Wal-Mart Stores Inc.'s (WMT) fiscal first-quarter profit rose 3%
as international sales strength continued to drive the top
line.
The world's largest retailer has grown earnings on the strength
of its international business of late, while struggling with
same-store sales weakness in the U.S. Chief Executive Mike Duke
last month indicated U.S. store momentum is a "critical priority."
It has been re-focusing on low prices and growing its merchandise
after curtailing in some categories, as American consumers face
inflation, high unemployment and a weak housing market.
Meanwhile, Wal-Mart on Monday threatened to walk away from a
proposed $2.4 billion acquisition of South African retailer
Massmart if conditions are imposed following recommendations by the
country's Competition Commission. The deal is important for
Wal-Mart as it seeks a foothold to tap into Africa's growing
consumer class.
For the quarter ended April 30, Wal-Mart posted a profit of $3.4
billion, or 97 cents a share, up from $3.3 billion, or 87 cents a
share, a year earlier. Discontinued operations cut the latest
result by a penny. In February, the company had forecast a profit
of 91 cents to 96 cents a share.
Revenue rose 4.4% to $104.19 billion, beating the $102.93
billion Wall Street estimate, according to a Thomson Reuters
poll.
International sales jumped 12%, and were up 6.2% in constant
currencies, as operating earnings increased 1.2%. U.S. sales edged
up 0.6%. On a same-store basis, excluding fuel, U.S. sales declined
1.1% at namesake stores but rose 4.2% at Sam's Club.
For the current quarter, it projected earnings from continuing
operations of $1.05 to $1.10, bracketing the average Street
estimate.
Wal-Mart shares were up 0.5% to $56.38 in premarket trading.
They closed Monday at $56.06
-By Matt Jarzemsky, Dow Jones Newswires; 212-416-2240;
matthew.jarzemsky@dowjones.com