The world’s largest retailer, Wal-Mart Stores, Inc. (WMT) reported fourth quarter 2013 earnings of $1.67 per share topping the Zacks Consensus Estimate of $1.57 per share by 6.4%. Earnings were up 10.6% from the prior-year quarter earnings of $1.51 per share.
The fourth quarter fiscal 2013 results were ahead of the company’s earnings guidance range of $1.53 to $1.58 per share. The year-over-year earnings benefited from a lower-than-expected effective tax rate in the quarter. Top-line growth coupled with cost savings also boosted earnings.
Total revenue climbed 3.9% to $127.9 billion (including membership and other income), missing the Zacks Consensus Estimate of $129.2 billion. The company sales were driven by strong comparable store sales growth, which was overshadowed by foreign currency headwinds. Net sales, excluding currency impact, increased 3.7% to $126.8 billion.
Consolidated operating income increased 2.4% to $8.6 billion, driven by productivity improvements. On a constant currency basis, operating income increased 1.4% to $8.5 billion.
Segment Details
Walmart U.S.: The segment posted net sales growth of 2.6% to $74.7 billion in the quarter, including the impact of fuel sales, driven by positive comparable growth. Operating income increased 4.3% to $6.4 billion.
U.S. same-store sales increased 1.0%, driven by an increase in average ticket, offset by a decline in traffic. Same-store sales growth was at the lower end of the company’s guidance range of 1.0% to 3.0%. The growing traffic trend in its stores has helped the company post six consecutive quarters of positive same-store sales in this segment.
Walmart International: Segment net sales, including fuel sales, acquisitions and currency impact, increased 6.9% to $37.9 billion. Excluding currency headwinds, international sales increased 6.0% to $37.6 billion.
Operating income increased 6.1% to $2.4 billion. Taking into account adjustments for constant currency, operating income for the segment grew 2.6% in the quarter.
Sam’s Club: The segment, which comprises membership warehouse clubs, posted net sales growth, including fuel impact, of 3.4% to $14.5 billion. Sam’s Club operating income declined 3.5% to $0.5 billion in the quarter due to a reduction in gross profit margin from price investment strategies.
Sam’s Club's comparable sales, excluding the impact of fuel sales, increased 2.3% in the quarter, driven by increase in average ticket and positive traffic. The same store sales growth was within the guidance range of 1.5% to 3.5%.
Fiscal 2013 Results
Walmart’s fiscal year 2013 earnings were $5.02 per share, which exceeded the Zacks Consensus Estimate of $4.92 per share by 2.0%. Earnings were up 10.6% from the prior-year period, driven by lower-than-expected tax rate.