By Lisa Johnston
New products on display at the American International Toy Fair, held in N
Four top mass merchants reported quarterly earnings last week that were mixed, with Wal-Mart and Target having better performances than Home Depot and BJ's Wholesale.
Wal-Mart Stores reported higher net sales and income for its third quarter ended Oct. 31.
Net sales for the third quarter were $83.5 billion, an increase of 12 percent over the third quarter of the previous fiscal year. Income from continuing operations for the quarter was $2.6 billion, an increase of 7.1 percent from $2.4 billion from last year's third quarter
Lee Scott, Wal-Mart Stores president/CEO, commented, "There are real opportunities in the fourth quarter to build on the momentum of the aggressive pricing strategy we have implemented in our stores for the holiday season. This season, no one will doubt Wal-Mart's leadership on price and value." (See related story on p. 1.)
In the Wal-Mart Stores segment in the third quarter it had operating income of $3.6 billion, an increase of 9.9 percent, compared with $3.3 billion in the third quarter of fiscal 2006. In the Sam's Club segment during the third quarter operating income was $356 million, an increase of 4.1 percent, compared with $342 million in the third quarter of fiscal 2006.
Total U.S. comparable store sales for the quarter increased 1.5 percent, which is represented by a 1.5 percent increase for Wal-Mart Stores and a 1.8 percent increase for Sam's Club.
Target also reported higher net earnings and total revenues for its fiscal third quarter ended Oct. 29. Net earnings were $506 million compared with $435 million for last year's third quarter. Total revenues in the third quarter increased 11.2 percent to $13.6 billion from $12.2 billion in 2005, driven by the contribution from new store expansion, a 4.6 percent increase in comparable-store sales and the contribution from credit card operations.
Earnings before interest expense and income taxes (EBIT) in the third quarter increased 15 percent to $957 million, compared with $831 million in the third quarter a year ago.
Home Depot reported flat net earnings and an 11.3 percent increase in sales for its fiscal third quarter that ended Oct. 29. Net earnings of $1.5 billion were the same as last year's third quarter, while sales for in the quarter were $23.1 billion, an 11.3 percent increase from the same time last year.
Total sales in the retail segment grew 1.1 percent to $19.7 billion. Comparable store sales declined 5.1 percent in the third quarter. The U.S. retail home improvement market has slowed significantly due to a slowing overall economy, declining home prices and equity extraction, and slowing housing turnover, the chain said.
BJ's Wholesale Club reported lower net income and slightly higher sales for its fiscal third quarter ended Oct. 28. Net income for its third quarter slipped to $18.3 million compared to net income of $27.8 million versus last year. Net sales for the third quarter were approximately $2.0 billion, an increase of 2.9 percent over the third quarter of 2005.
This TWICE webinar, hosted by senior editor Alan Wolf, will take a look at what may be the hottest CE products at retail that will be sold during the all-important fourth quarter. Top technologies, market strategies and industry trends will be discussed with industry analysts and executives.