Wal-Mart shares rise despite earnings plunge

Wal-Mart Stores raised its full-year profit projection Thursday, sending share prices higher despite reporting a plunge in third-quarter earnings due to one-time costs.
The world’s biggest retailer continued its strong performance in the US market, where comparable store sales rose 2.7 percent.
But third-quarter earnings sank 42.4 percent to $1.7 billion due mainly to a loss connected to debt payments. The retailer also set aside up to $60 million for compliance programs related to foreign bribery probes.
Revenues rose 4.2 percent to $123.2 billion.
Wal-Mart raised its adjusted full-year earnings estimate to a range of $4.38 to $4.46 a share from $4.30 to $4.40 previously.
In a difficult retail environment, the company pointed to progress its efforts to attract more customers back to US stores through higher employee pay and closer attention to merchandise and store presentation. Comparable store traffic in the US rose 1.5 percent. Wal-Mart also has invested heavily in e-commerce initiatives, buying several online specialty retailers and upgrading its smartphone app and other systems. It said e-commerce net sales rose 50 percent.
“We have momentum, and it’s encouraging to see customers responding to our store and e-commerce initiatives,” Wal-Mart Chief Executive Doug McMillon said.
“We are leveraging our unique assets to save customers time and money and serve them in ways that are easy, fast, friendly and fun.”
Earnings in the latest quarter were hit by 29 cents a share due to payments for premiums required to retire higher-interest debt early.
Even so, the retailer’s share price gained 3.5 percent in pre-market trading to $93.00.

Source:Arabnews