In this May 9, 2013 photo, a worker pushes shopping carts in front of a Walmart store in La Habra, Calif.
Jae C. Hong, Associated Press
Wal-Mart lowers profit forecast
- Article by: ELIZABETH A. HARRIS
- New York Times
- January 31, 2014 - 8:56 PM
Wal-Mart Stores Inc. lowered its profit expectations for the latest quarter, citing lower grocery sales resulting from cuts to food stamps and an especially tough winter.
The nation’s largest retailer said Friday that profit is likely to come in at the low end of its guidance range of $1.60 to $1.70 a share — or even slightly below. The quarter ended on Friday.
The company is to report fourth-quarter and full-year earnings Feb. 20.
Despite a decent holiday season, Charles Holley, the company’s chief financial officer, noted that the impact on shoppers of reductions to the federal Supplemental Nutrition Assistance Program, also known as food stamps, was “greater than we expected.”
He also pointed to the severe weather, including “eight named winter storms” during the quarter that forced some stores to close. The weather affected the company’s Sam’s Club stores as well, Holley said.
The retailer said it expects to incur severance-related costs associated with its Sam’s Club chain. The company said last week that it would lay off 2,300 Sam’s Club employees and close one location.
The company has previously projected that sales in the domestic market would be level during the fourth quarter and that sales at Sam’s Club would be between flat and up 2 percent. Holley said that sales at both divisions are now expected to come in slightly below that guidance.
Internationally, the retailer faces challenges as well. About 50 underperforming stores in China and Brazil have been closed.
© 2014 Star Tribune