Wal-Mart's April Comps Drop 3.5 Percent

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Wal-Mart's April Comps Drop 3.5 Percent

BENTONVILLE, Ark. -- Wal-Mart Stores, Inc. said yesterday its same-store sales in April declined 3.5 percent -- its worst monthly same-store sales results in at least 28 years, according to the Wall Street Journal. The retailer blamed this year's early Easter, along with challenging economic conditions for consumers, for the negative performance.

The 3.5 percent decline in same-store sales included a 4.6 percent decline at its U.S. division -- which includes supercenters, discount stores, and Neighborhood Markets -- and a 2 percent gain by its Sam's Club division.

For the four-week period ending May 4, 2007, Wal-Mart reported net sales at $26.57 billion, a 3.7 percent increase from the same period last year. International sales were up 13 percent, while sales in the U.S. division increased just 0.4 percent. Sales at Sam's Club increased 4.0 percent.

For the 13-week period ended May 7, Wal-Mart's net sales were up 8.1 percent, including a 5.5 percent increase in the U.S. division, a 5.9 percent increase at Sam's Club, and a 17.1 percent increase in international sales.

Sales at the Wal-Mart Stores segment for the April four-week period were effected negatively by weather conditions throughout most of the United States, the company said. An earlier Easter season this year also drove some seasonal sales into the March five-week reporting period.

Grocery continued to be stronger than general merchandise. Perishables such as bread, dairy, produce, and frozen foods were among the strengths in grocery the retailer said. Pharmacy sales, driven by the $4 generic prescription offerings, continued to perform well, Wal-Mart reported.

The product recalls by several manufacturers in the dog and cat food category contributed to a slowdown in pet supply sales during the April reporting period, Wal-Mart noted. The company is resuming shipments of selected pet food products this week and said it expects a turnaround in the category's sales by the end of May.

In Wal-Mart's monthly national survey among discount store consumers, concern about the rise in gas prices has increased steadily since January of this year. For March, the latest data available, the top three concerns among discount store consumers, as well as regular Wal-Mart shoppers, were money/income/finances, the cost of living, and gas prices.

Category strengths for Sam's Club in April included food, pharmacy, electronics, and home. As with Wal-Mart, seasonal categories were impacted negatively by cooler weather. Business member traffic and ticket continue to improve, highlighted by a strong performance in business- related categories during National Small Business Week.

The company expects comparable store sales in the U.S. for the May four-week reporting period to be 1 to 2 percent, said Tom Schoewe, e.v.p. and c.f.o. Comparable store sales for the second quarter of fiscal year 2008 are expected to be between 1 and 2 percent.