BENTONVILLE, Ark. -- Supercenters are outdoing Wal-Mart's broader business on both the food and nonfood sides, the company said last week.
Wal-Mart Stores here said food sales at supercenters rose 36% during the third quarter ended Oct. 31 -- outpacing the company's overall sales growth of 21% for the quarter.
The company also said the growth in general-merchandise sales at supercenters exceeded the rate of growth in general-merchandise categories in its Wal-Mart discount stores, although it did not cite specific numbers.
In a telephone presentation last week, Jay Fitzsimmons, senior vice president of finance and treasurer, said comparable-store sales at supercenters were higher than at discount stores, which was notable, he said, because the higher volume in supercenters and the industry's lower food sales comps make it more difficult to achieve higher percentage comps in supercenters -- something he said Wal-Mart has been doing all year.
Fitzsimmons also said gross margins at supercenters improved in both food and general merchandise during the quarter, with food margins up 10 basis points for the period, "which is better than we originally projected when we started the format."
The company said third-quarter results included two months of sales and earnings from Asda, the United Kingdom-based retailer that Wal-Mart acquired earlier this year.
As a result of the Asda results, Wal-Mart said sales increased to record levels -- up 21% to $40.3 billion for the 13-week quarter and up 17% to $113.6 billion for the nine-month period -- while comparable sales rose 7% for the quarter and 8% for the year to date. The company said comps were up 7.4% at its Wal-Mart Stores segment for the quarter and 8.3% for the year to date, while comps rose 5.8% at Sam's Club warehouse stores for the quarter and 6.8% for the year to date.
The company said net income rose 29% to $1.3 billion, or 29 cents per share, for the quarter and 27% to $3.7 billion, or 82 cents per share, for the nine months -- marking the sixth consecutive quarter the company's net earnings have exceeded $1 billion.
According to David Glass, president and chief executive officer, "This solid performance resulted from a strong economy, improved gross margins attributable to good merchandising and to our dedicated associates and loyal customers."
He said Asda's results exceeded the company's financial plan, and its operations were accretive to Wal-Mart's earnings.
Glass said the company spent $4 billion on capital expenditures during the first nine months of the year, excluding $10.7 billion spent to acquire Asda. He said the total spending of close to $15 billion "reflects the continued acceleration of supercenters and efforts to build our distribution network."
It was "a very busy quarter" for supercenter openings, he added, with 60 units opened, including 20 new units averaging 180,000 square feet and 40 relocations or expansions averaging 192,000 square feet. Glass said the total square footage for supercenters at the end of the quarter was 124 million.
Discussing financial results on a segment basis, the company said:
In the Wal-Mart Stores segment, which includes 1,803 discount stores and 682 supercenters, sales rose 13.8% to $26.4 billion for the quarter and 17.9% to $77 billion for the year to date, while operating profit was up 14.6% to $1.9 billion for the quarter and 21% to $5.9 billion for the nine months.
In the 456-store Sam's Club segment, sales increased 7.6% to $6.0 billion for the quarter and 8.7% to $17.8 billion for the year to date, while operating profit rose 9% to $187 million for the quarter and 11% to $521 million for the year to date.
In the international segment, which includes 984 stores, sales jumped 99.6% to $5.9 billion for the quarter and 51.3% to $12.9 billion for the nine months, while operating profit rose 77.1% to $109 million for the quarter and 14% to $369 million for the nine-month period.
In the McLane Wholesale segment, sales rose 19.6% to $2.1 billion for the quarter and 24.6% to $6.0 billion for the year to date; the company did not break out operating profits for the McLane segment.
