Wal-Mart cashes in on downturn

Wal-Mart, the worldÔÇÖs biggest retailer, has beaten forecasts with a ten percent increase in third-quarter profitsÔÇö and there are few retailers who can say that this year. ┬á If I can be excused for turning a popular saying inside out, itÔÇÖs a case of one storeÔÇÖs poison being another storeÔÇÖs meat. WhatÔÇÖs bad for retailers in high streets and malls can often be meat and drink for Wal-Mart, where the focus on low prices understandably has customers feeling the pinch heading there in ever greater numbers.┬á┬á Wal-MartÔÇÖs profits for the quarter from August to the end of October came in at $3.14 billion, against $2.86 billion last year. Revenues climbed 7.5 percent to $98 billion. Two other US leading retailers, Macy's and Best Buy, reported falling sales Wednesday, as a result of difficult trading conditions, with Best Buy Co. blaming "seismic" changes in consumer behavior for creating "the most difficult climate" it has ever seen.┬á┬á "Our price leadership positions us well and will help our customers in all markets navigate through these difficult times," Wal-Mart president and CEO Lee Scott said in a pre-recorded call. "I am optimistic about the holidays for Wal-Mart and for the Wal-Mart customer. It is our time and we have momentum from the third quarter."┬á┬á Wal-Mart operates stores in 15 countries, including the Asda supermarket chain in the UK, where the decline in the value of the pound against the dollar (it has sunk from over $2 to the pound to less than $1.50 in a few months) has caused it to review its overall profit forecast. ┬á┬á International sales account for a quarter of Wal-MartÔÇÖs revenue, but the company has also suffered exchange rate setbacks in Mexico and Canada, as well as Britain. ÔÇ£The rapid changes in currency exchange rates during the last few weeks are projected to negatively affect this yearÔÇÖs fourth-quarter results by approximately 6 cents per share,ÔÇØ said chief financial officer Tom Schoewe.┬á┬á*┬á┬á┬á┬á┬á┬á┬á┬á┬á *┬á┬á┬á┬á┬á┬á┬á┬á┬á *┬á┬á