Wal-Mart Q2 profit up 17 percent
Wal-Mart Stores (NYSE: WMT) raised its full-year earnings forecast after second-quarter profit rose more than expected, helped by tight inventory controls and a renewed focus on low prices.
Wal-Mart earned $3.45 billion in the quarter ended July 31, up 17 percent from $2.95 billion a year earlier. Profit from continuing operations rose 9.3 percent to $3.39 billion, while net sales gained 10 percent to $101.6 billion.
For the quarter, the company posted same-store sales growth of 4.5 percent, excluding fuel sales, compared to a 1.9 percent increase a year earlier.
Wal-Mart attributed the better second-quarter profits to tighter inventory controls, which led to fewer markdowns on merchandise. The company also noted that it met its goal of having inventory grow at half the rate of its sales growth.
Second-quarter sales for Wal-Mart's international division rose 19.3 percent to $25.3 billion.
At Wal-Mart's U.S. stores, sales rose almost 8 percent to $64.1 billion, while the Sam's Club warehouse store division posted a 7.8 percent sales gain to $12.28 billion.
Wal-Mart predicts same-store sales growth to slow to 1 percent to 2 percent for the third quarter, a sharp decline from the 4.5 percent it saw in the second quarter.
The company now expects to earn $3.43 to $3.50 per share for the year, up from a full-year forecast issued in February of $3.30 to $3.43 per share. Wal-Mart also said its profits for the current quarter should be from $0.73 to $0.76 per share.
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