Wal-Mart Stores, Inc.

Size: px

Start display at page:

Download "Wal-Mart Stores, Inc."

Blaise Parker
5 years ago
Views:

1 Wal-Mart Stores, Inc. Tom Schoewe Executive Vice President & Chief Financial Officer Bear Stearns 13th Annual Retail, Restaurant and Consumer Conference February 27, 2007

2 Forward Looking Statement Wal-Mart includes the following cautionary statement to take advantage of the safe harbor provisions of the PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 for any forwardlooking statements made by, or on behalf of, Wal-Mart. You are referred to Wal-Mart s SEC filings for additional information regarding the safe harbor. The factors which could cause actual results to differ materially from predicted results include, among other things, cost of goods, competitive pressures, geopolitical conditions, labor and healthcare costs, inflation, consumer spending patterns and debt levels, currency exchange fluctuations, trade restrictions, changes in tariff and freight rates, fluctuations in the costs of gasoline, diesel fuel and other energy, accident and insurance costs, interest rate fluctuations and other capital market conditions, weather conditions, storm related damage to our facilities and customer traffic, regulatory matters and other risks set forth with the company s filings with the SEC.

3 Wal-Mart s Mission Saving people money so they can live better.

4 4th Quarter - Fiscal Year 2007 Financial Results

5 Consolidated Statements of Income Amounts in billions except EPS QUARTER ENDED JANUARY % CHG Net Sales $98.1 $ % Gross Profit $ % $ % 12.4% SG&A Expenses $ % $ % 14.0% Income Before Taxes $ % $ % 9.3% Net Income Cont. Ops. $ % $ % 8.8% Discontinued Ops. $0.0 ($0.03) Net Income $3.9 $ % EPS (cont. ops) $0.95 $0.87 EPS $0.95 $0.86

6 Business Segments Sales & Operating Profit vs. Last Year FY07 4 th Quarter Continuing Operations - Reported 35% 30% 25% 20% 15% 10% 5% 0% 6.7% 11.3% 4.4% 15.4% 29.6% 32.0% Wal-Mart Sam's International Reported Sales Operating Profit

7 Fiscal Year 2007 Financial Results

8 Consolidated Statements of Income Amounts in billions except EPS YEAR ENDED JANUARY % CHG Net Sales $345.0 $ % Gross Profit $ % $ % 13.4% SG&A Expenses $ % $ % 14.8% Income Before Taxes $ % $ % 8.2% Net Income Cont. Ops. $ % $ % 6.7% Discontinued Ops. ($0.9) ($0.2) Net Income $11.3 $ % EPS (cont. ops) $2.92 $2.72 EPS $2.71 $2.68

9 Business Segments Sales & Operating Profit vs. Last Year Fiscal Year 2007 Continuing Operations - Reported 35% 30% 25% 20% 15% 10% 5% 0% 7.8% 11.1% 4.5% 9.2% 30.2% 21.5% Wal-Mart Sam's International Reported Sales Operating Profit

10 Business Segments Operating Income Margin Fiscal Year 2007 Continuing Operations - Reported 8.00% 7.00% 7.5% 7.4% 7.4% 7.3% 7.5% 6.00% 5.00% 5.6% 5.9% 6.1% 5.9% 5.5% 4.00% 3.00% 3.5% 3.5% 3.2% 3.3% 3.6% FY03 FY04 FY05 FY06 FY07 Wal-Mart Sam's International

11 Consolidated Sales vs. Inventory Growth (% Increase) - Reported 20% 15% 10% 11.3% 5.6% 12.6% 7.8% 11.6% 11.4% 9.0% 12.0% 9.8% 8.5% 11.3% 5.6% 5% 0% FY02 FY03 FY04 FY05 FY06 FY07 Sales Inventory

12 FY07: Another Record Year of Revenue & Earnings (continuing operations) Wal-Mart Earnings Per Share $2.92 $0.95 $0.95 FY 99 FY 07 Q4 FY99* = Q4 FY07 FY07 * Includes Germany & South Korea

13 Consolidated Statements of Cash Flows Twelve months ended as of January 31, 2007 Amounts in millions FY07 Cash Flow from Operations +13.9% $20,209 Capital Expenditures + 7.9% ($15,666) FY06 Cash Provided by Cont. Ops. Activities $20,209 $17,737 Capital Expenditures (15,666) (14,530) Acquisitions, net of cash acquired (68) (601) Other Investments 1, Cash Used in Investing Activities ($14,507) ($14,156) Net Proceeds from Borrowings 248 4,263 Dividends Paid +11.6% ($ (2,802) (2,511) Purchase of Common Stock (1,718) (3,580) Other Financing Activities (567) (594) Cash Used in Financing Activities ($4,839) ($2,422) Effect of Exchange Rates on Cash 97 (101) Change in Cash & Cash Equivalents Cont. Ops. $960 $1,058 Available Cash after Capex & Dividends $ 1,741 Change in Cash Disc. Ops. ($1) ($132) Net Change in Cash & Cash Equivalents $959 $926

14 Cash Flow from Operations After Paying for Capex and Dividends Continuing Operations (US$ Billions) $20 $15 $ $5 FY03 FY04 FY05 FY06 FY07 Net Cash from Ops. CAPEX Dividends

15 What We Said About ROI Wal-Mart U.S. - Reverse trend - Flatten FY07 -Improve Sam s Club International -Trend - Acquisitions

16 Strong Financial Results, but Questions Remain About FY 08 Strategy You are asking: - Is traffic declining? - Are Wal-Mart associates engaged in delivering superior customer service? - Are we reaching upscale customers? - What is the impact of remodeling on traffic?

17 We can deliver strong financial results and improve customer experience in Wal-Mart U.S. stores

18 Wal-Mart U.S. 3-year 3 Strategic Plan Customer Relevancy Market Research & Segmentation Organization Structure In-Market Pilots Low Prices, Always Store Experience Merchandise Assortment Layout & Adjacencies Chain-wide Rollout Year 1 Year 2 Year 3

19 Myths vs. Facts Myth: Traffic at Wal-Mart U.S. is down & continues to decline.

20 Total traffic has expanded steadily Store experience relevance Added almost 200 MM transactions in FY 07!

21 Myths vs. Facts Myth: Fewer Americans with higher income demographic traits like Wal-Mart. More of these Americans are choosing competitors over Wal-Mart.

22 Affluent Americans: Favorite Store is Wal-Mart Retailers Shopped Past Seven Days By Households >$60K Wal-Mart Target Home Depot Best Buy Walgreens Lowes CVS Costco JCP Sam's Kohl's Source: NPD Retailer Profiles/Upper Income Shopper Analysis December 2005

23 Myths vs. Facts Myth: Remodeling and special project work at Wal-Mart U.S. stores is impacting traffic very negatively.

FY 07 Finish apparel and electronics special projects in FY

24 Remodeling & Special Project Update Continue remodeling at 325 stores in FY 08 Completed 1,300 special projects during FY 07 Finish apparel and electronics special projects in FY 08 Do a few more home special projects during FY 08 Q1-2, evaluate

25 INTERNATIONAL

26 International - ASDA Core Business Growth In the Growth Markets Customer Leadership Internal Processes & Leadership

27 ASDA - A Strong Start to 2007 Extra Special and Organics relaunch Collections by George launch Furniture and electricals online Price breakthrough in general merchandise Increased market share (TNS)

28 Strong Performance in January: ASDA Strongest YoY Growth of Big (5.0) (10.0) (15.0) (20.0) Feb 06 Apr 06 Jun 06 Aug 06 Oct 06 Dec 06 Jan 07 Mar 07 May 07 Jul 07 Sep 07 Nov 07 Jan 07

29 FY06 FY04 FY05 FY03 Seiyu Comp Store Sales 2.0% 0.0% -2.0% -4.0% -6.0% -8.0% FY92 FY93 FY94 FY95 FY96 FY97 FY98 FY99 FY00 FY01 FY02

30 Seiyu Remodels Stores FY03 FY04 FY05 FY06 65

31 Seiyu s Improved Store Portfolio Hitachinoushiku Sendai-izumi Atsuta-sanbancho 3 new stores; 13 closures

32 Seiyu s FY 07 Initiatives New stores Focus on customer Offer quality & value Strengthen partnership with suppliers Make environmental sustainability key focus Build robust supply chain Create synergies of 17 companies working as one

33 Trust-Mart - China 101 stores in 34 cities Deal structure Wal-Mart China operates 73 stores in 36 cities

34 Wal-Mart s Mission Worldwide Saving people money so they can live better.

35 Wal-Mart Stores, Inc. (WMT) Thank you!

Sam s Club. Jefferies 2013 Global Consumer Conference. Michael Dastugue, Chief Financial Officer of Sam s Club

Sam s Club. Jefferies 2013 Global Consumer Conference. Michael Dastugue, Chief Financial Officer of Sam s Club Sam s Club Jefferies 2013 Global Consumer Conference Michael Dastugue, Chief Financial Officer of Sam s Club Wal-Mart Stores, Wal-Mart Inc. Stores, (NYSE: Inc. WMT) (NYSE: WMT) Forward-looking statement