EARNINGS ROUNDUP : Wal-Mart Reports Record 2nd-Quarter Profit, Sales

Wal-Mart Stores Inc. on Tuesday reported record second-quarter sales and earnings, despite what the nation’s largest retailer said was a sluggish economy.

Among other retailers, Dayton Hudson Corp. reported a sharp drop in earnings, J.C. Penney Co. a slight decline and Home Depot Inc. a gain.

Bentonville, Ark.-based Wal-Mart said earnings rose for the 98th straight quarter to $633 million, or 28 cents a share, from $565 million, or 25 cents a share, for the period a year earlier. Sales reached $22.7 billion, up 14%.

“Our earnings growth, excluding non-recurring gains, exceeded our sales growth despite a sluggish economy and low inflation,” David Glass, president and chief executive, said in a statement.

The Wal-Mart division, including Supercenters, saw operating profit rise 13% to $1.1 billion. Profit at its Sam’s Division warehouse clubs jumped 49% to $250 million.

Wal-Mart shares added 12.5 cents to close at $24.75 on the New York Stock Exchange on Tuesday.

Minneapolis-based Dayton Hudson, the nation’s fourth-largest retailer, reported a sharp drop in second-quarter earnings, to $28 million, or 32 cents a share, from $49 million, or 61 cents a share, a year ago.

It blamed the results on its Mervyn’s division, where operating profit was essentially zero, revenue declined 2% and comparable-store revenue, or sales at stores open at least a year, fell 4%.

“Although Mervyn’s second-quarter and first-half results are disappointing, we are optimistic that our repositioning efforts will result in steadily improving performance beginning in the third quarter,” said Bob Ulrich, Dayton Hudson chairman and chief executive.

Revenue increased 9% for the quarter, to $5.24 billion from $4.8 billion last year. Sales at stores open at least a year rose 3%.

Dayton Hudson stock closed down 25 cents at $72.75 on the NYSE.

J.C. Penney, based in Plano, Tex., said its earnings for the second quarter fell to $116 million, or 46 cents a share, from $132 million, or 51 cents, a year earlier. Sales hit $4.4 billion, up from $4.2 billion.

Its profit margins fell in the quarter as it cleared summer merchandise and made way for fall offerings. Its department stores also held more sales at the end of the quarter to reduce inventory.

“Sales of fall merchandise, primarily apparel, have been particularly encouraging in recent weeks,” James Oesterreicher, vice chairman and chief executive, said in a statement.

J.C. Penney stock eased 12.5 cents to $46.875 on the NYSE.

Home Depot, the home improvement chain, said its earnings rose in the second quarter but that the growth was held back by a slow economy.

Earnings at the Atlanta-based company rose to $212 million, or 45 cents a share, from $178 million, or 39 cents, a year earlier. Sales for the quarter reached $477.7 million, compared to $475 million a year earlier.

The company had expected an economic slowdown to constrain the quarter’s sales, and it responded by lowering prices in several product areas. That cut its profit margin for the quarter.

Home Depot stock lost 87.5 cents to close at $42.375 on the NYSE.