Walmart Sales Miss Expectations, Management Blames Delayed Tax Refund Checks And The Payroll Tax Hike
Walmart's Q1 financial results are out.
Earnings per share came in at $1.14 per share, which was right in line with expectations.
However, sales are looking weak.
Comparable store sales excluding fuel fell by 1.4%. Analysts were looking for a 0.1% decline.
"Comp sales performance was impacted by a delay in income tax refund checks, challenging weather conditions, less grocery inflation than expected and the payroll tax increase," said management. "Walmart U.S. gained market share in the measured category of "food, consumables and health & wellness/OTC."
"In a quarter marked by considerable headwinds to top line sales, Walmart delivered solid EPS growth of 4.6 percent," said CEO Mike Duke. "Walmart's mission is simple and focused -- to help people save money so they can live better. When we simplify and focus our execution against this mission, it's easy for our associates to prioritize what they have to do to serve our customers."
The stock is down slightly in pre-market trading.
"Given current business and economic trends, including currency, we expect second quarter EPS to be in the range of $1.22 to $1.27," said CFO Charles Holley. "Investments in Global eCommerce initiatives were forecast to have an incremental $0.09 impact for fiscal 2014, and this remains in our guidance. We expect the Q2 impact to be in line with the $0.02 per share we had in the first quarter. In addition to eCommerce initiatives, expenses related to FCPA matters are expected to range from $65 to $70 million for the second quarter."
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