Walmart Earnings, Q1 FY 2013
Walmart has today released its Q1 earnings for FY 2013. The period covered by Walmart’s announcement is Asda’s first quarter from 1 January 2012 to 31 March 2012. The full press release and investor relations script can be found at www.walmartstores.com/investors, but for ease of reference we’ve pulled out the specific mentions of Asda.
- Like for like sales, for 12 weeks from 8 January to 31 March 2012 grew 2.2 per cent, excluding acquisitions, VAT and fuel
- Like for like sales reported by Walmart for the full calendar quarter, including the additional leap year day increased 5.0 percent excluding acquisitions, VAT and fuel
- Like for like customer numbers in the calendar quarter were up by 2.9 per cent with basket spend up 2.1 per cent
- Total sales, excluding acquisitions, VAT and fuel, grew by 7.1 per cent
Commenting on the results Andy Clarke, CEO and President of Asda said:
“I’m proud of the work our stores, depots and teams at Asda House and George House put in during the quarter, to build on our end-of-year momentum and deliver market-leading growth. Customers really valued our price leadership, the ongoing improvements in quality and our commitment to warm and friendly service.”
On the call, Doug McMillon, President & CEO of Walmart International said:
“The U.K. had a strong first quarter, growing sales, and growing operating income faster than sales, excluding fuel. In the first quarter of this year, overall sales grew 7.1 per cent and comparable sales increased 5.0 per cent, excluding acquisitions and fuel, driven by core growth in grocery and children’s apparel. The comparable sales included a strong first week in January.”
- The overall sales growth of 7.1% excludes acquisitions, VAT and fuel, and therefore exclude sales from Asda’s converted Netto stores.
- You will also recall at Q4, Asda provided a 14 week LFL sales number to 7 January 2012, to account for the final week of Christmas and New Year trading. Asda’s LFL for the 12 weeks to 31 March 2012, excluding both this week and the benefit of an additional day in the quarter due to the leap year, was 2.2 per cent (excluding VAT & fuel).
Doug McMillon went on to say:
“Traffic in the quarter increased by 2.9 per cent, and average ticket also increased by 2.1 per cent. In addition, our online business in the U.K. maintained its strong performance, with sales growth of 19.2 per cent in the quarter.
“With customers trusting EDLP, we carried the momentum gained over Christmas into the first quarter. The ASDA price guarantee attracted more than 500,000 online checks per week in the first quarter.
“The U.K.’s gross profit rate, excluding acquisitions, was relatively flat compared to last year. Excluding acquisitions and last year’s pension costs, first quarter expenses as a percentage of sales grew slower than sales. We continue to sell at lower prices by embedding cost savings programs in operations.
“ASDA added three new stores [Worcester, Tunbridge Wells and Ramsgate] in the quarter and ended the first quarter with a total of 544 stores, including 32 Supercentres, 310 Superstores, 27 Living stores and 175 supermarkets.
“In March, we announced the acquisition of GAAT, which is a division of the Türkman Group, based in Istanbul. GAAT performs the design and sourcing of our successful George apparel brand, and the synergies from the new relationship will enhance our global sourcing capabilities. The transaction closed in April, which falls into the second quarter.”
Click here to see the business briefing by Andrew Moore, Executive Managing Director of George, following the completion of the sourcing division of GAAT.