Walmart Canada sees sales uptick, thanks to 20th anniversary and Supercentres
Superstore construction and a 20th anniversary event in June helped tick up Walmart’s sales in Canada 2.9% during the second quarter.
However, traffic dropped 1.1% and same-store sales were essentially flat at 0.2% during the three months ended July 31 compared to the same period last year. Dollar sales were not provided.
In a taped conference call on Thursday, David Cheesewright, Walmart International’s president and CEO, described the Canadian results as “solid in a very competitive environment.”
Walmart is taking away business from its Canadian rivals in the food, consumable and health and wellness categories, he noted, with a 50-basis point rise in market share in those categories during the last year, based on Nielsen data.
“We were encouraged by our performance in food and consumables, driven by Supercentre expansions,” he said.
Cheesewright said that second-quarter sales were helped by the opening of more Supercentres as well as promotions in June marking Walmart’s 20th anniversary in this country.
Walmart entered Canada in 1994 through its purchase of Woolco and currently operates 391 stores.
In February, Walmart announced a $500 million expansion plan that included adding more Supercentres, which, unlike Walmart discount stores, carry a full line of groceries. By next January 282 of the company’s 395 stores will be Supercentres.
During his presentation, Cheesewright noted that the 0.2% hike in sale-stores sales was an improvement over the Canadian division’s first quarter results. He added that same-store sales were particularly strong in over-the-counter medicine.
Cheesewright did not mention e-commerce, an area Walmart Canada has started to focus on in the last year and which was included in the 2.9% sales hike.
During the second quarter, Walmart made some changes to its Canadian operations, both at the top and in its stores.
In May it gave Canadian president and CEO Shelley Broader a more international role. She’s now executive vice-president, president and CEO of Europe, the Middle East, sub-Saharan Africa and Canada.
A new Canadian president and CEO, Dirk Van den Berghe, started Aug. 1. He was previously CEO of Belgium and Luxembourg for European grocer Delhaize Group.
At the end of May, Walmart Canada announced it was cutting 750 management jobs after testing a new management structure in select stores.
In addition to the cuts, Walmart said that it had promoted 1,300 staff to more senior roles and about 200 store managers were added in order to make staff more available to shoppers during peak hours of business.
The restructuring has resulted in improved customer service and cost savings, Cheesewright said Thursday.
However, he noted that Walmart Canada’s operating income “declined year over year.”