Wal-Mart Reports First Quarter Financial Results: Earnings Per Share of $0.77

BENTONVILLE, Ark., May 14, 2009 -- Wal-Mart Stores, Inc. (NYSE: WMT) today reported diluted earnings per share for the first quarter of fiscal year 2010 of $0.77, at the high end of the company’s guidance of $0.72 to $0.77. Currency exchange rates negatively impacted earnings by approximately $0.04 per share. Wal-Mart earned $0.76 per share in the first quarter last year.

Net sales for the first quarter were $93.471 billion, a decrease of 0.6 percent from $94.042 billion in the first quarter last year. Without the negative impact of currency exchange rates, equal to $4.836 billion, net sales for the quarter increased 4.5 percent to approximately $98.307 billion on a constant currency basis. In addition, this year’s first quarter contained one less selling day than the same quarter last year, because 2008 was a leap year. Income from continuing operations for the first quarter of $3.030 billion was relatively flat compared to the same period last year.

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“We’re pleased to report that fiscal year 2010 is off to a very good start,” said Mike Duke, Wal-Mart Stores, Inc. president and chief executive officer. “These results were achieved in the face of a very challenging global economy.

“When economic conditions improve, we believe customers who shop Wal-Mart today will stay with us, because of the business improvements we’re making and continue to make,” Duke said. “Across the company, we are building our brand by reducing costs, sharpening our merchandising and updating our stores.

"Customers trust Wal-Mart,” Duke continued. “As a result of the increasing shift to value, they have long term loyalty to the Wal-Mart brand because we save them money."

Reported International sales were negatively affected by currency translations to the U.S. dollar equal to $4.836 billion. On a constant currency basis (assuming currency exchange rates remained the same as the prior year), International sales increased 9.1 percent to $26.099 billion in the first quarter, compared to the same quarter last year.

Reported International operating income for the three months ended April 30, 2009 also was negatively affected by $252 million as a result of currency translations to the U.S. dollar. On a constant currency basis (assuming currency exchange rates remained the same as the prior year), International operating income increased 7.8 percent to $1.132 billion in the first quarter.

When reporting earnings in prior quarters, the company also reported comparable store sales on a monthly calendar basis. Effective this quarter, the company now will report comparable store sales for the most recently completed 13-week period, on its 4-5-4 retail calendar.

Data in the condensed consolidated financial statements included in this news release are based on the calendar quarters ending April 30.

Guidance “We expect earnings per share from continuing operations for the second quarter of fiscal year 2010 to be between $0.83 and $0.88,” said Tom Schoewe, Wal-Mart Stores, Inc. executive vice president and chief financial officer. “Our guidance takes into account Wal-Mart’s strong underlying performance and the difficult economic environment. Plus, our U.S. businesses will be up against the economic stimulus checks in the second quarter last year.

“The company is in a great financial position, and we’re proud of our strong balance sheet and the free cash flow generated by our operations,” Schoewe added. “We’re doing an excellent job taking care of our customers and we’ll continue to help them save money so they can live better long after the economy recovers."

The company announced last week that it will no longer report monthly comparable store sales. The 13-week comparable store sales results will be reported as part of quarterly earnings news, as noted above. Effective with this quarter, the company will provide 13-week comparable store sales guidance separately for Walmart U.S. and Sam’s Club.

3 Walmart U.S. and Sam’s Club each expect their comparable store sales during the 13-week period from May 2 through July 31 to be between flat and three percent. Wal-Mart will report each operating segment’s comparable store sales result and the total U.S. aggregate comparable store sales result for that period when it reports second quarter earnings on Aug. 13.

Effective Feb. 1, 2009, the company adopted Statement of Financial Accounting Standards No. 160, “Noncontrolling Interests in Consolidated Financial Statements, an amendment of ARB 51.” This standard requires modifications to financial statement presentation for minority interests in subsidiaries, now referred to as noncontrolling interests. These changes are reflected in Wal-Mart’s first quarter condensed consolidated financial statements included in this release. As a result, all references to income from continuing operations or earnings per share from continuing operations in this release refer to income from continuing operations attributable to Wal-Mart, or diluted income per share from continuing operations attributable to Wal-Mart, respectively.

In addition to these changes, beginning Feb. 1, 2009, the company changed the classification of certain revenue and expense items within the financial statements. These changes are reflected in the first quarter condensed consolidated statements of income for all periods presented and did not have an impact on the company’s consolidated operating or net income.

After this earnings release has been furnished to the SEC, a pre-recorded call offering additional comments on the quarter will be available to all investors. Callers may listen to this call by dialing 203-369-1090. The information included in this release, including reconciliations, and the pre-recorded phone call is available in the investor information area on the company’s Web site at www.walmartstores.com/investors.

Source: Wal-Mart