(Updates with CFO’s comment in third paragraph.)
June 3 (Bloomberg) -- Wal-Mart Stores Inc., the world’s largest retailer, said it will buy back $15 billion of its shares after the pace of profit growth doubled last year.
The buyback replaces a previous $15 billion program, which was announced June 4, 2010 and had about $2 billion remaining, the Bentonville, Arkansas-based company said today in a statement. Wal-Mart is holding its 41st annual shareholder meeting today in Fayetteville, Arkansas, which is being attended by about 14,000 people.
“Our purchase of almost $13 billion of Walmart stock since last June is indicative of our strong free cash flow position,” Chief Financial Officer Charles Holley said in the statement.
While profit growth has accelerated, Wal-Mart’s U.S. comparable-store sales have fallen for eight straight quarters as shoppers grapple with rising grocery and gasoline prices and persistent unemployment. To stem the declines, Chief Executive Officer Mike Duke has added thousands of products back to the shelves, announced plans to open smaller outlets and pledged to match local rivals’ prices in a national ad campaign.
Wal-Mart fell 5 cents to $53.50 at 10:16 a.m. in New York Stock Exchange composite trading. The shares have dropped less than 1 percent this year before today.
The economy created 54,000 jobs in June, and the jobless rate unexpectedly climbed to 9.1 percent, to the highest level this year, from 9 percent a month earlier, the Labor Department said earlier today.
Confidence among U.S. consumers unexpectedly declined in May to a six-month low as Americans’ outlook for income growth and business hiring worsened, the Conference Board said May 31. Slower than expected job and wage growth means consumer spending, which accounts for about 70 percent of the economy, may remain in check.
--With assistance from Shobhana Chandra in Washington. Editors: James Callan, Julie Alnwick
To contact the reporter on this story: Matthew Boyle in New York at Mboyle20@bloomberg.net.
To contact the editor responsible for this story: Robin Ajello at email@example.com.