Wal-Mart Stores Inc. posted a larger-than-expected rise in quarterly profit on Thursday, as a lower-than-anticipated tax rate helped to overcome some weakness in sales at its major Walmart U.S. unit that persisted into the beginning of February.
The world’s largest retailer also raised its dividend payout.
Wal-Mart earned $1.67 per share from continuing operations in the fiscal fourth quarter, up from $1.51 per share a year earlier. Wal-Mart had forecast a profit of $1.53 to $1.58 per share from continuing operations, and analysts expected it to earn $1.57 per share, according to Thomson Reuters I/B/E/S.
Walmart U.S. has had a slow start to February, which Walmart U.S. chief executive officer Bill Simon attributed largely to a delay in income tax refunds. The company expects sales at Walmart U.S. stores open at least a year, or same-store sales, to be about flat during the current first quarter. A year earlier, such sales rose 2.6 per cent.
Efforts such as extending its layaway program and matching competitors’ prices attracted shoppers during the competitive holiday season, but Walmart U.S. same-store sales rose just 1 per cent in the fourth quarter. The company had forecast an increase of 1 per cent to 3 per cent, and analysts, on average, had looked for a 1.5 per cent gain.
A year earlier, Walmart U.S. same-store sales rose 1.5 per cent.
Still, Wal-Mart said that its biggest unit gained market share in major categories of food, consumables, health and wellness and over-the-counter medications, as well as in entertainment and toys, which are big sellers during the holiday period, citing data from Nielsen and the NPD Group.