Wal-Mart de Mexico Profit Beats Expectations
Wal-Mart de Mexico SAB said Thursday that its net profit from continuing operations grew by almost a fifth in the third quarter thanks to higher sales and measures to contain costs.
Walmex, as the Mexico and Central America unit of Bentonville, Arkansas-based Wal-Mart Stores Inc. is known, reported net profit from continuing operations of 8.0 billion Mexican pesos ($425 million) for the July-September period, up 19.5% from a year before.
Quarterly profit fell 13.7% to 8.68 billion pesos, however, when including the 3.36 billion pesos registered a year ago in relation to the sale of the Suburbia clothing store chain, which Walmex closed in the second quarter of this year.
Sales grew 7.8% from the third quarter of 2016 to 136.79 billion pesos, while operating cash flow measured by earnings before interest, taxes, depreciation and amortization grew 13.3% to 13.36 billion pesos.
The results were above the expectations of analysts polled by The Wall Street Journal, which saw net profit of 6.93 billion pesos on sales of 136.8 billion pesos, and Ebitda of 12.73 billion pesos.
Same-store sales, which only include stores that have been open for at least one year, grew 7.2% in Mexico and 6% in Central America.
Growth has been consistent across countries and regions within Mexico, Walmex Chief Executive Guilherme Loureiro said in a prepared webcast. The company opened 33 stores in the third quarter, with new stores contributing 2.4% of sales growth.
Online sales accounted for 0.7% of the company's total sales, and contributed just 0.1% to sales growth in the quarter. While purchases of emergency and relief supplies following the deadly Sept. 19 earthquake in central Mexico helped lift store sales that month, e-commerce was negatively affected by the impact on call centers and digital traffic, he added.
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(END) Dow Jones Newswires
October 19, 2017 17:54 ET (21:54 GMT)