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Retail

Wal-Mart Sees 2016 Revenue Rise 3% To $133.6bn

American retail giant Wal-Mart Stores, Inc. announced that its total revenue for Q4 had increased by 3%, to $133.6 billion, excluding currency fluctuations.

Its US sales increased by 1.8%, encouraged by an increase in footfall of 1.4%, compared to the fourth quarter in 2015.

E-commerce was the big winner in 2016, as sales and gross merchandise volume from Jet.com and online grocery rose 29% and 36.1%, respectively.

Wal-Mart's international net sales fell by 5.1%, to $31 billion, including currency fluctuations. If these deviations weren't taken into account, revenue for its international segment would have reached $33.7 billion, an increase of 3.0%.

The Decline Of Asda

UK subsidiary Asda posted a sales decline of 2.9% for the fourth quarter of the year.

Shopper numbers fell by 1.8% for the period ending 27 January, while basket size was down 1.1%. Net sales were down 0.6%, with decreases in gross profit rate and operating income.

However, American subsidiary Sam's Club saw its net sales grow by 3%, to $14.98 billion.

“We're moving with speed to become more of a digital enterprise and better serve customers. We had a very solid fourth quarter, with US comp sales growth of 1.8% and US e-commerce GMV growth of 36%.

"Our international business is consistently delivering solid sales growth in constant currency, and Sam's Club posted its best comp sales growth of the year," commented Doug McMillon, president and CEO of Wal-Mart Stores, Inc.

'A Firmer Grip'

Neil Saunders, managing director of research firm GlobalData Retail, commented on the results, saying, "As much as positive things are happening in the domestic market, we remain concerned about Walmart’s performance overseas, especially in the UK.

"It is evident that Walmart must get a firmer grip on this part of its business. Investments in price, simplification of the proposition, and improving store environments and customer service are all necessary steps, but, again, necessary steps that come with a cost attached.

"Overall, we remain positive about Walmart. It is a sound business that, despite its size and scale, operates in a very entrepreneurial way. However, the year ahead is one of reinvention and investment, and not of profit maximisation. We believe this is the right strategy for continued long-term dominance."

© 2017 European Supermarket Magazine – your source for the latest retail news. Article by Karen Henderson. Click subscribe to sign up to ESM: The European Supermarket Magazine.

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