Wal-Mart Stores Inc. demonstrated the importance of price on Tuesday when it posted fourth-quarter profits that beat expectations and sales that were its highest ever.
The retailer said net profits for the three months ended Jan. 31 dropped 7.4 percent to $3.8 billion, or 96 cents a diluted share, from $4.1 billion, or $1.02 a diluted share, a year earlier, but the numbers beat the company’s previously lowered forecast. Last month, Wal-Mart reduced its profit estimates for the quarter to a range of 91 cents to 94 cents a share from the $1.03 to $1.07 previously expected. Revenues for the quarter inched up 1.7 percent to a record-breaking $109.1 billion from $107.3 billion.
“Our performance relative to competitors was exceptionally strong in the fourth quarter and throughout the year,” said Mike Duke, the firm’s president and chief executive officer, during an earnings call. “We expect this momentum to continue. We’ve built strong momentum during the past year in a very tough economy. We will take what has worked for us and work hard at doing it even better.”
Net sales for the fourth quarter were $108 billion, an increase of 1.7 percent from $106.2 billion in the previous year’s fourth quarter. Income from continuing operations for the quarter was $3.8 billion, a decrease of 7.7 percent from $4.1 billion in the fourth quarter last year. The retailer paid $255 million to settle 63 class action wage and hour lawsuits.
Wal-Mart’s earnings for the full year rose 5.3 percent to $13.4 billion, or $3.39 a diluted share, on a 7.2 percent increase in revenues to $405.6 billion.
Looking forward, the company projected earnings of 72 to 77 cents a share for the first quarter and $3.45 to $3.60 for the current fiscal year.
“Wal-Mart is a clear out-performer in a challenging economy, benefiting not just from its price-value leadership, but also its upgraded soft-goods strategy that has infused the store with more compelling branded apparel names such as Norma Kamali, Ocean Pacific (Op), L.E.I., Danskin and Starter,” said Todd Slater, a retail, apparel and footwear analyst at Lazard Capital Markets.
Bill Dreher, a retail analyst at Deutsche Bank, said Wal-Mart will be a beneficiary of brands migrating out of department stores. “Right now the company is laying the groundwork for the improvement of the economy [when it will] be able to focus on greater merchandise clarity, more intuitive store planagrams as well as price leadership and cost reduction. Clearly, the apparel and home and other discretionary categories are being structured correctly. Dottie [Mattison, senior vice president over women’s apparel, jewelry, shoes and accessories as well as product development,] seems to be doing a great job of transitioning that department out of Arkansas and into New York. They will be able to transition the consumer to move across the aisle” when the economy improves.
As one of the most recognizable models in the world, Christy Turlington Burns has an insider’s view of the fashion industry and the allegations of sexual harassment swirling around it. “I can say that harassment and mistreatment have always been widely known and tolerated in the industry. The industry is surrounded by predators who thrive on the constant rejection and loneliness so many of us have experiences at some point in our careers,” Turlington told WWD, along with her suggestions for how the modeling world should protect younger women and men. Read more on WWD.com. Link in bio. (📷: Tony Palmieri) #wwdnews
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24-year-old Jean Prounis is redefining the rules of jewelry. Formerly a studio assistant to Jemima Kirke and a design apprentice at Ghuran, she focuses on handcrafted subtleties and ancient goldsmithing techniques. “There was a really sterile feel in the environment and I wanted to have jewelry with character that shapes how you wear it everyday,” Prounis said. Each piece is hand made in New York, either by Prounis or three other jewelers in the district. #wwdfashion
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“Stranger Things” is getting a new cast member for season 2. Meet @sadiesink_, the 15-year-old who will be joining the Netflix series for its new season. You may recognize her from “The Glass Castle” with Brie Larson and Woody Harrelson, but the Texas native’s next role goes in an entirely different direction. She describes her character, Max, as “a rough and tumble skater girl [who] becomes friends with the boys at school.” The second season debuts on October 27. (📷: @jgreenery) #wwdeye
Amid the Harvey Weinstein controversy, there’s another sector that’s being put under the spotlight for sexual abuse: the modeling industry. While rumors about abuse and sexual harassment of female and male models — and the photographers, agents and others who perpetrated it — have circulated within the fashion world for years, model @cameronrussell started posting stories from models on Instagram last week about abusive situations they’ve encountered — from sexual harassment and molestation to attempted rape. Over 75 have weighed in so far. Read more on WWD.com. Link in bio. #wwdnews
To celebrate its 16th anniversary, @dylanscandybar tapped designers and celebrities to create mosaics out of candy. The mosaics will be auctioned off to support the philanthropic cause of each participant’s choice. Pictured here is the mural created by @aliceandolivia's Stacey Bendet. For a first look at some of the other artwork being unveiled tonight, go to WWD.com. #wwdeye
The annual Veuve Clicquot Polo Classic in Pacific Palisades this weekend drew Kate Hudson, Tracee Ellis Ross, Laura Dern and more. See pictures of the star-studded event on WWD.com. (📷: @chelsealaurenla) #wwdeye
In his new book “Hollywood Royale,” Andy Warhol’s Protégé Matthew Rolston celebrates the Eighties revival of Hollywood glamour. Featuring more than 100 portraits taken by Rolston from 1977 to 1993, the book contains photos of icons like Michael Jackson, Cyndi Lauper, and @drewbarrymore, pictured here in 1991. “Hollywood Royale,” out today, will be accompanied by an exhibition opening at Los Angeles’ Fahey/Klein Gallery on March 1. #wwdeye