Wal-Mart sales bump comes on strength of national brand sales - The Packer

Wal-Mart sales bump comes on strength of national brand sales

02/21/2012 04:31:00 PM
Tom Karst

Wal-Mart has regained its footing by turning back the clock.

The Bentonville, Ark.-based retailer reported a 5.8% increase in net sales in the fourth quarter 2012 and a similar gain for the entire fiscal year ending Jan. 31.

Dick Spezzano, president of Monrovia, Calif.-based Spezzano Consulting Inc., said Wal-Mart has re-established itself as an “everyday low price” leader of national brands after dabbling with a private-label approach.

“Wal-Mart is known for national brands at the lowest possible price,” Spezzano said. “It wasn’t known for the lowest price on private labels,” he said.

Net sales for 2012 were $443.9 billion, up 5.9% over fiscal year 2011, according to a Feb. 21 news release from Wal-Mart. The chain reported comparable store sales were up 1.5% in the 13-week period ending Jan. 27, compared with a 1.8% decline for the same period last year.

Along with an improving economy, Spezzano said food inflation may have helped the chain boost sales.

“We are pleased with Wal-Mart’s earnings performance for both the fourth quarter and the full year,” Mike Duke, Wal-Mart Stores Inc. president and chief executive officer, said in the release. “Today, every segment of our business is stronger than it was a year ago, and we’re in a great position for fiscal year 2013.”

Duke said Wal-Mart has enjoyed two consecutive quarters of positive comparable stores sales. “Our price leadership is making a difference across the United States, as many families are settling into a new normal,” Duke said in the release.

Charles Holley, executive vice president and chief financial officer, said in the release that first quarter 2013 earnings per share could range from $1.01 to $1.06, up from 98 cents per share in the same quarter last year.

For the entire year, Wal-Mart’s earnings per share for fiscal year 2013 is projected between $4.72 and $4.92, which is up from the $4.54 per share reported for the fiscal year 2012.

After food prices rose about 4% last year, escalating gas prices could contribute to food inflation again in 2012, Spezzano said.

“More than likely, we are going to see food inflation in that 2% to 4% range,” Spezzano said.



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