Wal-Mart Ends Monthly Same-Store Sales Report
May 25 2009
Retail Wrap >>

Wal-Mart is not the first retailer to decide against reporting monthly same-store sales numbers but being the biggest means it is going to get a lot of attention for doing so.

Tom Schoewe, executive vice president and chief financial officer for the company, explained the decision in a press release. "At the start of this fiscal year, Wal-Mart revised its approach to providing guidance for sales. We went from providing guidance for monthly sales to forecasting a guidance range for our U.S. businesses for the full 13-week period. Moving forward, we will no longer report monthly sales. We will provide comparable store sales results on a 13-week basis, along with guidance for the upcoming 13-week period. And, we will release this information during our scheduled quarterly earnings calls."

"Wal-Mart was built on a foundation that manages for long-term success," Mr. Schoewe added. "This decision aligns investors with the long-term view we take to build shareholder value. We feel this also will reduce the intra-period volatility related to events such as calendar shifts. Reporting sales quarterly also places us in line with most other large retailers."

While Wal-Mart laid out its rationale for the change, not everyone was happy with the decision. An opinion piece on TheStreet.com, referred to the decision as "yet another abuse of investors" by a large publicly traded company.

Peter Brown, vice chairman of consulting firm Kurt Salmon Associates, called Wal-Mart's decision "a loss of a very important indicator." He told Dow Jones, "They (Wal-Mart's monthly same-store numbers) are the best gauge of what is going on with general consumer spending in America."

Brian Sozzi, equity retail analyst at Wall Street Strategies, told Dow Jones, that Wal-Mart's move makes sense and he expects "others to start falling under the umbrella."

Mr. Sozzi said reduced reporting by Wal-Mart will make it more difficult for investors to get information on the company, "but a little extra footwork on investors' parts will help make up for it."

Adapted from source: www.retailwire.com, 8 May 2009