1 a service strategic preview: q2 may - august 2012 13 august 2012 natalie berg global research...
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1.Expectations for the Quarter 2.US: Q2 Strategic Changes 3.Global: Q2 Strategic Changes 4.Outlook 5.What’s new at Planet Retail Strategic Preview: Walmart Q2TRANSCRIPT
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1A Service
Strategic Preview: Q2May - August 2012
13 August 2012NATALIE BERG
Global Research Director
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Analyst Comment:
Strategic Preview: Walmart Q2
“We’re expecting another solid quarter with further signs of a domestic recovery bolstered by strong growth from overseas. Despite setbacks in Mexico and South Africa, Walmart International remains the company’s growth engine and we are anticipating strong numbers coming from the UK and Latin America in particular.
A continuation of the positive comp trend in the US is also to be expected, which would mark four consecutive quarters of comparable sales growth and indicate stability in Walmart’s domestic strategy. That said, we remain doubtful over the longevity of Walmart’s back-to-basics approach. Low prices are no longer a USP, but an expectation from shoppers. The recent closure of an Express store indicates that the format, despite being profitable, is a long way from perfection. Walmart needs to accelerate its multi-channel initiatives in order to sustain the current positive momentum.”
NATALIE BERGGlobal Research Director
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1. Expectations for the Quarter
2. US: Q2 Strategic Changes
3. Global: Q2 Strategic Changes
4. Outlook
5. What’s new at Planet Retail
Strategic Preview: Walmart Q2
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We are expecting a continuation of the positive comp trend.
1. Expectations for the Quarter
Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010 Q2 2010 Q3 2010 Q4 2010 Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012
-2.0
-1.0
0.0
1.0
2.0
3.0
4.0Walmart US: Like-for-Like Sales by Quarter, 2009-2012 (%)
Com
para
ble
Stor
e Sa
les (
%)
Note: Includes Sam’s Club, excludes fuel.Source: Planet Retail
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Expecting more signs of improvement in the US – a fourth consecutive quarter of positive comps will indicate stability in domestic strategy.
Will be looking out for any signs of small-box failing as well as any progress with online initiatives.
Internationally, we foresee another solid quarter with strong growth expected from Latam and UK.
We will be looking for an update on South Africa integration, success (?) of global EDLP implementation, signs of small-box halting in emerging markets.
Overall, we remain confident in Walmart’s ability to continue its short-term US turnaround but fear that they are losing their USP for long-term, sustainable growth.
Another solid quarter expected but doubts over long-term strategy.
1. Expectations for the Quarter