FAYETTEVILLE, Ark. — Few, if any companies, could put on such a big and bold extravaganza, especially in these times. The Wal-Mart annual shareholders’ meeting at the University of Arkansas’ Bud Walton Arena on Friday was equal parts self-congratulation, motivation and entertainment.
“Annual,” as the initiated call it, is a tradition. What’s more, Wal-Mart has much to crow about: global sales in fiscal 2009 of $401 billion and, on Thursday, the retailer said it will create 22,000 jobs, mainly in its U.S. stores.
“We have a story to tell, and we think it’s a good one,” said a Wal-Mart spokesman, adding that, “Annual gives the company the opportunity to tell it.
Ben Stiller, who was the meeting’s master of ceremonies, poked fun at the deeply ingrained Wal-Mart culture.
“Man, you guys like to get up early,” he said, referring to the event’s 7 a.m. start time. “I hear they’re still sleeping over at Target.”
Mike Duke, president and chief executive officer of Wal-Mart Stores Inc., presided over his first annual meeting; Duke succeeded Lee Scott, who retired in February. “Last fiscal year, earnings were up 6 percent to $3.35 per share,” he said. “We returned $7.3 billion to our shareholders. We closed the year with about $11.6 billion in free cash flow.”
Vice chairman Eduardo Castro-Wright noted that every month for five consecutive quarters, the company has reported better comparative growth than the market (although Wal-Mart recently decided to no longer report monthly comp-store sales, May being the first month it did not do so). “I believe we’ve achieved the best inventory flows, and our profits grew faster than sales last year,” he said.
After explaining that “Wal-Mart is not all about financial performance,” Castro-Wright showed the company’s fun side by introducing “the newest member of the Wal-Mart family” — the more musical half of the Miley Cyrus and Max Azria junior label that was unveiled on Wednesday. Wearing black cropped spandex leggings, a Union Jack T-shirt and black blazer with rhinestone collar, Cyrus, her long brown hair worn straight, looked more innocent than her alter ego, the glitzy Hannah Montana, as she sang her hit, “The Climb.”
Later, in an interview after the annual meeting, Dottie Mattison, senior vice president of women’s apparel, jewelry, shoes and accessories as well as product development, explained the Cyrus and Azria project “is a multicategory concept. The apparel part will be a casual junior line inspired by Miley’s rock ’n’ roll Tennessee roots.”
Mattison noted Wal-Mart carries another Azria brand, Maxrave, and said, “We’re very familiar with the [BCBG Max Azria] portfolio.”
“The overarching strategy is leveraging connections in the entertainment [world],” she said. Asked if Wal-Mart is embarking on this strategy mainly for juniors, Mattison said, “We sell a lot of media and music [influenced apparel] to a whole range of customers.”
Other performers at the annual meeting included Kris Allen, the winner of the most recent “American Idol”; Smokey Robinson, and Latin pop star Paula Rubino, whose performance preceded Doug McMillon, president and ceo of Wal-Mart International.
McMillon gave shout-outs to blocs of associates from Chile, Brazil, China and Japan who were flown to Arkansas. The international division opened 500 stores last year and added a new business, D&S, with 209 units in Chile.
All six of the shareholder proposals were defeated at the meeting, where the themes of diversity and inclusion were raised by several speakers. “We’ve developed a new diversity strategy to put more women and people of color in leadership positions,” said Castro-Wright. “We want to lay out clear career paths for our associates.”
At a question-and-answer session with the media immediately following the meeting, Duke predicted the customers Wal-Mart won over during the economic downturn will stay. “We clearly benefitted over the last six months from customers getting extra cash from lower prices. They’re buying discretionary purchases. We have been gaining traffic. Out of that growth, 17 percent can be identified as new customers. They’ll stay with us because they realize they can save money with us. When they have more disposable income, they’ll spend more with us.”
Sustainability, a pet issue of Scott’s, “is personal for me, as it was for Lee,” Duke said. “I believe we can and must have an economy that is greener. We’re going to focus and lead on sustainability.”
As for Project Impact, the store redesign initiative has led to 75 to 130 basis points of comp-store growth. “We expect to see better performance from those stores,” Castro-Wright said.
Some of the changes will come to the apparel pad. “We see opportunity for continued improvement,” Mattison said.
But Metro 7, once hyped as a major move into more fashionable collections by the discounter, is no longer a fixture in the stores. “We don’t carry that,” she said simply. “We’re always looking for opportunities to increase space and productivity” of successful brands. Op has a large display, this being the height of the swim season, and Wal-Mart has added exclusive collections from the likes of Norma Kamali and L.E.I. Although the George offering in a store here seemed limited, Mattison insisted, “We’re still happy with George.”