Wal-Mart June sales up; raises earnings forecast
NEW YORK (Reuters) - Wal-Mart Stores Inc on Thursday reported a 5.8 percent rise in June sales at U.S. stores open at least a year, beating Wall Street estimates, and the discount retailer raised its second-quarter earnings forecast.
Analysts, on average, had expected a same-store sales gain of 3.8 percent, according to Thomson Reuters Estimates, while the company itself had forecast a rise of 2 percent to 4 percent, excluding gasoline sales.
Wal-Mart's monthly sales have been outpacing those of competitors as shoppers head to its stores for discounts on food, health-care items and electronics.
Same-store sales rose 6.1 percent at its U.S. namesake discount stores and 4.6 percent at its Sam's Club warehouse division.
"The Wal-Mart U.S. underlying business remains strong," Chief Financial Officer Tom Schoewe said in a statement. "However, consumers and small business owners remain concerned about the economy, inflation and, most of all, higher gas prices."
The retailer said customer traffic at its discount stores rose in the month as shoppers received their U.S. government tax rebate checks. Sales were strongest in its grocery, entertainment and "health and wellness" businesses, which includes medicines.
BOOSTING SECOND-QUARTER FORECAST
Wal-Mart said it now expects second-quarter earnings per share of 82 cents to 84 cents due to "improved sales results during the quarter."
That is up from a forecast of 78 cents to 81 cents issued when the company reported first-quarter results in May. The original forecast was below Wall Street estimates, and Schoewe said Wal-Mart was being "appropriately conservative" given the volatile environment.
The retailer also said at the time that it was not sure how much of a sales boost it would get from the tax rebates.
But after issuing that forecast, Wal-Mart reported higher-than-expected May sales results and said shoppers had cashed about $350 million worth of tax rebate checks in its store, helping sales.
Wal-Mart said it expects July U.S. same-store sales, excluding gasoline, to rise between 2 percent and 4 percent.
It now expects second-quarter same-store sales to rise about 4 percent, up from a previous forecast for sales to be flat to up 2 percent.
(Reporting by Nicole Maestri, editing by Gerald E. McCormick and John Wallace)
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