Walmart Canada’s growth slowing

TORONTO Walmart Canada charted its 10th-consecutive quarter of same-store sales growth in the third quarter as the big-box giant continued to put pressure on this country’s traditional grocery retailers.

The country’s biggest mass merchant said sales at stores in Canada open for more than a year, a key industry performance metric, rose 1.1 per cent in the period ended Oct. 31, propelled by a 0.2 per cent gain in customer traffic and a 0.9 per cent gain in average basket size at the checkout.

The growth came as competition from Canada’s traditional grocery companies such as Loblaw and Metro strategically lowered their food prices to win over customers drawn to price cuts at discount chains and Walmart. As such, their efforts appear to be working, because although Walmart’s sales and market share gains grew, they appear to be slowing down.

In Canada, a “cost analytics program continues in helping drive down cost of goods allowing us to invest in price,” Brett Biggs, executive vice-president and chief financial officer at Arkansas-based WalMart Stores Inc. told a conference call Thursday. “We also reduced inventory levels even as sales increased.”

Total quarterly revenue at Walmart Canada, which does not break out a full set of financial results, rose by 3.3 per cent, and operating income rose on a normalized basis. The retailer also noted its market share in food and consumables and health and wellness increased by 60 basis points, according to market research firm Nielsen.

Walmart Canada has 408 stores, and about 325 are “supercentres” with a full discount grocery store inside. Overall, Wal-Mart’s samestore sales at its U.S. locations rose 1.2 per cent in the quarter, below analyst predictions of 1.3 per cent growth.

The U.K. was the retailer’s hardest hit market — Wal-Mart’s U.K. same-store sales fell 5.8 per cent and customer traffic fell 4.2 per cent.

“We are not satisfied,” chief executive Doug McMillon said in a statement about the retailer’s overall performance.