US: Wal-Mart plans to reduce capital expenditure
Wal-Mart Stores said it intends to reduce its capital expenditure in fiscal 2014, but emphasised it will add roughly the same amount of retail space as this year.
The company's capital expenditure for the year ending 31 January 2014 will range from US$12bn to $13bn, compared to the $12.6-13.5bn it expects to spend during the current financial year.
The retailer said the reduction in capital expenditure will drive comparable and new store growth, operating leverage and productivity initiatives as well as expansion in global e-commerce, including acquisitions.
Wal-Mart's three operating segments will add 36-40m sq ft in retail space, which remains flat against the fiscal 2013 forecast of 36-39m sq ft.
The world's largest retailer yesterday (10 October) said it plans to grow its sales 5-7% in fiscal 2014, which is expected to increase net sales by $23bn to $33bn.
Wal-Mart also plans to invest in technology including e-commerce initiatives such as a global technology platform and applications for mobile and social media.
Neil Ashe, president and CEO of Walmart global e-commerce said: "We will continue to innovate in ways that will allow us to expand our global platform and strengthen our infrastructure and local fulfillment networks, while taking advantage of transformational mobile capabilities."
The company added that it remains on track to reduce operating expenses as a percentage of sales by 100 basis points over five years with savings reinvested in lower prices and improved international profitability.
"Our momentum in delivering strong results continues, and we are investing for the future by creating an even stronger business," said Wal-Mart Stores president and CEO Mike Duke.
"Strong business fundamentals are driving our top line and bottom line results. We are delivering on the productivity loop and being even more disciplined about our operating expenses and capital spending. We have a deliberate approach to how we will grow, how we will deliver further operating leverage and continue to deliver strong returns to our shareholders."
International capital expenditure will range from $4.5bn to $5bn, with improvements in engineering and construction expected to drive greater efficiencies. New stores are expected to add 20-22m sq ft next year, which is in line with the 21-23m sq ft expansion forecast for the current fiscal year.
Social and environmental compliance are the main issues facing today's apparel supply chains, according to industry experts consulted by just-style. The continued shift towards faster and faster fashi...
The UK-based George at Asda clothing brand remains committed to sourcing in Bangladesh, even though at least 112 workers were killed in a factory fire last year while illegally subcontracted to produc...
Wal-Mart has revealed that its efforts to turn around its apparel business is starting to gain traction after reporting its first full-year of positive comparable apparel sales in the US in seven year...
Updated sourcing guidelines released this week by Wal-Mart have received a tepid reception at best, with industry watchers warning they are sceptical as to whether the new rules will be fully enforced...
George at Asda is set to launch a new label called G21 Talent, a line of limited edition, catwalk inspired collections created by designers from Graduate Fashion Week....
Global sourcing giant Li & Fung Ltd has seen its full-year profit slump despite a slight rise in turnover, blaming ongoing restructuring costs and weakness in its distribution business....
- 2014: Year in review - Sourcing winners and losers
- COMMENT: The decline of the buying office
- 2014: Year in review - Brand winners and losers
- 2014: Year in review - Retail winners and losers
- Bangladesh: Raising the bar on apparel exports?
- Report urges overhaul of Cambodia factory safety
- Bangladesh knitting worker killed by faulty lift
- North Face debuts locally-grown "backyard" hoodie
- Bangladesh factory improvements “will take years”
- Apparel manufacturing leads US reshoring trend