Wal-Mart second-quarter profit rises, international growth slows

(Reuters) - Wal-Mart Stores Inc's full-year profit may miss Wall Street expectations as growth slows in international markets, pressuring the world's largest retailer even as its U.S. discount stores continue to rebound in a tepid economy.

Wal-Mart, viewed as a barometer of economic activity, said Thursday it still sees signs customers are strapped - spending more at the beginning of the month, when they get their paychecks.

"The paycheck cycle remains pronounced, and there continues to be a lot of uncertainty in the global economy," Chief Financial Officer Charles Holley said in a recorded message.

Wal-Mart shares fell 2.3 percent to $72.75 in premarket trading.

Meanwhile, it reported higher second-quarter, but just topped estimates.

Sales at Walmart U.S. stores open at least a year, or same-store sales, rose 2.2 percent in the second quarter.

While the increase topped analysts' average estimate of a 2.1 percent rise, according to Thomson Reuters I/B/E/S, it was just a notch above the midpoint of the company's 1 percent to 3 percent forecast. The pace of growth slowed from a 2.6 percent rise in the first quarter.

"It seemed to be a decent quarter but there was not as much momentum as we thought there would be," said John Tomlinson, senior hardline retail analyst at ITG Investment Research. "People thought that the business was gaining some steam instead of taking maybe a hair of a step back."

The discount retailer has now posted four consecutive quarters of same-store sales growth at Walmart U.S., by far its largest unit.

Still, Wal-Mart's U.S. sales gains trailed results at smaller competitors. Target Corp said second-quarter same-store sales rose 3.1 percent.

Dollar Tree Inc said Thursday second-quarter same-store sales rose 4.5 percent, topping expectations.

BRIBERY INVESTIGATION COSTS EXPECTED

At Wal-Mart, same-store sales also rose at its international division and Sam's Club warehouse chain.

Chief Executive Mike Duke said international growth has slowed and that the company is cutting back spending on new stores in some emerging markets to focus on increasing sales at existing stores. The company is facing government probes into allegations of bribery at its Mexican unit.

Wal-Mart said it spent about $34 million on third-party advisers reviewing Foreign Corrupt Practices Act matters during the second quarter. It expects to incur an additional $35 million to $40 million in related costs in the third and fourth quarters, Holley said.

Wal-Mart earned $1.18 per share in the quarter, up from $1.09 per share a year earlier. Analysts, on average, expected $1.17 per share, according to Thomson Reuters I/B/E/S.

Consolidated net sales rose 4.5 percent to $113.53 billion.

Wal-Mart raised and narrowed its full-year earnings per share forecast. It now expects to earn $4.83 to $4.93 a share, versus a prior target of $4.72 to $4.92.

Analysts' average target was $4.93.

For the current third quarter, Wal-Mart forecast profit of $1.04 to $1.09 per share, up from 97 cents a year earlier. The analysts' average target was $1.05 per share.

The company forecast a 1 percent to 3 percent rise in Walmart U.S. same-store sales in the third quarter, compared with a 1.3 percent increase a year ago.

The third quarter of fiscal 2012 was the first time same-store sales grew at Walmart U.S. after nine consecutive quarterly declines.

(Reporting by Jessica Wohl in Chicago; editing by Jeffrey Benkoe)

Source: http://news.yahoo.com/wal-mart-profit-rises-helped-strength-u-stores-111002995--finance.html

levon helm firelight world peace elbow kevin love think like a man world peace world peace lakers