Walmart sales rise 4.2% in U.S., 1.5% in Canada in 4th quarter
Walmart building e-commerce, holding its own in Canadian grocery market
Walmart defied a gloomy U.S. retail sales report for December, with sales up 4.2 per cent from a year earlier at its U.S. namesake stores in the fourth quarter.
Its fourth-quarter profits and sales beat Wall Street expectations with revenue of $138.8 billion US, an increase of $2.5 billion, or 1.9 per cent. Adjusted earnings per share increased to $1.41 per share, beating expectations of $1.33 per share.
Walmart does not break out its Canadian sales separately — they are rolled into its international division. But it said net sales in Canada increased 1.5 per cent in the fourth quarter compared to a year earlier.
Sales growth in Canada
Sales growth in Canada benefited from strength in grocery, consumables and health and wellness, partly offset by softer general merchandise sales, the company said.
Walmart has held its market share in the competitive grocery and health and wellness sector in Canada, it said. Increases in minimum wage, investments to accelerate e-commerce and store investments to improve the customer experience raised expenses.
Among its milestones in Fiscal 2019 in the Canadian market:
- Agreement to sell Walmart Canada Bank.
- Launched online marketplace in Canada.
- New partnerships to expand delivery options in grocery and general merchandise.
Walmart International had net sales of $32.3 billion, a 2.3 decline in part on currency fluctuations. In three of the largest markets — Canada, Mexico, the U.K. — there was strong growth, but in China sales declined, because of a calendar shift of the Mid-Autumn Festival and a slower economic environment.
The world's largest retailer enjoyed another quarter of surging e-commerce sales during the critical holiday period as it expanded its online assortment and services in the U.S. The report provides more evidence that Walmart's efforts to expand online grocery services, including curbside pickup and home delivery, are widening the gap between itself and rivals while at the same time helping it holding its own against online leader Amazon.
The U.S. Commerce Department last week presented a report showing very weak December retail sales.
But Walmart executives said Tuesday that its customers are benefiting from a stronger economy, lower gas prices and falling wages. The company also said that its business got a boost from the government issuing February checks to Supplementary Nutrition Assistance Program recipients early after the government shutdown.
"The consumer still feels pretty good," Brett Biggs, Walmart's chief financial officer told analysts on an earnings call Tuesday. "A number of things are still working. We are watching, making sure that we are in the right place with the customer. No matter the environment, we are able to react."