Wal-Mart Stores Inc., the world’s largest retailer, cut its annual profit forecast for the second time this year as the slow economic recovery and increased competition from dollar stores reflect on sales.
The group also offered a bleak outlook for the key holiday season, saying US sales in the period are likely to be “relatively flat”.
For the three months to 25 October, operating income was up 3.6%, to $6.3 billion, with sales growing by just 1.6% to $114.9 billion. However, in the US market, like-for-like sales declined by 0.3%.
Walmart said overall inflation in the US was “muted,” despite some growth in categories such as dairy, meat and produce. It said it was “pleased with the continued strength in produce and adult beverages, which delivered mid single-digit and high single-digit positive comps, respectively.”
Looking ahead, Wal-Mart stated, “For the fourth quarter, we expect EPS to range between $1.50 and $1.60. Our guidance includes the impact of approximately $0.10 per share for certain items."
