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Walmart US - Walmart.com
Walmart U.S. Wal-Mart Stores, Inc. (NYSE: WMT) 18th Annual Meeting for the Investment Community Bill Simon President & CEO, Walmart U.S. 1 Wal-Mart Stores, Inc. (NYSE: WMT) Today’s speakers Johnnie Dobbs EVP Logistics Duncan Mac Naughton EVP CMO 2 Wal-Mart Stores, Inc. (NYSE: WMT) Joel Anderson Karen Roberts President Walmart.com EVP & President Realty U.S. business review +75-100 bps sales1 • Implementing our strategy Assortment initiatives • Confidence in our plan 1 Average 2 Comp contribution to comp sales over the last 3 months improvement calculated Q3 YTD vs. Q1FY12 Note: All bps references are on the 4-5-4 calendar 3 Wal-Mart Stores, Inc. (NYSE: WMT) +100 bps traffic2 Food traffic improvement Walmart U.S. strategic growth plan 4 1 Price investment through productivity improvements 2 Merchandising improvements 3 Multi-channel strategy that leverages existing assets 4 Market share-driven real estate strategy Wal-Mart Stores, Inc. (NYSE: WMT) Walmart business model 5 EDLP EDLC Broadest assortment Everyday low prices across the box Operating at the lowest cost possible Delivering one-stop shopping Wal-Mart Stores, Inc. (NYSE: WMT) Walmart U.S. strategic growth plan 6 1 Price investment through productivity improvements 2 Merchandising improvements 3 Multi-channel strategy that leverages existing assets 4 Market share-driven real estate strategy Wal-Mart Stores, Inc. (NYSE: WMT) Gross margin and SG&A trends are not sustainable Walmart U.S. GM and SG&A as percentage of sales Significant rise in SG&A and prices over past 10 fiscal years GM % SG&A % FY 00 01 02 03 04 Note: Performance based Walmart fiscal years 7 Wal-Mart Stores, Inc. (NYSE: WMT) 05 06 07 08 09 10 11 Over $2B price investment in next 2 years* Price reductions funded by • Broad application • Lead with trafficdriving categories * Represents FY13 and FY14 8 Wal-Mart Stores, Inc. (NYSE: WMT) • Lower new store and remodel costs Operate for less • Long-term investment starting now Buy for less Grow Sales Productivity improvements Sell for less • Productivity in stores and DCs • Efficiency in transportation, ISD and marketing Logistics continues to deliver savings Cases transported (M) • Productivity initiatives – Cases per trailer – Routing improvements – Packaging • 335 million more cases shipped Miles driven (M) FY08 FY09 FY10 Note: Performance based on Walmart fiscal years 9 Wal-Mart Stores, Inc. (NYSE: WMT) FY11 FY12 E • 300 million fewer miles driven “One-touch” bringing additional efficiencies Aligning work schedules to daily tasks 10 Wal-Mart Stores, Inc. (NYSE: WMT) Category-sorted dry grocery pallets Enhanced backroom sorting Over $2B price investment in next 2 years* Price reductions funded by • Broad application • Lead with trafficdriving categories * Represents FY13 and FY14 11 Wal-Mart Stores, Inc. (NYSE: WMT) • Lower new store and remodel costs Operate for less • Long-term investment starting now Buy for less Grow Sales Productivity improvements Sell for less • Productivity in stores and DCs • Efficiency in transportation, ISD and marketing Walmart U.S. strategic growth plan 12 1 Price investment through productivity improvements 2 Merchandising improvements 3 Multi-channel strategy that leverages existing assets 4 Market share-driven real estate strategy Wal-Mart Stores, Inc. (NYSE: WMT) Merchandise principles making an impact 13 Wal-Mart Stores, Inc. (NYSE: WMT) EDLP: foundation and customer commitment • Committed to price leadership • Foundation of our business model and merchandising approach • Benefits all stakeholders • Provides consistency, customer trust, long-term loyalty and growth 14 Wal-Mart Stores, Inc. (NYSE: WMT) More than 10,000 items returned to shelves • Added back key brands Dry grocery Consumables Completed Dairy, Deli, Frozen, Pets Health & Wellness Hardlines Completed Note: Presented at Analyst meeting 10/12/2010 15 Wal-Mart Stores, Inc. (NYSE: WMT) Entertainment Home Apparel • Increased assortment within existing brands • Expanded store-item combinations In progress • Continue to review assortment to meet customer needs On shelf availability focus driving sales 570 bps Mar 19 Current fiscal year Note: Performance improvement from March 19 – Sept 30, 2011 16 Wal-Mart Stores, Inc. (NYSE: WMT) Sept 30 Merchandise density driving top line sales • Action alley restored • Raised shelf heights • Increased modular space 17 Wal-Mart Stores, Inc. (NYSE: WMT) Food business gaining momentum Food comp trend • EDLP and assortment resonating with customers • Continuing improvement in traffic across broad customer groups • Inflation being offset with trade-down Q1 FY12 Note: Performance on 4-5-4 calendar basis 18 Wal-Mart Stores, Inc. (NYSE: WMT) Q2 FY12 Q3 FY12 E Impact of the economy seen in our customers’ trade-down choices Private label Branded for $0.82 -7% GV for $0.60 +24% Note: Performance based on Q2 TY vs. Q2 LY on a 4-5-4 calendar basis 19 Wal-Mart Stores, Inc. (NYSE: WMT) Private label and smaller sizes Branded GV GV -11% -4% +2% Density and simplicity in hardlines Hunting +16% comp Note: Tires comp is YTD, Hunting and Fishing is season to date 20 Wal-Mart Stores, Inc. (NYSE: WMT) Tires +7% comp Fishing +9% comp Apparel strengthening the foundation • Simplifying the assortment Basics • Adding and growing national brands – Key line focus • Improving store experience – Block merchandising • Focusing on big box merchandising Simplified assortment for core customer 21 Wal-Mart Stores, Inc. (NYSE: WMT) Apparel basics showing positive results Underwear +6% comp Note: September comps on 4-5-4 calendar basis 22 Wal-Mart Stores, Inc. (NYSE: WMT) Socks +8% comp Jeans +5% comp Apparel delivering 600 bps of comp trend improvement Apparel comp sales • Add-backs in plus and mature ladies categories performing well • Overall assortment improvements across apparel driving results Q3 FY11 Q4 FY11 Note: Performance on 4-5-4 calendar basis 23 Wal-Mart Stores, Inc. (NYSE: WMT) Q1 FY12 Q2 FY12 Q3 FY12 E Home emphasis on basics and value • Focus on basics • Drive volume selling items Assortment true to Walmart customer – 80/20 item focus • Rationalize private brands • Strengthen OPP presence and quality – Block merchandising National brands + quality 24 Wal-Mart Stores, Inc. (NYSE: WMT) Entertainment focus on value and immediacy • Deliver value with OPP • Win in declining categories • Win in innovation and new releases • Drive consumables and attachments – Simple and focused • Leverage multi-channel 25 Wal-Mart Stores, Inc. (NYSE: WMT) Holiday 2011 plan Layaway Ad Match Black Friday Item & price Fresh focus 26 Wal-Mart Stores, Inc. (NYSE: WMT) Top toys for Christmas 2011 27 Wal-Mart Stores, Inc. (NYSE: WMT) Marketing for the holidays TV & Radio • Large share of voice in national television Circulars, FSIs & catalogs • • • • 28 Online & in-store events • • • Facebook cadence Digital banner In-store events 7 tabs, 10 free standing inserts Toy catalog Holiday entertaining guide Apparel guide Wal-Mart Stores, Inc. (NYSE: WMT) Layaway is back! • • • • • TV Radio PR FSIs Facebook Walmart U.S. strategic growth plan 30 1 Price investment through productivity improvements 2 Merchandising improvements 3 Multi-channel strategy that leverages existing assets 4 Market share-driven real estate strategy Wal-Mart Stores, Inc. (NYSE: WMT) Multi-channel advantage Assortment Distinctive Walmart Access Multi-channel Fulfillment 31 • Assortment growth to complement stores • Channel optimization tools • Align incentives around customer • Access to underpenetrated markets • Next day delivery • Focused marketing with geo-targeting • Free, fast delivery options • Reduced fulfillment costs and time • Leverage existing assets for flexibility Wal-Mart Stores, Inc. (NYSE: WMT) Fast, faster, fastest for free • Leverage assets to lower costs and save customers money • Flexibility for the way customers want to shop or receive items • Multi-channel capabilities that others can’t match 32 Wal-Mart Stores, Inc. (NYSE: WMT) Mobile enables a multi-channel experience 33 Browse your local store Plan your store visit Transact with optimized checkout iPad launch Smart shopping lists Mobile Wal-Mart Stores, Inc. (NYSE: WMT) Walmart U.S. strategic growth plan 34 1 Price investment through productivity improvements 2 Merchandising improvements 3 Multi-channel strategy that leverages existing assets 4 Market share-driven real estate strategy Wal-Mart Stores, Inc. (NYSE: WMT) Significant growth opportunity remains Real Estate Strategy Fill-in medium/ high share markets 35 Penetrate low share markets Wal-Mart Stores, Inc. (NYSE: WMT) Smaller formats Convert discount stores (expansion/ relocation) Maintain the fleet (remodel) Supercenters remain best vehicle to capture market share • New stores, relocations, and expansion growth opportunities • Shifting capital from remodels, while maintaining the condition of the fleet • Continue to reduce new store construction costs 36 Wal-Mart Stores, Inc. (NYSE: WMT) Neighborhood Market strong performance • NM showing sales and profit growth • 5 consecutive quarters of positive comp sales and traffic growth* • NM financial returns approaching that of supercenters * Note: Based on 4-5-4 calendar through Q2 FY12 37 Wal-Mart Stores, Inc. (NYSE: WMT) Walmart Express delivering strong early sales Walmart Express in initial pilot stage Stage 1 Stage 2 Sales? Stage 3 Scalable? ? Accelerate Rollout • Initial pilots under way and sales results exceeding expectations • Sales and operating performance will determine speed of rollout 38 Wal-Mart Stores, Inc. (NYSE: WMT) Bringing the Walmart promise to customers 39 Wal-Mart Stores, Inc. (NYSE: WMT) Walmart U.S. capital expenditure FY11 Actual FY12 Estimate FY13 Projection New Stores $2.7 $3.8 - $3.9 $4.8 - $5.0 Remodels $3.0 $1.3 - $1.5 $0.5 - $0.6 Logistics $0.7 $0.6 - $0.7 $0.3 - $0.4 Other $0.9 $0.8 - $0.9 $0.4 - $0.5 Total Walmart U.S. $7.3 $6.5 - $7.0 $6.0 - $6.5 Additional Walmart U.S. Sq. Ft. 11M 10M - 11M 14M - 15M Total Walmart U.S. Unit Growth 153 142 - 150 210 - 235 CapEx Detail 40 ($ in billions) Wal-Mart Stores, Inc. (NYSE: WMT) Walmart U.S. key takeaways 41 1 Price investment through productivity improvements 2 Merchandising improvements 3 Multi-channel strategy that leverages existing assets 4 Market share-driven real estate strategy Wal-Mart Stores, Inc. (NYSE: WMT) Wal-Mart Stores, Inc. (NYSE: WMT) 18th Annual Meeting for the Investment Community 42 Wal-Mart Stores, Inc. (NYSE: WMT)
