Walmart reported fourth quarter diluted earnings per share from continuing operations (reported EPS) of $1.41. This compares to $1.261 per share from continuing operations last year. Fourth quarter underlying diluted EPS from continuing operations was $1.342.
Reported EPS from continuing operations for the fourth quarter included tax benefits of $243 million, or approximately $0.07 cents per share.
Consolidated operating income for the fourth quarter was $8.0 billion, up 7.3 percent from last year.
Net sales for the fourth quarter were $115.6 billion, an increase of 2.5 percent from last year.
Walmart U.S. comparable store sales declined 1.8 percent in the 13-week period ended Jan. 28, 2011. Sam's Club comparable sales, without fuel, increased 2.7 percent for the same period.
Full year reported EPS from continuing operations was $4.18, compared with last year's EPS of $3.731.Full year underlying diluted EPS from continuing operations was $4.072.
Consolidated operating income for the full year was up 6.4 percent to $25.5 billion.
Net sales for the full year were $419 billion,an increase of 3.4 percent.
The company leveraged operating expenses for the quarter and the full year.
Return on investment (ROI) for the fiscal year ended Jan. 31, 2011 remained strong and stable at 19.2² percent.
Walmart ended the year with strong free cash flow of $10.92 billion.
For the year, the company returned a record $19.2 billion to shareholders through dividends and share repurchases.
1Effective with the second quarter of fiscal year 2011, Walmart changed its methodology for valuing inventory.The retrospective application of this accounting change resulted in adjustments to reported amounts for last fiscal year.The company provided adjusted financial statements reflecting the changes for each quarter of fiscal year 2010 and the first quarter of fiscal year 2011 on its website.All references made throughout the text of this release to comparative fiscal 2010 financial results have been adjusted to reflect the retrospective application of this accounting change.Also see notes on page 6.
2See additional information at the end of this release regarding non-GAAP financial measures.


BENTONVILLE, Ark., Feb 22, 2011 (BUSINESS WIRE) -- Wal-Mart Stores, Inc. (NYSE: WMT) today reported financial results for the quarter and the year ended Jan. 31, 2011. Net sales for the fourth quarter of fiscal year 2011 were $115.6 billion, an increase of 2.5 percent from $112.8 billion in the fourth quarter last year.

Net sales included a currency exchange rate benefit of $664 million. Income from continuing operations attributable to Walmart for the quarter was $5.0 billion, up from $4.8 billion in the fourth quarter last year.

Diluted earnings per share from continuing operations attributable to Walmart ("reported EPS") for the fourth quarter of fiscal year 2011 were $1.41. The underlying diluted earnings per share from continuing operations attributable to Walmart ("underlying EPS") were $1.343, exceeding consensus estimates and company guidance. Underlying EPS for the fourth quarter represents reported EPS that is adjusted to exclude the effects of certain tax benefits of $243 million, or approximately $0.07 per share. The tax benefits are due primarily to the repatriation of certain non-U.S. earnings that increased U.S. foreign tax credits.

By comparison, underlying EPS for the fourth quarter of fiscal 2010 was $1.213. The amount reflects an adjustment to reported EPS to exclude several restructuring charges totaling $260 million ($162 million net of tax), or approximately $0.04 per share, and a net tax benefit of $372 million or approximately $0.09 per share.

For the fourth quarter, the company recognized in discontinued operations, an approximate $1.0 billion tax benefit in connection with the disposition of its German operations in fiscal 2007. This matter was resolved with the U.S. Internal Revenue Service during the fourth quarter of this fiscal year. Diluted earnings per share attributable to Walmart, inclusive of continuing operations and discontinued operations of $0.29 per share from the recognized tax benefit, were $1.70 for the fourth quarter.

Fiscal 2011 results

Net sales for the fiscal year were $419 billion, an increase of 3.4 percent over fiscal 2010. Net sales included a currency exchange rate benefit of $4.5 billion. Income from continuing operations attributable to Walmart were $15.4 billion, a 6.3 percent increase from $14.4 billion last year.

For fiscal year 2011, reported EPS and underlying EPS were $4.18 and $4.073, respectively, versus $3.73 per share and $3.673 per share, respectively, in the prior year. Fiscal 2011 reported EPS reflects certain tax benefits recorded in the third and fourth quarters that aggregate to approximately $0.11 per share. Diluted earnings per share attributable to Walmart for fiscal 2011, inclusive of continuing operations and discontinued operations from the recognized tax benefit, were $4.47.

Pleased with earnings performance

"We are pleased with Walmart's strong earnings performance for both the fourth quarter and the full year across our three operating segments. At the same time, we are disappointed by Walmart U.S. fourth quarter sales," said Mike Duke, Wal-Mart Stores, Inc. president and chief executive officer.

Duke pointed out that under the leadership of President and CEO Bill Simon, Walmart U.S. is implementing a four-point plan designed to deliver better results. He acknowledged that it will take some time to see positive comparable store sales.

"Some of the pricing and merchandising issues in Walmart ran deeper than we initially expected, and they require a response that will take time to see results," Duke explained. "There is no greater priority for Bill or me than getting sales back into positive territory."

3 See additional information at the end of this release regarding non-GAAP financial measures.

The Walmart U.S. four-point plan is designed to improve performance in existing stores. The points are:

1. EDLP price leadership. Walmart will deliver consistent every day low price on a basket of goods.

2. Broadest assortment possible. Walmart is always working with suppliers to deliver the broadest and most relevant assortment possible at the lowest price in the market. This includes continued focus on adding merchandise back on the shelves, as well as in action alley in the stores.

3. Improve remodel program. Improve store remodel efficiency and returns to right size square footage for various merchandise departments and categories.

4. Multi-channel initiatives. Increase access for customers through multi-channel shopping options so they can shop on their own terms.

"We are confident that through these initiatives, as well as the commitment of our 1.4 million associates, we can improve sales throughout the rest of the year," Simon said. "And, we will make meaningful progress on new store growth, as we add supercenters and expand our store format portfolio."

Duke also recognized the strong full year operating results of Walmart International and Sam's Club.

"Walmart International continues to be our growth engine, and we expect accelerated growth in emerging markets. International net sales exceeded $109 billion this year, an increase of more than 12 percent over the prior year. Every country contributed a sales increase in fiscal 2011, compared to the prior year," Duke said. "Sam's Club reached almost $50 billion in annual net sales. And, during the year, Sam's Club comp sales, excluding fuel, improved sequentially every quarter, with the fourth quarter being the strongest."

The company leveraged operating expenses for the fourth quarter and the full year, as well as maintained a strong financial position. Walmart ended the year with strong free cash flow of $10.9 billion, compared to $14.1 billion the previous year. ROI for the full year ended Jan. 31, 2011 was 19.2 percent, compared to 19.3 percent for the prior year.

"Walmart's commitment to growth, leverage and returns continues to improve value for our shareholders," added Duke. "Between dividends and share repurchases, Walmart returned a record $19.2 billion to our shareholders during the fiscal year."

Walmart repurchased $3.8 billion in shares during the fourth quarter, raising this year's total to $14.8 billion. The company has approximately $4.8 billion remaining under the current share repurchase authorization.

Guidance

"Based on our views of the global economy and our three operating segments, we expect first quarter diluted earnings per share from continuing operations attributable to Walmart to be between $0.91 and $0.96, versus last year's EPS of $0.87," said Charles Holley, executive vice president and chief financial officer. "Further, we are guiding earnings per share from continuing operations attributable to Walmart for fiscal 2012 to a range of $4.35 to $4.50. These estimates assume that currency exchange rates remain at current levels."

Underlying EPS was $4.074 for fiscal year 2011, excluding approximately $0.11 per share of aggregate tax benefits recorded in the third and fourth quarters.

The company also updated the range for capital expenditures for fiscal 2012. Walmart projected on Oct. 13, 2010 that total company capital spending would range from $13.5 billion to $14.5 billion.

4 See additional information at the end of this release regarding non-GAAP financial measures.

"We closed fiscal 2011 having spent $12.7 billion, below the low-end of our forecast of $13.0 to $14.0 billion," Holley said. "We now expect capital expenditures for this new fiscal year to be between $12.5 and $13.5 billion. This lowers our guidance by $1.0 billion from our October forecast, and represents improved efficiency particularly in the Walmart U.S. segment, and thoughtful capital allocation to ensure our growth around the world.

"Walmart is continuing the processes to finalize the acquisitions of Massmart Holdings Limited in South Africa and the Netto stores in the U.K.," Holley explained. "Capital for these or future acquisitions are not included in this capital guidance.

"We closed the year with 985 million square feet of selling space. We continue to expect organic square footage growth between three and four percent in fiscal 2012," Holley said. "We also continue to expect net sales for fiscal 2012 to grow between four and six percent."