- 16Nov
(Reuters) - Wal-Mart Stores Inc (WMT.N) posted a higher quarterly profit and raised its full-year earningsforecast, but U.S. same-store sales declined as its shoppers remain under pressure in a weak economy.
The world's largest retailer has relied on cost cuts and international growth to buoy its profits. Sales at U.S. Wal-Mart stores open at least a year fell 1.3 percent, the sixth consecutive quarterly decline.
Chief Executive Officer Mike Duke said he expected that U.S. performance to improve during the fiscal fourth quarter, which includes the holiday shopping season.
"Walmart U.S. will be the price leader this holiday season, and I am confident about improving comp trends for the fourth quarter," Duke said in a statement. The company forecast U.S. same-store sales to range between a 1 percent drop to a 2 percent increase in that quarter.
"Like back-to-school and Halloween, we expect that a lot of spending will come close to Christmas," Wal-Mart U.S. CEO Bill Simon said in a recorded message.
Shares of the company rose 1 percent to $54.50 in premarket trading.
Sales at Wal-Mart's U.S. discount stores have suffered from the company's missteps in terms of merchandise selection and promotion. In addition, high unemployment has forced Wal-Mart's lower-income customers to cut back on even some essential items or to search out lower prices at dollar stores.
Wal-Mart said profit in the third quarter ended October 31 was $3.44 billion, or 95 cents a share, compared with $3.15 billion, or 82 cents a share, a year earlier.
Net sales rose 2.6 percent to $101.2 billion.
Earnings per share, excluding a tax benefit, were in line with analysts' average forecast of 90 cents, according to Thomson Reuters I/B/E/S.
Wal-Mart said it now expects fiscal 2011 earnings per share of $4.08 to $4.12, up from a previous forecast of $3.95 to $4.05, reflecting the tax benefit and expectations of a solid operational performance in its fourth quarter. Analysts were expecting a profit of $4.02 per share.
Sales at the company's international unit rose 9.3 percent to $26.92 billion. Sales at the Sam's Club warehouse club chain rose 2.7 percent to $12.14 billion.
Sam's Club and the international business have outperformed the main U.S. discount unit in recent quarters.
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