Eye-on-Retail Tipsheet 2/27/13: Home Depot outshines Lowe’s; CEO of Walmart Asia interview



“Strong sales help Home Depot outshine Lowe’s” at Reuters.  “For the 15th straight quarter, Home Depot also bested its rival, Lowe’s Cos Inc, in sales performance at established stores, pointing to an ongoing dominance that analysts say Lowe’s is far from overcoming.  “They are getting the assortment right,” said Robin Diedrich, analyst at Edward Jones, referring to merchandise in stores. “This quarter is a kind of perfect example of that where they really seemed to have gone after the holiday market, in a much bigger way than Lowe’s did.”  She added: “Just really executing on the right product at the right price goes a long way.”  Read more:  https://www.reuters.com/article/2013/02/26/us-homedepot-results-idUSBRE91P0CK20130226


Home Depot call comments:

*  Home Depot’s CFO Carol Tome says while other retailers have talked about customers feeling the pinch of gas prices and payroll tax hikes, Home Depot is not seeing that in its stores.  https://www.reuters.com/article/2013/02/26/homedepot-brief-idUSWEN007YF20130226

*  “Our results benefited from storm repair, but they also reflected an improving housing market,” CEO Frank Blake said on the call.  https://www.marketwatch.com/story/home-depot-profit-up-32-outlook-cautious-2013-02-26

*  Craig Menear, Merchandising Chief:  “The number of customer transitions during the fourth quarter grew 1.7%, on a comparable basis, while average transaction size rose 5.6%, helped in part by inflation in lumber and copper. Tickets under $50, about one-fifth of U.S. sales, rose 0.3%, while transactions over $900, also 20% of sales, jumped 9%, helped by purchases of generators and appliances.”  https://www.marketwatch.com/story/home-depot-profit-up-32-outlook-cautious-2013-02-26


“Social Media Advertising Budgets Rise in 2013” by Elizabeth Palermo at Fox Business News.  “A recent study by Digiday shows that U.S. advertisers plan to spend $4.1 billion this year on social media advertising. And while many companies started buying up ad space on sites like Facebook and Twitter years ago, those businesses now intend to spend even more on this type of advertising.  The study found that 64 percent of advertisers plan to increase social media ad budgets this year. Meanwhile, only 2 percent of advertisers surveyed say they intend to spend less on paid social media ads in 2013 than they did in 2012.  Read more: https://www.businessnewsdaily.com/4012-social-media-advertising-budgets.html?#ixzz2M6LcpC00


“Interview with Walmart’s Scott Price, CEO of Walmart Asia” at Money Control.  “After years of dithering and a false start in 2011, the government finally notified the rules for FDI in multi-brand retail. Companies like Walmart have been waiting to get into the Indian market and this gives them access to the organised sector in India. Scott Price, the CEO of Walmart Asia tells CNBC-TV18 about the company’s plan for the Indian markets.”  Read the full interview:  https://www.moneycontrol.com/news/business/walmarts-backend-experience-to-help-india-biz-asia-ceo_831241.html


 “E-Commerce Customer Satisfaction Continues To Rise According to ACSI”  “Online retail increases 1.2% to an ACSI score of 82, outperforming the brick-and-mortar retail trade sector (76.6) by a wide margin. Amazon continues to the lead the industry (and tops all measured e-commerce companies in this month’s Index) despite a 1% drop to 85. The “all others” category, which is an aggregate of e-retailers and other companies not individually measured, jumps 3% to 82. The “all others” category contains many e-retail websites that also have a brick-and-mortar presence.”  Read more:  https://media.prnewswire.com/en/jsp/latest.jsp?resourceid=6373289&access=EH


“Wal-Mart says its e-commerce push is working” by Kevin Woodward at Internet Retailer.  “Wal-Mart, No. 4 in the Internet Retailer Top 500 guide, said in October it expects to reach $9 billion in e-commerce revenue for the fiscal year ending Jan. 31, 2014. Only two U.S. retailers exceeded $9 billion in web sales in 2011, the last year for which top 500 data are available: Amazon.com Inc., No. 1 in the Top 500, and No. 2 Staples Inc. Apple was No. 3 with $6.66 billion in online sales, according to Internet Retailer estimates.”  Read more: https://www.internetretailer.com/2013/02/26/wal-mart-says-its-e-commerce-push-working#sthash.rMySvQ9b.dpuf


“Retail M&A Activity Will Continue to Rebound in 2013, BDO USA Survey Finds”  “The retail industry is poised for another year of heavy deal flow. According to a new survey from BDO USA, LLP, nearly all retail CFOs (94 percent) expect merger and acquisition (M&A) activity will increase or remain steady in 2013. CFOs’ bullish forecasts follow $324.6 billion in global retail and consumer M&A activity in 2012, which was up 33 percent over 2011 and the busiest year since 2007, according to Dealogic. A majority of CFOs (68 percent) expect the U.S. markets to see a majority of deal volume, followed by the Asia-Pacific market (20 percent) and Latin America market (7 percent).”  Read more:  https://www.businesswire.com/portal/site/home/permalink/?ndmViewId=news_view&newsLang=en&newsId=20130226005547&div=-1245645151


“Some results of first lady’s anti-obesity effort” by Darlene Superville and Mary Clare Jalonick at AP via The Sun.  “As promised, Wal-Mart also has begun labeling the fronts of hundreds of its store-brand products with a special “Great for You” seal designed to help shoppers easily identify healthier foods…Food Deserts — Wal-Mart, Walgreens, Supervalu and several smaller grocers committed to build or expand 1,500 stores in areas with limited or no access to healthy food, areas the Agriculture Department calls “food deserts.” Wal-Mart, which announced it would open 275-300 such stores by the end of 2016, had opened 86 by the end of last year.”  Read more:  https://www.sbsun.com/living/ci_22677718/some-results-first-ladys-anti-obesity-effort


“Walmart U.S. CEO Bill Simon to present at Raymond James Institutional Investors Conference”  “Wal-Mart Stores, Inc. will participate in the 34th annual Raymond James Institutional Investors Conference on Tuesday, March 5, 2013. Walmart U.S. President and CEO Bill Simon will provide an update on the Walmart U.S. business at 11:35 a.m. EST.”  Read more:  https://www.businesswire.com/portal/site/home/permalink/?ndmViewId=news_view&newsLang=en&newsId=20130226006712&div=-1245645151


“Law Office of Brodsky & Smith, LLC Announces Investigation of OfficeMax Incorporated”  Under the terms of the transaction, OfficeMax shareholders will receive only $13.50 in cash for each share of OfficeMax stock they own. The investigation concerns possible breaches of fiduciary duty and other violations of state law by the Board of Directors of OfficeMax for not acting in the Company’s shareholders’ best interests in connection with the sale process to Office Depot. The focus of the investigation is whether the OfficeMax Board of Directors breached their fiduciary duties by failing to conduct an adequate and fair sales process prior to agreeing to this proposed transaction. The transaction may undervalue OfficeMax as an analyst has set a price target of $17.00 per share for OfficeMax stock.”  Read more:  https://media.prnewswire.com/en/jsp/latest.jsp?resourceid=6370854&access=EH


 “7-Eleven Achieves Record Store Growth in 2012”  “7-Eleven, Inc. achieved record store growth in 2012 and expects the number of 7-Eleven stores worldwide to pass the 50,000-store mark by the end of the first quarter.  Already the world’s largest retailer by store count, 7-Eleven® added close to 5,000 stores to its worldwide portfolio in 2012.  “2012 was a tremendous year for us in terms of organic store growth, acquisitions and business conversions. We expect accelerated growth in North America to continue, and we also see many more opportunities for international expansion.” said 7-Eleven, Inc. President and CEO Joe DePinto.”  Read more:  https://media.prnewswire.com/en/jsp/latest.jsp?resourceid=6380415&access=EH


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