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Walmex posts third-quarter revenue growth after earthquake sales boom
October 19, 2017 / 8:34 PM / in a month

Walmex posts third-quarter revenue growth after earthquake sales boom

MEXICO CITY (Reuters) - Mexican retailer Wal-Mart de Mexico (WALMEX.MX) on Thursday reported a 7.8 percent rise in third-quarter revenue, benefiting from earthquakes in Mexico last month that prompted shopping sprees for donations of supplies to displaced people.

A taxi driver waits outside a Wal-Mart store in Mexico City January 11, 2013. REUTERS/Edgard Garrido

Walmex’s quarterly revenue hit 136.8 billion pesos ($7.5 billion), compared with 126.9 billion in the same quarter last year, with Mexico sales climbing 8.9 percent and Central America sales rising 10.2 percent.

“People went out to make purchases at supermarkets to support earthquake victims, and I believe Walmex knew how to best capitalize on this,” Alejandra Marcos, an analyst with Mexican brokerage Intercam Casa de Bolsa, said before the results.

“I believe it’s going to be the best earnings report of the whole sector in Mexico.”

Walmex’s net profit of 8.7 billion pesos fell 13.7 percent from the same quarter last year but exceeded expectations of analysts surveyed by Reuters.

Walmex attributed the profit drop to the sale of clothing chain Suburbia to department store and shopping mall operator El Puerto de Liverpool.

Even as the Sept. 19 earthquake spurred shopping, Walmex said online sales grew at a lower rate than expected due to call center disruptions and a drop in orders in the quake’s aftermath.

Already the largest retailer in Mexico, Walmex said it expanded its Mexico and Central America footprint further in the third quarter with 33 new locations, bringing its total to 3,076 sites in six countries.

Walmex’s Sam’s Club locations saw the highest growth in same-store sales this quarter compared with the Walmart, Bodega and Superama formats, said the company, which is controlled by U.S.-based Wal-Mart Stores Inc (WMT.N).

The Mexican stock market closed on Thursday with Walmex shares trading at 43.1 pesos, down from the year’s high of 44.33 pesos in August.

Reporting by Daina Beth Solomon; Editing by Lisa Shumaker

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