8/20/2014

Currently

85°F

Clear
Humidity: 22%
Pressure: 29.78 in

Business

Wal-Mart lowers profit expectations for quarter, year

Wal-Mart lowers profit expectations for quarter, year
In this May 9, 2013 file photo, a worker pushes shopping carts in front of a Wal-Mart store in La Habra, Calif. (AP Photo/Jae C. Hong, File)
Show Caption
BENTONVILLE, Ark. (AP) - Wal-Mart said Friday that its fiscal fourth-quarter and full-year adjusted earnings from continuing operations may come in at or slightly below the low end of its prior forecasts.

The latest comments from the world's biggest retailer reflects accounting for some Brazil-related charges and other items. Chief Financial Officer Charles Holley said in a statement that these additional items were not anticipated when Wal-Mart previously provided its forecasts.

Shares of the Bentonville, Ark., company fell 70 cents to $74.05 in premarket trading about 45 minutes ahead of the market opening.

Wal-Mart Stores Inc. also revised its fourth-quarter guidance for a key sales metric. It now expects sales - excluding fuel - at Walmart and Sam's Club locations in the U.S. open at least a year to be slightly below its prior forecasts. The chain previously expected the key sales figure would be relatively flat at its namesake locations in the U.S. and that it would be between flat and 2 percent at Sam's Club.

Sales at stores open at least a year is a closely-watched indicator of a retailer's health. It excludes results from stores recently opened or closed that can distort year-to-year comparisons.

Holley said that the sales were hurt by eight winter storms that resulted in some store closings. He added that Sam's Club was hurt by weather throughout the quarter. The performance was also hindered by a bigger-than-expected impact from the federal government's reduction in Supplemental Nutrition Assistance Program benefits that went into effect on Nov. 1.

Less than a week ago Wal-Mart announced that it was eliminating 2,300 workers at its Sam's Club division. The layoffs, which cut 2 percent of the membership club's U.S. employee count of about 116,000, mark the largest since 2010 when the Sam's Club unit laid off 10,000 workers as it moved to outsource food demonstrations at its stores.

Wal-Mart previously projected fourth-quarter adjusted earnings from continuing operations between $1.60 and $1.70 per share. Its 2014 guidance was for $5.11 to $5.21 per share.

Analysts surveyed by FactSet predict fourth-quarter earnings of $1.65 per share and full-year earnings of $5.16 per share.

Wal-Mart, which has 11,096 stores, said that it will provide detailed fourth-quarter and full-year financial results as well as guidance for fiscal 2015 on Feb. 20.
Share:
Bank of America reaches $17 billion settlement with US Bank of America reaches $17 billion settlement with US