores, Inc. operates Wal-Mart discount stores, supercenters, Neighborhood Markets and Sam's Club locations in the United States. The Company operates in Argentina, Brazil, Canada, China, Costa Rica, El Salvador, Guatemala, Honduras, Japan, Mexico, Nicaragua, Puerto Rico and the United Kingdom. The Company's common stock is listed on the New York Stock Exchange under the symbol WMT.
More information about Wal-Mart can be found by visiting http://www.walmartstores.com. Online merchandise sales are available at http://www.walmart.com and http://www.samsclub.com.
This release contains statements as to the Company's estimate of its comparable store sales for the fourth quarter of fiscal year 2008 and its estimate of its earnings per share from continuing operations for the fourth quarter of fiscal year 2008 and for all of fiscal year 2008 that Wal-Mart believes are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are intended to enjoy the protection of the safe harbor for forward-looking statements provided by that Act. These statements can be identified by the use of the word "estimates," "expect" "forecast" and "anticipated" in the statements. These forward-looking statements are subject to risks, uncertainties and other factors, domestically and internationally, including, the cost of goods, competitive pressures, geopolitical conditions, inflation, consumer spending patterns and debt levels, currency exchange fluctuations, trade restrictions, changes in tariff and freight rates, changes in the costs of gasoline, diesel fuel, other energy, transportation, utilities, labor and health care, accident costs, casualty and other insurance costs, interest rate fluctuations, capital market conditions, weather conditions, storm-related damage to the Company's facilities, regulatory matters and other risks. The Company discusses certain of these factors more fully in its additional filings with the SEC, including its last 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 current reports on Form 8-K, made with the SEC through the date of this release. The Company urges you 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. The forward-looking statements made in this release are made only as of the date of this release, and the Company undertakes no obligation to update them to reflect subsequent events or circumstances.
WAL-MART STORES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(Amounts in millions except per share data)
SUBJECT TO RECLASSIFICATION Three Months Ended Nine Months Ended
October 31, October 31,
2007 2006 2007 2006
Revenues:
Net sales $90,880 $83,543 $268,257 $246,902
Membership and other income 1,069 924 3,114 2,670
91,949 84,467 271,371 249,572
Costs and expenses:
Cost of sales 69,292 63,765 205,192 188,587
Operating, selling, general and
administrative expenses 17,685 16,237 51,064 46,920
Operating income 4,972 4,465 15,115 14,065
Interest:
Debt 474 434 1,326 1,188
Capital leases 63 55 174 192
Interest income (78) (65) (243) (196)
Interest, net 459 424 1,257 1,184
Income from continuing operations
before income taxes and minority
interest 4,513 4,041 13,858 12,881
Provision for income taxes 1,557 1,363 4,765 4,388
Income from continuing operations
before minority interest 2,956 2,678 9,093 8,493
Minority interest (99) (84) (305) (254)
Income from continuing operations 2,857 2,594 8,788 8,239
Income (loss) from discontinued
operations, net of tax - 53 (153) (894)
Net income $2,857 $2,647 $8,635 $7,345
Net income per common share:
Basic income per common share from
continuing operations $0.71 $0.62 $2.15 $1.98
Basic income (loss) per common share
from discontinued operations - 0.01 (0.04) (0.22)
Basic net income per common share $0.71 $0.63 $2.11 $1.76
Diluted income per common share from
continuing operations $0.70 $0.62 $2.14 $1.97
Diluted income (loss) per common
share from discontinued operations - 0.01 (0.03) (0.21)
Diluted net income per common share $0.70 $0.63 $2.11 $1.76
Weighted-average number of common
shares:
Basic 4,051 4,169 4,092 4,168
Diluted 4,056 4,173 4,097 4,172
Dividends declared per common share $- $- $0.88 $0.67
WAL-MART STORES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(Amounts in millions)
SUBJECT TO RECLASSIFICATION October 31, October 31, January 31,
2007 2006 2007
ASSETS
Current assets:
Cash and cash equivalents $4,950 $5,908 $7,373
Receivables 3,070 2,477 2,840
Inventories 39,555 38,531 33,685
Prepaid expenses and other 3,337 2,707 2,690
Total current assets 50,912 49,623 46,588
Property and equipment, at cost 120,775 107,073 109,798
Less accumulated depreciation (27,771) (24,159) (24,408)
Property and equipment, net 93,004 82,914 85,390
Property under capital leases 5,690 5,421 5,392
Less accumulated amortization (2,563) (2,313) (2,342)
Property under capital leases, net 3,127 3,108 3,050
Goodwill 14,898 13,257 13,759
Other assets and deferred charges 3,123 2,217 2,406
Total assets $165,064 $151,119 $151,193
LIABILITIES AND SHAREHOLDERS'
EQUITY
Current liabilities:
Commercial paper $9,126 $7,968 $2,570
Accounts payable 30,800 29,263 28,090
Dividends payable 896 607 -
Accrued liabilities 14,806 14,283 14,675
Accrued income taxes - 252 706
Long-term debt due within one year 4,412 5,490 5,428
Obligations under capital leases due
within one year 309 300 285
Total current liabilities 60,349 58,163 51,754
Long-term debt 30,070 24,154 27,222
Long-term obligations under capital
leases 3,520 3,622 3,513
Deferred income taxes and other 5,614 4,785 4,971
Minority interest 2,432 1,632 2,160
Commitments and contingencies
Shareholders' equity:
Common stock and capital in excess of
par value 3,421 3,237 3,247
Retained earnings 55,519 53,738 55,818
Accumulated other comprehensive
income 4,139 1,788 2,508
Total shareholders' equity 63,079 58,763 61,573
Total liabilities and shareholders'
equity $165,064 $151,119 $151,193
WAL-MART STORES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(Amounts in millions)
Nine Months Ended
SUBJECT TO RECLASSIFICATION October 31,
2007 2006
Cash flows from operating activities:
Net income $8,635 $7,345
Loss from discontinued operations,
net of tax 153 894
Income from continuing operations 8,788 8,239
Adjustments to reconcile income from
continuing operations to net cash
provided by operating activities:
Depreciation and amortization 4,656 4,013
Other 285 427
Changes in certain assets and
liabilities, net of effects of
acquisitions:
Decrease in accounts receivable 31 103
Increase in inventories (5,037) (6,198)
Increase in accounts payable 1,450 3,501
(Decrease) increase in accrued
liabilities (1,010) 25
Net cash provided by operating
activities of continuing operations 9,163 10,110
Net cash used in operating activities
of discontinued operations - (45)
Net cash provided by operating
activities 9,163 10,065
Cash flows from investing activities:
Payments for property and equipment (10,896) (11,417)
Proceeds from disposal of property
and equipment 478 262
Proceeds from disposal of certain
international operations, net - 610
Investment in international
operations, net of cash acquired (461) (68)
Other investing activities (87) (142)
Net cash used in investing activities
of continuing operations (10,966) (10,755)
Net cash provided by investing
activities of discontinued operations - 44
Net cash used in investing activities (10,966) (10,711)
Cash flows from financing activities:
Increase in commercial paper 6,481 4,200
Proceeds from issuance of long-term
debt 7,967 3,282
Payment of long-term debt (6,671) (4,847)
Dividends paid (2,707) (2,118)
Purchase of Company stock (5,279) -
Other financing activities (669) (424)
Net cash (used in) provided by
financing activities (878) 93
Effect of exchange rates on cash 258 47
Net decrease in cash and cash
equivalents (2,423) (506)
Cash and cash equivalents at
beginning of year (1) 7,373 6,414
Cash and cash equivalents at end of
period $4,950 $5,908
(1) Includes cash and cash equivalents of discontinued operations of
$221 million at January 31, 2006.
SOURCE Wal-Mart Stores, Inc.
-0- 11/13/2007
/CONTACT: Investors, Investor Relations, +1-479-273-8446, or Carol
Schumacher, +1-479-277-1498, or Anthony Clark, +1-479-277-9558, or Media, John
Simley, 1-800-331-0085, or Pre-recorded Conference Call, +1-203-369-1090, all
of Wal-Mart Stores, Inc./
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/Web site: http://www.walmartstores.com
http://www.walmart.com
http://www.samsclub.com /
(WMT)
CO: Wal-Mart Stores, Inc.
ST: Arkansas
IN: REA SUP
SU: ERN ERP CCA
GS-AA
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9380 11/13/2007 06:32 EST http://www.prnewswire.com
