“In the current economic environment, our customers depend on Wal-Mart to save them money on merchandise that they need,” said Eduardo Castro-Wright, Wal-Mart Stores U.S. president and chief executive officer. “Customers are responding to the pricing initiatives and traffic trends are improving. However, this is impacting gross margins.”
Sam's Club: Sam's Club's sales for the four-week period were driven by continued momentum with small business owners. Sales were driven by increases in average ticket. In addition to small business categories, other strengths included electronics, fresh food and grocery.
As the month of August gets under way, the clubs are completing the transition from summer outdoor goods to a furniture gallery and back-to-college in many markets. A fall merchandise transition will begin in September. The fuel impact was a minimal negative 20 basis points for the four-week period.
International: The Company continues to see the same pressures as in the United States on customers in its international markets, particularly in Mexico where the economy is experiencing lower growth and less consumer demand. However, there were positive sales results in certain markets, including Brazil and the U.K. In Brazil, sales were driven by an improved price position and recovery of consumer purchasing power.
Guidance: The Company expects the comparable store sales of its United States operations for the August four-week reporting period to be between 1 and 2 percent, said Tom Schoewe, executive vice president and chief financial officer. The August four-week period runs from August 4 through August 31, 2007.
As previously noted, the Company reports net sales and comparable store sales consistent with the National Retail Federation (NRF) calendar. The NRF calendar for the most recently completed year included 53 weeks, but includes only 52 weeks this year. The weekly sales information for the four-week and 26-week periods ended August 4, 2006 reported in this release match the comparable weeks for the current fiscal year. However, these four-week and 26-week comparable store sales periods reported for last year ended July 28, 2006, one week earlier.
The Company has posted on its Web site in investors section, a “reclassification” document showing prior year comparable store sales re-grouped to match the comparable weeks for the current reporting calendar. The reclassification for the August four-week period for the total Company comparable store sales is 2.9 percent, excluding the impact of fuel.
marketing@alchempro.com
