Wal-Mart to shutter 269 stores; Canadian stores unaffected

NEW YORK -- Wal-Mart is closing 269 stores, more than half of them in the U.S. and another big chunk in its challenging Brazilian market.

See Full Article

The stores being shuttered account for a fraction of the company's 11,000 stores worldwide and less than 1 per cent of its global revenue.

More than 95 per cent of the stores set to be closed in the U.S. are within 10 miles of another Wal-Mart. The Bentonville, Arkansas, company said it is working to ensure that workers are placed in nearby locations.

The store closures will start at the end of the month.

The announcement comes three months after Wal-Mart Stores Inc. CEO Doug McMillon told investors that the world's largest retailer would review its fleet of stores with the goal of becoming more nimble in the face of increased competition from all fronts, including from online rival Amazon.com.

"Actively managing our portfolio of assets is essential to maintaining a healthy business," McMillon said in a statement. "Closing stores is never an easy decision. But it is necessary to keep the company strong and positioned for the future."

Wal-Mart operates 4,500 in the U.S. Its global workforce is 2.2 million, 1.4 million in the U.S. alone.

Wal-Mart has warned that its earnings for the fiscal year starting next month will be down as much as 12 per cent as it invests further in online operations and pours money into improving customers' experience.

Of the closures announced Friday, 154 locations will be in the U.S., including the company's 102 smallest-format stores called Wal-Mart Express, which were opened as a test in 2011.

Wal-Mart Express marked the retailer's first entry into the convenience store arena. The stores are about 12,000 square feet and sell essentials like toothpaste. But the concept never caught on as the stores served the same purpose as Wal-Mart's larger Neighborhood Markets: fill-in trips and prescription pickups.

Also covered in the closures are 23 Neighborhood Markets, 12 supercenters, seven stores in Puerto Rico, six discount stores and four Sam's Clubs.

Wal-Mart will now focus in the U.S. on supercenters, Neighborhood Markets, the e-commerce business and pickup services for shoppers.

The retailer is closing 60 loss-making locations in Brazil, which account for 5 per cent of sales in that market. Wal-Mart, which operated 558 stores in Brazil before the closures, has struggled as the economy there has soured. Its Every Day Low price strategy has also not been able to break against heavy promotions from key rivals.

The remaining 55 stores are spread elsewhere in Latin America.

Wal-Mart said that it's still sticking to its plan announced last year to open 50 to 60 supercenters, 85 to 95 Neighborhood Markets and 7 to 10 Sam's Clubs in the U.S. during the fiscal year that begins Feb. 1. Outside the U.S., Wal-Mart plans to open 200 to 240 stores.

The financial impact of the closures is expected to be 20 cents to 22 cents per diluted earnings per share from continuing operations with about 19 cents to 20 cents expected to affect the current fourth quarter. The company is expected to release fourth quarter and full year results on Feb. 18.

Shares of Wal-Mart Stores Inc. fell $1.12, or 1.7 per cent, to 61.94 in morning trading.



Advertisements

Latest Economic News

  • CIBC kicks off bank earnings week with 25% profit rise

    Economic CBC News
    CIBC reported better-than-expected results for its second quarter with a nearly 25 per cent increase in net income compared with a year ago. The lender reported a profit attributable to common shareholders of $1.29 billion or $2.89 per diluted share for the quarter ended April 30, up from $1.04 billion or $2.59 per diluted share a year ago. Source
  • Notley slams B.C. premier on Trans Mountain pipeline

    Economic CTV News
    EDMONTON -- Alberta Premier Rachel Notley won't be at today's meeting of the western premiers in Yellowknife, but she made some choice remarks about one of the leaders who will be there. Notley told reporters yesterday that B.C. Source
  • Bulgaria runs into setback in bid for euro membership

    Economic CTV News
    Russian President Vladimir Putin, right, shakes hands with Bulgarian President Rumen Radev after their talks in the Bocharov Ruchei residence in the Black Sea resort of in Sochi, Russia, Tuesday, May 22, 2018. (AP Photo/Alexander Zemlianichenko) Source
  • CIBC reports second-quarter net income up nearly 25 per cent from year ago

    Economic CTV News
    TORONTO -- The Canadian Imperial Bank of Commerce reported better-than-expected earnings for its second quarter with a nearly 25 per cent increase in net income, year over year, due to strong results at home and south of the border helped by its U.S. Source
  • No suitors emerge for Trans Mountain pipeline project stake as deadline looms

    Economic CTV News
    CALGARY - With just over a week remaining until the May 31 deadline set for abandoning its Trans Mountain pipeline expansion, no suitors have publicly emerged to step into builder Kinder Morgan Canada Ltd.'s shoes. Source
  • Looking for a better work experience, millennials may be saving the franchising model

    Economic CBC News
    Millennials are showing increasing interest in a traditional sector of the economy, as young Canadians buy into franchise brands and create new franchise concepts. Though jobs numbers in Canada are generally improving, many millennials continue to face the prospect of precarious employment. Source
  • They've been accused of killing every other business, but millennials may be saving the franchising model

    Economic CBC News
    Millennials are showing increasing interest in a traditional sector of the economy, as young Canadians buy into franchise brands and create new franchise concepts. Though jobs numbers in Canada are generally improving, many millennials continue to face the prospect of precarious employment. Source
  • Tens of thousands of Las Vegas casino workers vote to strike

    Economic CTV News
    Las Vegas casinos could watch tens of thousands of employees walk off the job for the first time in more than three decades after union members voted to authorize a strike at any time starting June 1, a move that could cripple the city's world-famous resorts. Source
  • Asian shares drop amid worries over U.S.-China trade

    Economic CTV News
    TOKYO - Asian indexes were mostly lower on Wednesday as investors shifted their attention to uncertainties over a planned U.S.-North Korea summit after the perk from eased U.S.-China trade tensions faded. KEEPING SCORE: Japan's benchmark Nikkei 225 dipped 1.3 per cent to 22,661.88, while Australia's S&P/ASX 200 inched down nearly 0.2 per cent at 6,031.40 in early trading. Source
  • Global stocks fall amid weak data, worries over Koreas

    Economic CTV News
    TOKYO -- Stock markets were mostly lower Wednesday after weak European economic data and as U.S. President Donald Trump raised doubts that a summit with North Korean leader Kim Jong Un planned for June 12 will take place as planned. Source