Wal-Mart To Close 48 Of 61 Bud's Discount City Stores
Wal-Mart Says Bud's Stores Weren't Meeting Business Goals
Wal-Mart Comfortable With Analyst 2Q Views Despite Charge
BENTONVILLE, Ark. (Dow Jones)--Wal-Mart Stores Inc. (WMT) said Tuesday it plans to close 48 of its 61 Bud's Discount City stores, because the stores were not meeting the company's its business goals.
In a press release, Wal-Mart giant said it will record a one-time pretax charge in the amount of $40 million to $50 million in the second quarter, to cover the costs of closing the stores and disposing of the related real estate.
Wal-Mart said that despite the charge, its management remains comfortable with current analysts' estimates for the second quarter ended July 31.
A First Call survey of 27 analysts estimates Wal-Mart's second quarter
earnings at 35 cents a share. The company reported net income of $706 million, or 31 cents a share, for the year-ago second quarter.
The company noted that Bud's Discount City accounted for less than $200 million of its $104.8 billion in retail sales during the last fiscal year.
After the closings, Bud's will operate 13 stores in eight states, Wal-Mart said. Wal-Mart said it plans to offer the majority of Bud's salespeople employment in nearby Wal-Mart Stores or Sam's Clubs.
As of June 30, 1997, Wal-Mart said it had 1,939 Wal-Mart stores, 374
Supercenters, 441 Sam's Clubs, 6 Argentina units, 5 Brazilian units, 137 Canadian Wal-Mart stores, 2 China stores, 2 Indonesian Supercenters, 153 Mexican units, and 11 Puerto Rico units. |
