Worlds largest retailer, Wal-mart stores Inc., said earnings rose this Monday by 3.8 per cent in the third quarter as sales grew 10 per cent. Net income rose to $2.4 billion, or 54 cents per share, a year ago. Earnings in the latest quarter included three items, along with hurricane related costs that reduced numbers by $80-million, or 2 cents per share.
Net sales increased by 10.1 per cent from $68.5-billion to $75.4-billion in the third quarter of fiscal 2005. Overall revenue was boosted from $69.3-billion a year ago to 76.2-billion through other income.
Analysts had forecast income of 57 cents per share on sales of $76.35-billion after surveying Thomson Financial on an average. Wal-Mart shares rose 37 cents to $49.37 in pre-market trading.
The strong numbers had come in despite gasoline topping $3 per gallon, higher heating oil and natural gas prices and three hurricanes — Katrina, Rita and Wilma — that paralysed hundreds of stores temporarily, notes Wal-Mart chief executive Lee Scott.
Mr. Scott referred to the quarter as a “pretty good performance in a difficult environment.” The
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| hurricanes would in the longer term improve employment and the economy but said January and February could be difficult months when holiday bills come due and higher heating oil and natural gas prices have a greater impact said Mr. Scott.
Vice chairman John Menzer said the company is starting to see the effects of a restructuring of how stores are run. He said the focus is “close-to-the-customer decision making” and one result is stores that are less cluttered.
Earnings per share for the fourth quarter of 82 cents to 86 cents, yielding earnings for the year of $2.64 to $2.68 per share has been forecasted by Wal-Mart. Analysts surveyed by Thomson Financial forecast quarterly income of 84 cents per share and full-year income of $2.64 per share.
Chief financial officer Tom Schoewe has said that store sales for the fourth quarter are expected to rise between 3 per cent and 5 per cent.
Wal-Mart has posted an increase of 3.8 per cent for the quarter in sales at U.S. stores open for a minimum of 1 year now. The Wal-Mart division, which includes discount stores, super centers and Neighbourhood Market grocery stores, same-store sales, were up 2.9 per cent. Sales, compared at Sam’s Club warehouse stores were up by 8.1 per cent. 
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