BENTONVILLE, Ark. -- Wal-Mart Stores here said the company achieved record sales and earnings for the second quarter that ended July 31, though sales growth was stunted somewhat by the impact of rising fuel prices on consumer spending.
H. Lee Scott Jr., president and chief executive officer, said Wal-Mart missed its sales projections for the quarter "as our customer continues to be impacted by higher gas prices, and it is difficult to improve our expense leverage in the current environment."
Net income rose 5.8% to $2.8 billion for the quarter and 9.3% to $5.3 billion for the first half, while sales jumped 10.2% to $76.8 billion for the quarter and 9.8% to $147.7 billion for the half. Comparable-store sales in the U.S. rose 3.5% for the quarter (including 3.6% at discount stores, supercenters and Neighborhood Markets and 2.9% at Sam's Clubs) and 3.2% for the six-month period.
Thomas M. Schoewe, executive vice president and chief financial officer, said total sales in the Wal-Mart Stores division were up 10.4% for the quarter, with food sales at supercenters growing more than 17% and food comps rising in "the mid-single digits."
For the quarter, Schoewe said the cost to move freight from distribution centers to the stores "impacted operating profit by at least $30 million," and utility costs were up $100 million.
He said he expects high gas prices "to continue to impact a large portion of our customer base and pressure operating results."
Wal-Mart anticipates year-end earnings between $2.63 to $2.70 per share -- down from an earlier estimate of $2.70 to $2.74.