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Charles M. Holley, Jr.
Executive Vice President and Chief Financial Officer
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Simple philosophy
“Our philosophy has always been simple:
We are agents for our customers.”
– Sam M. Walton
Discount
retail
Membership
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Grocery
International
E-commerce
FY15 guidance scorecard
Metrics
FY 15E analyst
guidance*
FY 15E updated
Score
Sales growth
3-5%
2-3%
X
Square footage growth
< / Flat
< / Flat
Operating expense
< Sales
< Sales
Operating income
growth
> Sales
< Sales
Free cash flow
Strong
Strong
Note: *Provided October 15, 2013
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X
X
Working capital management
Net inventory
$7.4
$5.7
$4.1
$2.8
FY11
FY12
FY13
FY14
Note: Net inventory = Inventory – Accounts payable, FY15E - FY16E not drawn to scale
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FY15E
FY16E
Traditional brick & mortar growth
Capex
Moderate growth in large format stores
in the U.S. and globally
$12.7
$11.5 - $12.0
$10.4 - $11.4
Continue rollout of small store formats
Grow in key international markets
FY14
FY15E
Note: Values in billions
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FY16E
Recap of traditional brick & mortar
Sales
Op. income
$27 $28 $28
$458 $463
$437
FY12
FY13
FY14 FY15E FY16E
FY18E
FY12
FY13
Note: Values in billions, FY15E - FY18E not drawn to scale, 1CAGR represents FY15E to FY18E
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FY14 FY15E FY16E
FY18E
E-commerce & digital
Initiatives
Capex
$1.2 – $1.5
• Digital to physical integration
• Global eCommerce platform
~$1.0
• Next generation supply chain
$0.4
• Pangaea
FY14
FY15E
Note: Values in billions
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FY16E
Recap of the e-commerce & digital performance
Op. loss
Sales and GMV
-$0.2 -$0.3 -$0.8
GMV7
Sales
$13.5
$6
$8
FY12
FY13
$10
$12.5
FY14 FY15E FY16E
FY18E
FY12
FY13
FY14 FY15E FY16E
Note: Values in billions, FY15E - FY18E not drawn to scale, 1CAGR from FY15E to FY18E, see appendix for footnotes
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FY18E
FY16 guidance
Metrics
FY16 guidance*
FY16
guidance
Sales growth
2 - 4%
$10B - $20B
Square footage growth3
2 – 3%
26 - 30M sq. ft.
Operating expense growth4
≥ Sales
Operating income growth
≤ Sales
Free cash flow
Strong
*Growth rates based on FY15E - FY16E midpoint, see appendix for footnotes
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Sources and uses of cash
1. Growth
Organic
Cash
from
operations
•
•
•
Stores
E-commerce
Technology
Acquisitions
2. Dividends
3. Share repurchase
AA-rated balance sheet
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Free cash flow
Consistently above $10
$14.1
FY10
billion per year
$12.7
$10.9
$10.7
FY11
FY12
$10.1
FY13
Note: Values in billions, FY15E – FY18E not drawn to scale
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FY14
FY15E
FY16E
FY18E
Capital expenditure guidance
Walmart U.S.
Walmart International
Sam’s Club
Total Segments
Corporate Support
Wal-Mart Stores, Inc.
Note: Values in billions
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Actual
FY14
$6.4
4.4
1.1
$11.9
1.2
$13.1
Revised
FY15
$6.6 – 6.8
3.8 – 4.1
~0.9
$11.3 - 11.8
~1.2
$12.5 – 13.0
Guidance
FY16
$6.1 – 6.6
3.7 – 4.2
~0.8
$10.6 – 11.6
1.0 – 1.3
$11.6 – 12.9
Capital expenditure guidance
Walmart U.S.
Walmart International
Sam’s Club
Total Segments
Corporate Support
Wal-Mart Stores, Inc.
Traditional brick & mortar
E-commerce & digital
Note: Values in billions
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Actual
FY14
$6.4
4.4
1.1
$11.9
1.2
$13.1
$12.7
$0.4
Revised
FY15
$6.6 – 6.8
3.8 – 4.1
~0.9
$11.3 - 11.8
~1.2
$12.5 – 13.0
$11.5 – 12.0
$~1.0
Guidance
FY16
$6.1 – 6.6
3.7 – 4.2
~0.8
$10.6 – 11.6
1.0 – 1.3
$11.6 – 12.9
$10.4 – 11.4
$1.2 – 1.5
Global square footage guidance
Net retail square footage
Actual
Revised
Guidance
FY14
FY15
FY16
Walmart U.S.
18.4
~21 - 22
~15 - 16
Walmart International
12.5
~9 - 10
~10 - 13
Sam’s Club
1.7
~2
~1
Wal-Mart Stores, Inc.
32.6
~32 - 34
~26 - 30
Note: Values in millions
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Returns to shareholders - dividends
Dividends have increased for 41
$1.09
$1.21
FY10
FY11
Note: 5-year CAGR of 12.0% (FY10 – FY15)
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$1.46
FY12
consecutive years
$1.88
$1.92
FY14
FY15
$1.59
FY13
Returns to shareholders - share repurchase
$14.8
$7.6
$7.3
$6.3
FY10
FY11
Note: Values in billions
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FY12
FY13
$6.7
FY14
Today’s takeaways
Customer focused
Price, assortment, access, and service
Investing for future growth
Disciplined capital spend, with shift in focus
Set up for continued shareholder returns
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Appendix
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Notes
1.
CAGR (compound annual growth rate) – this is the year over year growth rate applied to an investment or other
part of a company’s activities over multiple periods. The formula for CAGR is (Current Value / Base Value)^(1/
number of years) -1.
2.
Free Cash Flow (FCF) – Wal-Mart Stores, Inc. defines free cash flow, a non-GAAP financial measure, as net cash
provided by operating activities minus payments for property and equipment (as such amounts appear on the
pertinent statements of cash flow or equivalent financial statements).
Free Cash Flow Reconciliation
FY14
FY13
Net Cash provided by operating activities
23,257
25,591
Payments for property and equipment
(13,115)
(12,898)
Free Cash Flow
10,142
12,693
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Notes
3.
Square Footage Growth – Square footage projections for fiscal years 2015 and 2016 are approximations and do
not include square footage gained during the close of acquisitions, but do include square footage added after the
acquisition closed. Square footage increases reflect additions made between February 1 and January 31 of each
respective year.
4.
Operating expense growth – Wal-Mart Stores, Inc. has disclosed its definition of SG&A expense in the Form 10K filed by Wal-Mart Stores, Inc. on March 21, 2014.
5.
Capital Expenditures (Capex or capital spending) – refers to Wal-Mart’s payments for property and equipment.
6.
FY15, FY16, FY17, FY18 Projections – The anticipated, projected, or expected amounts, numbers, or results for
the complete fiscal year 2015 and beyond discussed in connection with, or included in, this presentation constitute
estimates and projections of Walmart’s management and as such, are forward-looking statements. Please refer to
Walmart’s Safe Harbor Statement provided in conjunction with the presentations at this meeting and read at the
beginning of this meeting.
7.
“global eCommerce gross merchandise value” or global eCommerce “GMV” is defined as the total sales value
of merchandise sold or transacted where the transaction originates online, excluding the sale of gift cards.
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