Tag Archives: paycheck to paycheck

Walmart’s Q2 2019 Results – Comments

I found various notable items in Walmart’s Q2 2019 management call transcript (pdf) dated August 16, 2018.  (as well, there is Walmart’s press release of the Q2 results (pdf) and related presentation materials)

I view Walmart’s results and comments as particularly noteworthy given their retail prominence and focus on low prices.  I have previously commented on their quarterly management call comments; these previous posts are found under the “paycheck to paycheck” tag.

Here are various excerpts that I find most notable:

comments from Brett Biggs, EVP & CFO, page 11:

U.S. eCommerce sales grew 40 percent in the quarter. We are
improving the value proposition through enhancements to the site, app,
assortment and experience, including the list of new initiatives that Doug
mentioned. We remain focused on nailing the fundamentals. The team is
making good progress on our Customer Value Index, or CVI, and we’re
particularly pleased with the trends related to price competitiveness and
delivery promise. Given the advantage of having stores in our omnichannel
offering, we are taking a more holistic view of the customer and
accelerating investments in grocery pickup and delivery. We feel good
about the direction of the business and remain confident in our ability to
grow sales by about 40 percent for the full year.

Walmart U.S.

Walmart U.S. delivered strong comp sales growth, excluding fuel, of
4.5 percent, marking the best performance in more than 10 years. Store
traffic growth of 2.2 percent and ticket growth of 2.3 percent were strong
across categories, and eCommerce contributed approximately 100 basis
points to the comp. Momentum in the business was solid throughout the
quarter, with warmer weather contributing to strong general merchandise
sales primarily in seasonal lawn & garden and apparel, which positively
impacted the Q2 comp. As you will recall, Q1 was hampered by very
unseasonably cool weather in April and Q2 was benefitted by
unseasonably warm weather in May. Year to date through Q2, Walmart
U.S comp sales, excluding fuel, were 3.3 percent.

comments from Brett Biggs, EVP & CFO, page 12, wrt Walmart U.S.:

Gross margin rate declined 34 basis points primarily related to price
investments, higher transportation expenses due to higher fuel costs and
third-party transportation rate pressure, and the increasing mix of our
growing eCommerce business.

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2846.18 as this post is written

Walmart’s Q1 2019 Results – Comments

I found various notable items in Walmart’s Q1 2019 management call transcript (pdf) dated May 17, 2018.  (as well, there is Walmart’s press release of the Q1 results (pdf) and related presentation materials)

I view Walmart’s results and comments as particularly noteworthy given their retail prominence and focus on low prices.  I have previously commented on their quarterly management call comments; these previous posts are found under the “paycheck to paycheck” tag.

Here are various excerpts that I find most notable:

comments from Doug McMillon, President and CEO, page 2, wrt Walmart U.S.:

Walmart U.S. continues to perform well with comp sales growth,
excluding fuel, of 2.1 percent. Greg and the Walmart U.S. team continue to
strengthen our supercenters. We’ve improved our merchandising in areas
like fresh food with better lighting, an expanded deli offer, and an improved
bakery layout to make it easier for customers to navigate. We also recently
introduced new apparel brands with improved design, quality and value.
Customer experience scores continue to improve as we’ve lowered prices
and taken steps to make shopping with us easier and more enjoyable. We
aim to make shopping easy, fast, friendly and fun for customers, and our
team continues to make progress towards that goal. I continue to be
impressed by the progress the team is making on inventory management.
They’ve put together a string of 12 quarters of reduced comp store
inventory while maintaining strong in-stock levels. eCommerce sales
accelerated in the first quarter with 33 percent growth, and we expect to
grow sales about 40 percent for the full year. Sam’s Club comps improved
5.2 percent, excluding fuel and a 140 basis point decrease for tobacco.
Outside of the U.S., eight of eleven markets posted positive comp sales,
including our four largest markets of Mexico, U.K., China and Canada. So
overall, we feel pretty good about this quarter.

comments from Doug McMillon, President and CEO, page 3, wrt Walmart U.S.:

I’ll start with Walmart U.S.

In addition to comp sales growth of 2.1 percent, more people
shopped with us as comp traffic improved 0.8 percent. Comp sales were
trending higher through early April, but general merchandise sales and
traffic were somewhat negatively impacted by unseasonably cool weather
in April. 

comments from Brett Biggs, EVP & CFO, page 8, wrt Walmart U.S.:

Gross margin rate declined 23 basis points primarily due to price
investments and higher transportation expenses as a result of higher fuel
costs and third-party transportation rate pressures.

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2722.46 as this post is written

Walmart’s Q4 2018 Results – Comments

I found various notable items in Walmart’s Q4 2018 management call transcript (pdf) dated February 20, 2018.  (as well, there is Walmart’s press release of the Q4 results (pdf) and related presentation materials)

I view Walmart’s results and comments as particularly noteworthy given their retail prominence and focus on low prices.  I have previously commented on their quarterly management call comments; these previous posts are found under the “paycheck to paycheck” tag.

Here are various excerpts that I find most notable:

comments from Doug McMillon, President and CEO, page 1, wrt Walmart U.S.: 

For the quarter, Walmart U.S. delivered strong comp sales growth of
2.6 percent due primarily to improved comp traffic growth in stores of 1.6
percent. Strength was broad-based across merchandise categories,
formats, and regions, and holiday sales were solid. In addition, comp store
inventory declined again for the eleventh consecutive quarter, so we’re
well-positioned as we begin the year. Sam’s Club comps improved 2.4
percent and in International, nine of eleven markets posted positive comp
sales. So overall, we were pleased with most aspects of the quarter and
confident in the foundational aspects of the business as we enter this new
fiscal year.

comments from Doug McMillon, President and CEO, page 2, wrt Walmart U.S.: 

Looking ahead, we expect eCommerce growth to increase from the
fourth quarter level as we enter the new year with about 40 percent growth
for the year.

comments from Doug McMillon, President and CEO, page 5:

Moving to Sam’s Club, you will remember that we made a decision
to close 63 Sam’s Club locations in the U.S. We’ve talked about
transforming the Sam’s business, and part of this transformation means
managing the club portfolio to include clubs that are both financially viable
and that fit within the strategic framework for the future. Closing stores and
clubs is difficult. It’s obviously difficult for our impacted associates and there
is never a good time to do it. John and the Sam’s team are working to place
as many of them as possible at nearby locations. These closures will help
us run a healthier business.

comments from Brett Biggs, EVP & CFO, page 8:

Before we get to the results, I’d like to highlight some
accomplishments for the full year.
 Total revenue surpassed $500 billion for the first time and increased
$15.1 billion, or 3.1 percent in constant currency.
 Walmart U.S. comp sales grew 2.1 percent – the highest growth rate
since fiscal 2009 – led by traffic growth of 1.4 percent.
 Walmart U.S. eCommerce sales grew 44 percent, reaching $11.5
billion.
 We made good progress on expenses, especially in Walmart U.S.
stores and International. Without the discrete items mentioned in
arriving at adjusted EPS, we would have leveraged expenses.
 Adjusted EPS increased 2 percent.
 Operating cash flow was $28.3 billion.
 The company returned $14.4 billion to shareholders through
dividends and share repurchases, and
 Strong working capital improvements continued.

comments from Brett Biggs, EVP & CFO, page 9:

Consolidated gross profit margin declined 61 basis points.
Approximately two-thirds of the decline was driven by price investments in
certain markets and the mix effect from our growing eCommerce business.
The remaining one-third was driven by Sam’s Club inventory markdowns
associated with closures, and other international items, including the winddown
of our Brazil first-party eCommerce business. Looking ahead to fiscal
2019, we’ll continue to make investments that will pressure the rate some,
but not to the extent of this quarter.

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2727.56 as this post is written

Walmart’s Q3 2018 Results – Comments

I found various notable items in Walmart’s Q3 2018 management call transcript (pdf) dated November 16, 2017.  (as well, there is Walmart’s press release of the Q3 results and related presentation materials)

I view Walmart’s results and comments as particularly noteworthy given their retail prominence and focus on low prices.  I have previously commented on their quarterly management call comments; these previous posts are found under the “paycheck to paycheck” tag.

Here are various excerpts that I find most notable:

comments from Doug McMillon, President and CEO, page 4, wrt Walmart U.S.: 

We had a strong quarter with comp-sales growth of 2.7 percent and
comp traffic growth of 1.5 percent. While we recognize that there are some
incremental hurricane-related sales in these numbers, our core business is
performing well.

comments from Doug McMillon, President and CEO, page 4, wrt Walmart U.S.: 

Walmart U.S. eCommerce sales were up 50 percent this quarter, with
the majority of the increase through Walmart.com. Existing customers have
become advocates for popular initiatives like online grocery and free twoday
shipping, and as a result, new customers, suppliers and partnerships
are coming to Walmart. The expanded assortment on Walmart.com has
also contributed to growth. Over the past year, we’ve tripled the number of
items on Walmart.com to reach more than 70 million SKUs today. As you
heard last month, Marc’s team is making progress on hiring additional
category specialists focused on improving the customer experience and our
positioning with the top one million eCommerce items. The recent
agreement with Lord and Taylor is a great example of how we will be
creating specialty experiences that complement what we offer and serve
customers with the brands they want. We’re making good progress
attracting premium brands to the site such as KitchenAid and Bose.

comments from Brett Biggs, EVP & CFO, page 7:

We expect top line growth going forward to be led more by comp
sales and eCommerce with less emphasis on new units in the U.S. We
have good sales momentum and cost transformation is gaining traction.
This gives us confidence in our ability to operate with discipline and
leverage expenses. In terms of capital allocation, we’re prioritizing
eCommerce, technology, supply chain and store remodels over new stores
and clubs, which we believe will contribute to long-term value creation for
shareholders. We’re excited about the future of Walmart.

comments from Brett Biggs, EVP & CFO, page 9:

Walmart U.S. eCommerce continued its strong performance with net
sales growth of 50 percent. We began to lap the acquisition of Jet.com
mid-quarter, which impacted our overall growth. Walmart.com, including
online grocery, once again led the way and was responsible for the majority
of the growth in the period. Throughout this year we’ve talked a lot about
the speed at which we’re moving, and we continued that progress in the
third quarter. For example, we launched new partnerships with Google and
August Home – these are capital-light initiatives that expand convenience
for customers by enabling hands free voice shopping and unattended
delivery in the home. We also acquired Parcel, a technology-based, sameday,
last-mile delivery company focused on customers in New York City.

comments from Brett Biggs, EVP & CFO, page 10, wrt Walmart U.S.:  

Walmart U.S. had a strong quarter with comp sales growth of 2.7
percent led by a traffic increase of 1.5 percent. While difficult to quantify
precisely, we estimate hurricane-related impacts benefited comps by 30 to
50 basis points. On a two-year stacked basis, comp sales were up 3.9
percent and comp traffic increased 2.2 percent. This is the strongest
quarterly and two-year stacked comp performance in more than eight
years. The food business continued to accelerate with sales, traffic and
unit growth across categories. In fact, food categories delivered the
strongest quarterly comp sales performance in almost six years. Market
inflation was around or slightly less than what we saw in the second
quarter. All formats had positive comps and eCommerce contributed
approximately 80 basis points to the segment.

Gross margin rate declined 36 basis points in the quarter. The
margin rate decreased in part due to the continued execution of our price
investment strategy and the mix effects from our growing eCommerce
business. In addition, we estimate that hurricane-related impacts were
about one-third of the overall decline.

Operating expenses as a percentage of net sales decreased 10 basis
points, with stores leveraging at a higher level than that. The U.S. team
has made great progress while maintaining high customer service levels,
as associates are more efficient with improved technology, training and
processes.

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2564.62 as this post is written

Walmart’s Q2 2018 Results – Comments

I found various notable items in Walmart’s Q2 2018 management call transcript (pdf) dated August 17, 2017.  (as well, there is Walmart’s press release of the Q2 results and related presentation materials)

I view Walmart’s results and comments as particularly noteworthy given their retail prominence and focus on low prices.  I have previously commented on their quarterly management call comments; these previous posts are found under the “paycheck to paycheck” tag.

Here are various excerpts that I find most notable:

comments from Doug McMillon, President and CEO, page 4, wrt Walmart U.S.: 

We had a strong quarter with comp-sales growth of 1.8 percent and
comp-traffic growth of 1.3 percent. It’s exciting that sales growth is coming
from across the business– including stores, e-commerce and a
combination of both.

comments from Brett Biggs, EVP & CFO, page 8:

Walmart U.S. eCommerce again performed very well on the topline
as GMV grew 67 percent and sales increased 60 percent, including
acquisitions. The majority of this growth was organic through
Walmart.com, including Online Grocery, which is growing quickly. We’re
delivering growth through an improved customer value proposition that
includes free two-day shipping on millions of items and Easy Reorder, as
well as an expanded assortment, now with more than 67 million SKUs – an
increase of more than 30 percent from the first quarter. With Easy
Reorder, we’re integrating both in-store and online purchases to provide
customers with a single spot to view and repurchase the items they buy
most frequently. Initiatives like these, along with everyday low prices, are
the reasons why customers are choosing Walmart in greater numbers. As
a reminder, we’ll begin to lap the Jet.com acquisition in the third quarter.

comments from Brett Biggs, EVP & CFO, page 9, wrt Walmart U.S.: 

Gross margin rate declined 5 basis points in the quarter. Savings
from procuring merchandise benefited the margin rate but was more than
offset by the mix effects from our growing e-commerce business, as well as
continued investments in price.

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2468.11 as this post is written

Walmart’s Q1 2018 Results – Comments

I found various notable items in Walmart’s Q1 2018 management call transcript (pdf) dated May 18, 2017.  (as well, there is Walmart’s press release of the Q1 results and related presentation materials)

I view Walmart’s results and comments as particularly noteworthy given their retail prominence and focus on low prices.  I have previously commented on their quarterly management call comments; these previous posts are found under the “paycheck to paycheck” tag.

Here are various excerpts that I find most notable:

comments from Doug McMillon, President and CEO, page 3, wrt Walmart U.S.: :

Comp store sales grew 1.4 percent and comp store traffic improved 1.5 percent. We got off to a slower start than expected, due in part to delayed federal tax refund checks, but saw sales strengthen throughout the quarter. We also continued to manage the business well from an inventory and availability standpoint.

comments from Doug McMillon, President and CEO, page 4:

In U.S. eCommerce, we like the traction and we are working hard to make even more improvements. Walmart.com launched two new initiatives in the quarter. First, we made the change to shipping terms at the beginning of the quarter. Customers don’t have to pay a membership fee to get two-day shipping on millions of items. Second, we recently began offering customers pick-up discounts on non-store items. Our stores are located within 10 miles of nearly 90 percent of the U.S. population—so this is convenient for many of our customers, and also saves them money when they order online and pick it up during their visit to our stores.

comments from Brett Biggs, EVP & CFO, page 7:

Gross profit margin increased 1 basis point during the quarter. The rate for Walmart U.S. was flat, while Walmart International was up slightly.

comments from Brett Biggs, EVP & CFO, page 8, wrt Walmart U.S.:

You will recall in our fourth quarter comments that the first quarter started out slower than anticipated from a sales standpoint, due in part to the delayed issuance of federal income tax refund checks. As anticipated, our sales strengthened as the quarter progressed, delivering comp sales growth of 1.4 percent, led by an increase in customer traffic of 1.5 percent. This marks the 10th consecutive quarter of positive comp traffic. On a twoyear stacked basis, comp traffic is up 3 percent. Average ticket declined slightly primarily due to lower sales of higher ticket items at the beginning of the quarter, as well as continued price investment. Additionally, the grocery business continued to improve with food categories delivering the strongest quarterly comp sales performance in more than three years, due in part to a lack of market deflation in food, excluding price investments.

comments from Brett Biggs, EVP & CFO, page 9, wrt Walmart U.S.:

Gross margin rate was flat in the quarter. Savings from procuring merchandise and the acceleration of post-holiday markdowns taken in the fourth quarter benefited the margin rate, but this was offset by investments in price and the mix effects from our growing e-commerce business.

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2357.03 as this post is written

Walmart’s Q4 2017 Results – Comments

I found various notable items in Walmart’s Q4 2017 management call transcript (pdf) dated February 21, 2017.  (as well, there is Walmart’s press release of the Q4 results and related presentation materials)

I view Walmart’s results and comments as particularly noteworthy given their retail prominence and focus on low prices.  I have previously commented on their quarterly management call comments; these previous posts are found under the “paycheck to paycheck” tag.

Here are various excerpts that I find most notable:

comments from Doug McMillon, President and CEO, page 2:

Good morning everyone. As you saw in our earnings materials this morning, we delivered a very solid quarter and it’s great to see continued momentum in the business. Total revenue grew 3.0 percent in the quarter and increased 3.1 percent for the year, both in constant currency. Comp sales growth of 1.8 percent in the Walmart U.S. business this quarter was better than expected, and I’m particularly pleased with the traffic in our stores. U.S. GMV grew 36 percent in the quarter, so we’re headed in the right direction with this important part of our business, too.

comments from Brett Biggs, EVP & CFO, page 7:

We saw strong growth this quarter in the Walmart U.S. eCommerce business with GMV and sales growth of 36 percent and 29 percent, respectively. Our integrated offering means customers are shopping with us through multiple channels. In fact, over the holidays, Pickup Today, which is available in Walmart U.S. stores, grew by 27 percent over last year.

comments from Brett Biggs, EVP & CFO, page 8:

We accomplished this while also returning a substantial amount of cash to shareholders. In fact, over the past year, we returned $14.5 billion to shareholders in the form of dividends and share repurchase. As of the end of the fiscal year, we had used approximately $10.8 billion of the current $20 billion share repurchase authorization. Additionally, today we announced an increase in our annual dividend from $2.00 per share to $2.04 per share in fiscal 2018. We’ve now increased our dividend for 44 consecutive years. We’re proud of our track record of returning significant cash to shareholders, while investing in future growth.

comments from Brett Biggs, EVP & CFO, page 9:

Gross margin decreased 8 basis points in the quarter. Savings from procuring merchandise as well as lower logistics costs benefitted the margin rate, but were more than offset by the continued execution of our price investment strategy and the timing of post-Holiday markdowns. We’re entering the new year in a very solid inventory position. For the year, Walmart U.S. gross margin increased 24 basis points. As a reminder, both fourth quarter and full-year comparisons included a $56 million impact last year related to store closures.

 

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2351.16 as this post is written

Walmart’s Q3 2017 Results – Comments

I found various notable items in Walmart’s Q3 2017 management call transcript (pdf) dated November 17, 2016.  (as well, there is Walmart’s press release of the Q3 results and related presentation materials)

I view Walmart’s results and comments as particularly noteworthy given their retail prominence and focus on low prices.  I have previously commented on their quarterly management call comments; these previous posts are found under the “paycheck to paycheck” tag.

Here are various excerpts that I find most notable:

comments from Doug McMillon, President and CEO, page 4:

Comp store sales grew 1.2 percent in Walmart U.S., driven by a traffic increase of 0.7 percent. Greg Foran, our U.S. leadership team and our associates continue to execute our plan to win, and it’s working. Our customer satisfaction scores continue to improve, and the team did a great job of managing the flow of inventory again this quarter. Comp store inventory was down approximately 6 percent and in-stock levels are up.

comments from Brett Biggs, EVP & CFO, page 8:

During this transformational time, a key priority remains using our financial strength to provide strong cash returns to shareholders in the form of dividends and share repurchases. In the quarter, we paid approximately $1.5 billion in dividends and repurchased 19.6 million shares for approximately $1.4 billion. Year-to-date, we have now returned $10.9 billion to shareholders. As of the end of the third quarter, we have utilized approximately $8.7 billion of the current $20 billion share repurchase authorization.

comments from Brett Biggs, EVP & CFO, page 9:

As a result, operating income declined 11.3 percent for the quarter. Excluding last year’s lease accounting adjustment, operating income would have declined 9.8 percent.

 

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2187.49 as this post is written

Walmart’s Q2 2017 Results – Comments

I found various notable items in Walmart’s Q2 2017 management call transcript (pdf) dated August 18, 2016.  (as well, there is Walmart’s press release of the Q2 results and related presentation materials)

I view Walmart’s results and comments as particularly noteworthy given their retail prominence and focus on low prices.  I have previously commented on their quarterly management call comments; these previous posts are found under the “paycheck to paycheck” tag.

Here are various excerpts that I find most notable:

comments from Doug McMillon, President and CEO, page 2:

We exceeded our Walmart U.S. comp sales guidance this quarter, with Walmart U.S. delivering comp sales of 1.6 percent, driven by a traffic increase of 1.2 percent. This was our 8th consecutive quarter of positive comp sales and our 7th consecutive quarter of positive traffic. I’m encouraged by what I’m seeing when I visit stores and pleased with how Greg Foran, our leadership team and our associates are executing our plan to win. Our customer satisfaction scores continue to improve, and the team did a great job of managing the flow of inventory again this quarter. Comp store inventory was down 6.5 percent and in-stock levels are up.

comments from Brett Biggs, EVP & CFO, page 9:

Gross margin increased 33 basis points in the quarter. Improved margin rates in food and consumables were a contributing factor. In addition, we had improvement in our cost of goods due to savings in procuring merchandise, lower transportation expense as a result of lower fuel costs and some improvements in shrink. These benefits are somewhat offset by the implementation of the multi-year strategy of incremental price investments.

comments from Brett Biggs, EVP & CFO, page 10:

Operating expenses increased 8.3 percent over last year due primarily to the previously announced associate wage rate increases and investments in technology. We remain focused on managing expenses with an EDLC mindset while elevating the shopping environment for customers. Overall, the SG&A increase was partially offset by improved gross margins, resulting in an operating income decline of 6.2 percent.

 

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2182.22 as this post is written

Walmart’s Q1 2017 Results – Comments

I found various notable items in Walmart’s Q1 2017 management call transcript (pdf) dated May 19, 2016.  (as well, there is Walmart’s press release of the Q1 results(pdf) and related presentation materials)

I view Walmart’s results and comments as particularly noteworthy given their retail prominence and focus on low prices.  I have previously commented on their quarterly management call comments; these previous posts are found under the “paycheck to paycheck” tag.

Here are various excerpts that I find most notable:

comments from Doug McMillon, President and CEO, page 3:

We delivered comp sales of 1 percent in Walmart U.S. due to continuing traffic increases, which improved 1.5 percent this quarter. This was our 7th consecutive quarter of positive comp sales, and our 6th consecutive quarter of positive comp traffic.

comments from Brett Biggs, EVP & CFO, page 9:

Gross margin improved 44 basis points in the quarter. We delivered improved margin rates in Food, Consumables and Health & Wellness as our continued focus on reducing costs both in how we operate the business and in procuring merchandise provided benefits. In addition, transportation costs benefited from lower fuel prices, we had some improvements in shrink, and we also lapped last year’s incremental expenses related to the west coast port congestion.

comments from Brett Biggs, EVP & CFO, page 10:

Finally, as we communicated in October, price investment is always an important part of our growth plan. We began the initial phase of additional price investment late in the first quarter, lowering prices on key items in select geographies. As always, we’re committed to providing quality merchandise at a great value, using data and analytics to better serve our customers.

 

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 2047.63 as this post is written