10-QPeriod: Q1 FY2014

Walmart Inc. Quarterly Report for Q1 Ended Apr 30, 2013

Filed June 7, 2013For Securities:WMT

Summary

Walmart Inc.'s first quarter fiscal year 2014 report (ending April 30, 2013) shows modest top-line growth, with total revenues increasing by 1.0% to $114.19 billion. While net sales saw a similar 1.0% increase, this was impacted by negative comparable sales across the company and foreign currency headwinds. However, the company demonstrated strong operational execution, with operating income growing slightly faster than net sales (1.1% increase). Diluted earnings per share (EPS) rose to $1.14 from $1.09 in the prior year period, reflecting solid profitability. Significant capital allocation activities are highlighted, including substantial share repurchases totaling $2.25 billion and an 18% increase in the annual dividend to $1.88 per share. The company also issued $5.0 billion in new long-term debt. While overall sales growth was modest, the financial performance indicates continued profitability and a commitment to returning capital to shareholders. Investors should note the ongoing legal and regulatory investigations, particularly the FCPA matters, which contributed $73 million to operating expenses during the quarter but are not currently expected to be material to the company's financial condition.

Financial Highlights

48 data points
Beta

Revenue

$114.07B

24.6% Gross Margin

Net Income

$3.78B

3.3% Net Margin

EPS (Diluted)

$0.38

Total Assets

$202.19B

Cash & Equivalents

$8.86B

Free Cash Flow

$1.93B

Financial Statements
Beta
Revenue$114.07B
Cost of Revenue$85.99B
Gross Profit$28.08B
SG&A Expenses$21.64B
Operating Income$6.44B
Interest Expense$507.00M
Net Income$3.78B
EPS (Basic)$0.38
EPS (Diluted)$0.38
Shares Outstanding (Basic)9.90B
Shares Outstanding (Diluted)9.95B

Key Highlights

  • 1Total revenues increased by 1.0% to $114.19 billion for the three months ended April 30, 2013.
  • 2Diluted EPS rose to $1.14 from $1.09 in the prior year's comparable period.
  • 3Operating income grew by 1.1% to $6.46 billion, outpacing net sales growth.
  • 4The company repurchased $2.25 billion of its own stock during the quarter.
  • 5Walmart announced an 18% increase in its annual dividend to $1.88 per share.
  • 6The company issued $5.0 billion in new long-term debt.
  • 7FCPA-related investigations and global review costs amounted to $73 million, impacting operating expenses.

Frequently Asked Questions

For the three months ended April 30, 2013, Walmart reported total revenues of $114.19 billion, a 1.0% increase compared to the prior year. Consolidated net income was $3.95 billion, a slight increase from $3.89 billion in the same period last year. Diluted earnings per share attributable to Walmart increased to $1.14 from $1.09.

Walmart actively managed its capital by repurchasing $2.25 billion of its common stock and declaring dividends totaling $1.88 per share for fiscal year 2014, an 18% increase. The company also issued $5.0 billion in new long-term debt during the quarter. Despite these activities, the company maintained a strong liquidity position with $8.86 billion in cash and cash equivalents.

Yes, Walmart is undergoing investigations related to the Foreign Corrupt Practices Act (FCPA), which resulted in $73 million of expenses during the quarter related to the investigations, global review, program enhancements, and organizational changes. While management does not currently believe these matters will have a material adverse effect, they are ongoing and could lead to future consequences.

Walmart U.S. net sales increased by 0.3% despite a 1.9% decline in comparable store sales, impacted by reduced income tax refunds and a higher payroll tax rate. Walmart International net sales grew by 2.9%, largely driven by store growth and acquisitions, though negatively affected by currency fluctuations. Sam's Club net sales saw a modest 0.1% increase, with comparable club sales slightly down, influenced by fuel price volatility and weather.