Wal-Mart Reports Record Fourth Quarter Sales and Earnings

BENTONVILLE, Ark., Feb. 19 -- Wal-Mart Stores, Inc. (NYSE: WMT) today reported its sales and earnings for the quarter ended Jan. 31, 2008. Net sales for the fourth quarter of fiscal year 2008 were $106.269 billion, an increase of 8.3 percent over the fourth quarter of fiscal year 2007. Income from continuing operations for the quarter was $4.096 billion, an increase of 4.0 percent from $3.940 billion in the fourth quarter of fiscal year 2007.

Diluted earnings per share from continuing operations for the fourth quarter of fiscal year 2008 were $1.02, up 7.4 percent from $0.95 per share in the same prior year quarter, including a net charge of approximately $0.02 per share for certain items this year.

These items included charges of $0.03 for approximately $70 million in after-tax expenses for dropped U.S. real estate projects and an after-tax restructuring charge of $32 million in the Company's Japan operations, and a $0.01 benefit from the recognition of approximately $38 million in after-tax gains from the sale of certain real estate properties.

Net sales for the fiscal year ended Jan. 31, 2008 were $374.526 billion, an increase of 8.6 percent over fiscal year 2007. Income from continuing operations for the fiscal year ended Jan. 31, 2008 increased 5.8 percent to $12.884 billion, up from $12.178 billion in the prior year. Diluted earnings per share from continuing operations for the fiscal year ended Jan. 31, 2008 were $3.16, up 8.2 percent from $2.92 in the prior year.

"For the fourth quarter, we topped $100 billion in sales, the first time in history that any retailer has reached this milestone in a single quarter," said Lee Scott, Wal-Mart Stores, Inc. president and chief executive officer. "We had a very strong underlying operating performance, exceeding our expectations for the quarter. In addition to another year of record sales and earnings, we also delivered a record return to our shareholders this year through more than $11 billion in share repurchase and dividends."

Scott attributed the strong results to the Company's price leadership and improved customer service, especially at the Wal-Mart Stores U.S. division.

"The price leadership strategy we put in place at the beginning of the year was exactly the right strategy for our customers around the world in a tough economic environment," Scott said. "The combination of price leadership and improved customer service made the difference in the fourth quarter for our U.S. operations, and I also want to thank our Sam's Clubs and International associates for their record performances this year.

"We know that the economy remains a critical factor in this new fiscal year," Scott added. "Customers were more cautious in their spending in January. In a volatile economy, I believe we are well positioned to succeed. We will continue to strengthen our price leadership around the world."



    Net Sales
    Net sales were as follows (dollars in billions):

                             Three Months Ended          Twelve Months Ended
                                  January 31,                January 31,
                                             Percent                   Percent
                             2008     2007   Change    2008      2007   Change
    Net Sales:
      Wal-Mart Stores      $67.428  $64.228   5.0%  $239.529  $226.294   5.8%
      Sam's Club            11.831   11.128   6.3%    44.357    41.582   6.7%
      International         27.010   22.734  18.8%    90.640    77.116  17.5%
        Total Company     $106.269  $98.090   8.3%  $374.526  $344.992   8.6%



    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          Twelve Months Ended
                                  January 31,                January 31,
                                             Percent                   Percent
                             2008     2007   Change    2008      2007   Change
    Operating Income:
      Wal-Mart Stores       $5.302   $5.035   5.3%   $17.516   $16.620   5.4%
      Sam's Club             0.446    0.435   2.5%     1.618     1.480   9.3%
      International          1.743    1.522  14.5%     4.769     4.265  11.8%


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. As a result of the change, certain direct segment costs that were previously retained and managed as corporate overhead costs are 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 12-month periods ended Jan. 31, 2008 and 2007. Comparable store sales for the United States were as follows:

                         Without Fuel         With Fuel         Fuel Impact
                      Three Months Ended Three Months Ended Three Months Ended
                          January 31,        January 31,        January 31,
                         2008    2007       2008    2007       2008     2007

    Wal-Mart Stores      1.6%    1.3%       1.6%    1.3%       0.0%     0.0%
    Sam's Club           2.5%    3.1%       5.0%    1.9%       2.5%    -1.2%
        Total U.S.       1.7%    1.6%       2.1%    1.4%       0.4%    -0.2%



                         Without Fuel         With Fuel         Fuel Impact
                   Twelve Months Ended Twelve Months Ended Twelve Months Ended
                          January 31,        January 31,        January 31,
                         2008    2007       2008    2007       2008     2007

    Wal-Mart Stores      1.0%    1.9%       1.0%    1.9%       0.0%     0.0%
    Sam's Club           4.2%    2.9%       4.9%    2.5%       0.7%    -0.4%
        Total U.S.       1.4%    2.1%       1.6%    2.0%       0.2%    -0.1%



    Guidance

The Company expects diluted earnings per share from continuing operations to be between $0.70 and $0.74 for the first quarter of fiscal year 2009, and between $3.30 and $3.43 for the full fiscal year 2009.

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 are 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 (NYSE) 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 our management's expectations regarding the Company's price leadership position around the world and the Company's expectations for its diluted earnings per share from continuing operations for the first quarter of fiscal year 2009 and for all of fiscal year 2009 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 "will continue" and "expects" 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, general economic conditions, consumer credit availability, 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
                                           Quarter Ended   Twelve Months Ended
                                             January 31,       January 31,
                                           2008     2007      2008      2007
    Revenues:
        Net sales                       $106,269  $98,090  $374,526  $344,992
        Membership and other income        1,159      988     4,273     3,658
                                         107,428   99,078   378,799   348,650
    Costs and expenses:
        Cost of sales                     81,323   75,565   286,515   264,152
        Operating, selling, general and
         administrative expenses          19,224   17,080    70,288    64,001
    Operating income                       6,881    6,433    21,996    20,497

    Interest:
        Debt                                 537      361     1,863     1,549
        Capital leases                        66       69       240       260
        Interest income                      (62)     (85)     (305)     (280)
        Interest, net                        541      345     1,798     1,529

    Income from continuing operations
     before income taxes and minority
     interest                              6,340    6,088    20,198    18,968

    Provision for income taxes             2,143    1,977     6,908     6,365
    Income from continuing operations
     before minority interest              4,197    4,111    13,290    12,603
    Minority interest                       (101)    (171)     (406)     (425)
    Income from continuing operations      4,096    3,940    12,884    12,178
    Loss from discontinued operations,
     net of tax                              -        -        (153)     (894)
    Net income                            $4,096   $3,940   $12,731   $11,284

    Net income per common share:
        Basic income per common share from
         continuing operations             $1.03    $0.95     $3.17     $2.92
        Basic loss per common share from
         discontinued operations             -        -       (0.04)    (0.21)
        Basic net income per common share  $1.03    $0.95     $3.13     $2.71

        Diluted income per common share
         from continuing operations        $1.02    $0.95     $3.16     $2.92
        Diluted loss per common share from
         discontinued operations             -        -       (0.03)    (0.21)
        Diluted net income per common
         share                             $1.02    $0.95     $3.13     $2.71

    Weighted-average number of common
     shares:
        Basic                              3,992    4,153     4,066     4,164
        Diluted                            3,998    4,156     4,072     4,168

    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
                                                     January 31,   January 31,
                                                         2008          2007
                                 ASSETS
    Current assets:
    Cash and cash equivalents                           $5,569        $7,767
    Receivables                                          3,654         2,840
    Inventories                                         35,180        33,685
    Prepaid expenses and other                           3,002         2,690
        Total current assets                            47,405        46,982

    Property and equipment, at cost                    122,648       109,798
    Less accumulated depreciation                      (28,773)      (24,408)
        Property and equipment, net                     93,875        85,390

    Property under capital leases                        5,736         5,392
    Less accumulated amortization                       (2,594)       (2,342)
        Property under capital leases, net               3,142         3,050

    Goodwill                                            16,092        13,759
    Other assets and deferred charges                    2,864         2,406
        Total assets                                  $163,378      $151,587

      LIABILITIES AND SHAREHOLDERS' EQUITY
    Current liabilities:
    Commercial paper                                    $5,040        $2,570
    Accounts payable                                    30,370        28,484
    Accrued liabilities                                 15,798        14,675
    Accrued income taxes                                   716           706
    Long-term debt due within one year                   5,913         5,428
    Obligations under capital leases due within one year   316           285
        Total current liabilities                       58,153        52,148

    Long-term debt                                      29,799        27,222
    Long-term obligations under capital leases           3,603         3,513
    Deferred income taxes and other                      5,276         4,971
    Minority interest                                    1,939         2,160

    Commitments and contingencies

    Shareholders' equity:
    Common stock and capital in excess of par value      3,425         3,247
    Retained earnings                                   57,319        55,818
    Accumulated other comprehensive income               3,864         2,508
        Total shareholders' equity                      64,608        61,573
        Total liabilities and shareholders' equity    $163,378      $151,587

Certain prior year amounts were reclassified to conform to the current year presentation.



                     WAL-MART STORES, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)
                              (Amounts in millions)

    SUBJECT TO RECLASSIFICATION                           Twelve Months Ended
                                                               January 31,
                                                            2008        2007
    Cash flows from operating activities:
      Net income                                          $12,731     $11,284
      Loss from discontinued operations, net of tax           153         894
      Income from continuing operations                    12,884      12,178
      Adjustments to reconcile income from continuing
       operations to net cash provided by operating
       activities:
        Depreciation and amortization                       6,317       5,459
        Other                                                 915       1,128
        Changes in certain assets and liabilities,
         net of effects of acquisitions:
            Increase in accounts receivable                  (564)       (214)
            Increase in inventories                          (775)     (1,274)
            Increase in accounts payable                      865       2,132
            Increase in accrued liabilities                   712         588
    Net cash provided by operating activities of
     continuing operations                                 20,354      19,997
    Net cash used in operating activities of discontinued
     operations                                               -           (45)
    Net cash provided by operating activities              20,354      19,952

    Cash flows from investing activities:
      Payments for property and equipment                 (14,937)    (15,666)
      Proceeds from disposal of property and equipment        957         394
      (Payments for) proceeds from disposal of certain
       international operations, net                         (257)        610
      Investment in international operations,
       net of cash acquired                                (1,338)        (68)
      Other investing activities                              (95)        223
    Net cash used in investing activities of continuing
     operations                                           (15,670)    (14,507)
    Net cash provided by investing activities of
     discontinued operations                                  -            44
    Net cash used in investing activities                 (15,670)    (14,463)
    Cash flows from financing activities:
      Increase (decrease) in commercial paper               2,376      (1,193)
      Proceeds from issuance of long-term debt             11,167       7,199
      Payment of long-term debt                            (8,723)     (5,758)
      Dividends paid                                       (3,586)     (2,802)
      Purchase of Company stock                            (7,691)     (1,718)
      Other financing activities                             (677)       (567)
    Net cash used in financing activities                  (7,134)     (4,839)
    Effect of exchange rates on cash                          252          97
    Net (decrease) increase in cash and cash equivalents   (2,198)        747
    Cash and cash equivalents at beginning of year (1)      7,767       7,020
    Cash and cash equivalents at end of period             $5,569      $7,767

    (1) Includes cash and cash equivalents of discontinued operations of
        $221 million at January 31, 2006.

Certain prior year amounts were reclassified to conform to the current year presentation.

SOURCE  Wal-Mart Stores, Inc.
    -0-                             02/19/2008
    /CONTACT:  Investor Relations, +1-479-273-8446, or Carol Schumacher,
+1-479-277-1498, or Media Relations, John Simley, 1-800-331-0085, or
Pre-recorded Conference Call, +1-203-369-1090, all of Wal-Mart Stores, Inc./
    /Photo:  http://www.newscom.com/cgi-bin/prnh/20070927/WALMARTCOMLOGO
              AP Archive:  http://photoarchive.ap.org
              PRN Photo Desk, photodesk@prnewswire.com/
    /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

SH-JR
-- LATU055 --
7186 02/19/2008 06:20 EST http://www.prnewswire.com