Walmart profits take hit, but earnings rise as online grows

A shopper loads her car after shopping at a Walmart in Pittsburgh. The company reported its earnings on Thursday, May 17, 2018. (AP Photo)
Updated 17 May 2018
0

Walmart profits take hit, but earnings rise as online grows

NEW YORK: US retail giant Walmart saw profits take a hit, but earnings beat analysts’ expectations and total sales rose amid the growth of online sales, according to results released Thursday.
Net income was down $905 million from the same period last year at $2.134 billion.
But the key earnings per share measure was $1.14, two cents higher than expected. And net sales, at $121.6 billion, were up 4.4 percent over the same period last year — more than $1 billion higher than expectations.
The decrease in net income is primarily due to a change in accounting policy related to Wal-Mart’s 2016 equity investment in Chinese online distributor JD.com, of which Wal-Mart holds a little more than 10 percent.
In its guidance, the company cautioned that the recent purchase of Indian online marketplace Flipkart announced earlier this month was expected to negatively impact earnings per share in the current fiscal year by $0.25 to $0.30 if the transaction closes at the end of the second quarter.
Wal-Mart, which is trying to compete with online giant Amazon, saw US comparable store sales rise 2.1 percent and customer traffic increase 0.8 percent, although the unseasonably cold weather hurt sales in the US.
US online sales surged 33 percent, while international sales jumped 4.5 percent.
“We are changing from within to be faster and more digital, while shaping our portfolio of businesses for the future,” Walmart chief Doug McMillon said in a statement.
Following the release, the company’s stock was up more than two percent in pre-market trading to $87.85.


Beijing to clamp down on property market irregularities as rents soar

Updated 17 August 2018
0

Beijing to clamp down on property market irregularities as rents soar

BEIJING: Beijing’s housing authority said on Friday it will clamp down on market irregularities that have fueled a spike in rental prices, telling major apartment rental service providers, including Ziroom, to correct their behavior.
In a statement on its website, the Beijing Municipal Commission of Housing and Urban-rural Development said it had held talks with major rental companies on Friday after media reports of surging rents.
Since last year, authorities have been looking favorably on real estate companies that have robust plans to develop their rental businesses as this fit with President Xi Jinping’s pledge to reduce the speculative nature of the property market and help provide affordable housing for those who can not afford to buy.
Policymakers have appealed to banks and insurers to facilitate funding and help accelerate the development of rental markets.
Rental companies are capitalizing on Beijing’s campaign to develop a viable urban rental market. In January, Ziroom — a variation on Airbnb — landed a fresh investment of about $620 million led by private equity firm Warburg Pincus.
The housing authority told the rental companies they should not grab rental listings with above market price offers using funds they procured from banks and other financial channels, which has fueled a “vicious competition.”
It also warned they should not tempt landlords to terminate leasing contracts early with promises of higher prices.
The bureau said it had launched a joint inspection with the Beijing banking regulator and the finance and tax bureaus on rental companies to crack down on such behavior that had rattled the market.