Walmart Q2 update
Walmart held a conference call for investors to talk through the latest Q2 results. The following comments were made:
Walmart president and CEO Mike Duke said:
- Our international business continues to be an impressive growth engine, and Walmart International grew operating income faster than sales.
Walmart International president and CEO Doug McMillon said:
- In the United Kingdom, Asda continues to make good progress towards their strategic goals.
- In May, Asda announced its intent to acquire from Dansk Supermarked A/S, the Netto Food stores located in the U.K. These stores will bring many great new locations and a platform for smaller store formats throughout the United Kingdom. Of course, the acquisition is subject to regulatory approval and is expected to close later this year.
- In the second quarter, Asdaâ€™s sales grew in the low single digits, while comp sales without fuel declined 40 basis points. According to Kantar Worldpanel, Asdaâ€™s market share dropped slightly in the 12 weeks ending July 11.
- Asdaâ€™s gross margin as a percentage of sales increased in the second quarter on a mix shift towards higher-margin George and general merchandise. George had a particularly strong quarter, with strong sales of World Cup related merchandise and our 100 day quality guarantee. Customers continue to respond well to our guarantee, and we continue to see this as a unique competitive advantage in the market.
- Expenses as a percent of sales declined slightly as the Asda “we operate for less” program continues to deliver efficiencies. As a result, operating income grew faster than sales.
- On e-commerce, Asdaâ€™s second dedicated home shopping centre will open next week and will provide enhanced coverage in an area of low market share for Asda.
- Asdaâ€™s customers are facing recently announced tax increases and cuts in government spending. These are likely to cause our UK customers to face a challenging 12 to 18 months. Recent price reductions on high volume staples such as milk and eggs and the guaranteed lowest basket price shows Asdaâ€™s commitment to provide the value our customers expect and trust us to deliver.
Posted inon 17 August 2010