Wal-Mart de Mexico Profit Rises 23% in Fourth Quarter -- Update
16 February 2017 - 10:49AM
Dow Jones News
By Anthony Harrup
MEXICO CITY -- Net profit at Wal-Mart de Mexico SAB rose 23% in
the fourth quarter on higher sales and cost control efforts.
Mexico's biggest retailer, which also runs stores in Central
America, on Wednesday reported net profit for the October-December
quarter of 10.4 billion Mexican pesos ($514 million), compared with
8.5 billion pesos a year earlier.
Revenue increased 12% to 157.5 billion pesos and earnings before
interest, taxes, depreciation and amortization, or Ebitda, a
measure of operating cash flow, climbed 21% to 15.5 billion
pesos.
Costs and expenses grew less than sales in Mexico, contributing
to higher profit margins.
The quarter closed a solid year for Walmex, as the unit of
Bentonville, Arkansas-based Wal-Mart Stores Inc. is known.
Full-year sales grew 12% from 2015, thanks to strong household
consumption in Mexico, where employment and wage growth were
coupled with low inflation, and to gains in Central American
currencies against the Mexican peso.
In constant currency terms, fourth-quarter sales rose 8.9% in
Mexico and 9% in Central America. Same-store sales, excluding
stores opened in the past year, rose 7.9% in Mexico and 5% in
Central America.
An increase in remittances from Mexicans living abroad helped
results in Mexico, although Walmex also gained market share from
its main competitors with higher growth than that reported by
retail association Antad, of which Walmex is a member, said Chief
Executive Guilherme Loureiro in a webcast presentation.
"We continue to see consistent and sustainable growth in all the
countries where we operate," he said.
The results were roughly in line with the median estimates of
analysts polled by The Wall Street Journal, which called for net
profit of 10 billion pesos on sales of 157.5 billion pesos and
Ebitda of 15.8 billion pesos.
Walmex shares traded on the Mexican stock exchange slipped 0.1%
to 39.55 pesos before the release of the earnings.
The company said it plans to pay dividends this year equivalent
to 2.50 pesos per share, including 0.96 pesos per share related to
the pending sale of its Suburbia clothing store chain.
Write to Anthony Harrup at anthony.harrup@wsj.com
(END) Dow Jones Newswires
February 15, 2017 18:34 ET (23:34 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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