LITTLE ROCK — Wal-Mart Stores Inc. is delivering on its pledge from a year ago to generate stronger sales in the U.S. and is gaining market share in almost every market in which it operates globally, company executives said Wednesday.
The U.S. operation is consistently increasing sales in stores open at least a year, a key measure of retail success, and is focused on maintaining that momentum to “give America the absolute best possible Christmas,” said Mike Duke, president and chief executive officer.
“This is the best leadership team that Wal-Mart has ever had, and I think it’s the best leadership team in all of business,” Duke said at the company’s annual investor conference at the John Q. Hammons Center in Rogers. The event was carried live via an online webcast.
Duke said the company generated $6 billion in new U.S. sales during the first half of the year. The company’s international business, he said, delivered a 17 percent increase in bottom-line sales.
“The world has the highest expectations of Wal-Mart everywhere we operate,” he said.
Those expectations apply not only to sales, he said, but to sustainability initiatives, compliance with laws and regulation, and for acting with integrity.
Shareholders, likewise, maintain high expectations for the company, he said.
Wal-Mart shares closed at $75.42 on Wednesday, up $1.28, or 1.7 percent. In intraday trading, the shares hit a 52-week high of $76.81.
Duke said the company has slowed its expansion in two key international markets, Brazil and China, to improve the quality of new stores, but will still add 21 million to 23 million square feet of new retail space in those markets, he said.
The company, Duke said, has successfully trimmed construction costs while still meeting its goals for expansion.
“Sam Walton taught us to watch every penny, and make every penny count,” he said. “We will only spend wisely, and those investments will be good for our shareholders.”
The late Sam Walton was the company’s founder.
Bill Simon, president of the company’s U.S. business, said the company is committed to offering the broadest assortment of merchandise at the lowest price.
“The strategy is working,” he said.
Simon noted that for the first half of the company’s fiscal year, sales were up 4.8 percent and operating income rose 6.6 percent. Those results were driven by a $2 billion “investment” in lower prices, he said.
“The effect has been exactly what we thought it would be,” he said.
Wal-Mart’s U.S. initiatives include links between its online and brick-and-mortar operations.
The company also is pursuing opportunities for its smaller-format stores, which include its Neighborhood Market grocery stores and the even smaller Wal-Mart Express.
Those formats, Simon said, give the company leverage in competing with dollar stores, drug stores and regional grocery chains.
Compared with dollar stores, he said, Wal-Mart has a broader assortment of products. And with drug stores, he said, Wal-Mart has an advantage with fresh produce, meat and even gasoline.
Against regional grocery chains, he said, Wal-Mart competes with a broad number of competitors.
The small format “gives us a flexibility we’re really excited about.”
Rosalind Brewer, president and chief executive of Sam’s Club, Wal-Mart’s wholesale club division, said the company has strengthened its member engagement with well-known brands and a broad fresh foods offering.
“It’s clear to us how important fresh is to our overall product category,” she said. “We know that this is a traffic grower. We know this is what our members want.”
On Wednesday morning about 100 representatives of OUR Walmart gathered in front of Wal-Mart headquarters in Bentonville, carrying signs and chanting slogans including “Health care not welfare” and “We’re on strike. We want to speak to Mike [Duke, the CEO].” Many wore lime green T-shirts with “How are the staffing levels at your store?” printed on the back.
OUR Walmart is funded by the United Food and Commercial Workers union. The union has tried, with little success, to organize bargaining units representing Wal-Mart workers.
Carlton Smith, a Wal-Mart employee for 16 years from Paramount, Calif., said the workers needed better wages, affordable health care, the ability to speak out without the threat of retaliation, and respect.
The group spoke with two Wal-Mart executives who walked out to meet them. An OUR Walmart spokesman said, “We need more hours. We cannot take care of our families.”
Vicky Dodson, senior director for labor relations at Wal-Mart, and David Scott, human resources vice president, said they’d be willing talk to any employee one-onone. The employees responded that they came as a group and would only speak as a group, and moved on.
Business, Pages 25 on 10/11/2012