Originally created 02/22/06

Sales boom on ad blitz

Wal-Mart Stores Inc., the world's largest retailer, said Tuesday that its fourth-quarter earnings rose 13.4 percent after aggressive holiday advertising helped boost sales by 8.6 percent.

But Wal-Mart shares slipped as the retailer's fourth-quarter revenue fell short of Wall Street projections, and it also forecast a profit outlook that is below Wall Street projections.

Net income rose to $3.6 billion, or 86 cents per share, for the quarter ended Jan. 31 from $3.2 billion, or 75 cents per share, a year ago.

Earnings in the latest quarter included a $103 million net tax benefit that boosted net income by 2 cents per share.

The Bentonville, Ark.-based retailer last month said it expected earnings at the low end of a range of 82 to 86 cents per share. Analysts surveyed by Thomson Financial had projected earnings of 83 cents per share.

Wal-Mart reported total fourth-quarter net sales of $89.3 billion and total revenue of $90.1 billion. Analysts expected revenue of $90.4 billion.

In the Wal-Mart division, which includes discount stores, Supercenters and Neighborhood Market grocery stores, sales were up 8.6 percent to $60.2 billion in the quarter. Sales at Sam's Club warehouse stores rose 6.8 percent to $10.65 billion, and the international division posted a sales increase of 9.6 percent to $18.4 billion.

Wal-Mart said it is optimistic about the current fiscal year because of efforts it launched last year to offer trendier products in competition with smaller rival Target Corp. Wal-Mart hopes new merchandise and a revamped store interior will get people who are already in its stores for basics to spend more money on other products.

"We want customers to shop Wal-Mart for all their needs, from consumables to electronics, home decor and apparel," Wal-Mart Chief Executive Officer Lee Scott said in a statement.

As part of the strategy, Wal-Mart has previously announced it will remodel 1,800 of its nearly 3,200 U.S. stores in the next 18 months to give them a more open, inviting look and improve the shopping experience.

Court Denies Status

MADISON, Wis. - A state appeals court on Tuesday denied class-action status to a lawsuit brought by Wal-Mart Stores Inc. employees who claimed they were forced to work through breaks.The lawsuit, originally filed in 2001, sought compensation on behalf of tens of thousands of current and former Wal-Mart employees in Wisconsin for working through meals and rest breaks.Similar cases have been filed across the country with varied success.

- Associated Press


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