Walton Family Faces a Tough Decision About Walmart's CEO

Posted 11:00AM 06/03/11 Company News, Wal-Mart Stores, Target Corp, Retail

Walton Family Faces a Tough Decision About Walmart's CEO Walmart's annual shareholder meeting is Friday, and sure to be discussed will be the news that earnings for the last quarter weren't very good. Net sales for the first quarter of fiscal 2012, which ended April 30, were $103.4 billion, an increase of 4.4% from $99 billion in the same quarter a year ago. Income from continuing operations attributable to Walmart (WMT) for the quarter was $3.4 billion, up 3.8% from the first quarter last year.

Worse than the overall modest gains for the world's largest retailer is the fact that same-store sales for the flagship U.S. operations were down 1.1%

Walmart has tried several initiatives to turn around its domestic operations. All have failed. The latest plan is to open smaller Walmart Express outlets. These locations will be about 10% the size of normal Walmart stores, and will stock primarily food and general merchandise. At the same time, Walmart's Sam's Club unit will begin to offer more groceries.

If this new plan doesn't work, pressure will increase for the board to consider removing CEO Michael Duke (pictured). The success of his tenure has been questioned before, but the board's role is not often discussed.

Walmart's board is made up of 15 people, but only two really count: Chairman S. Robson Walton who has been on the board since 1978, and Jim Walton, who has been a member since 2005. The Walton family holds more than 1.6 billion shares of Walmart, or 48.3% of the total. During the last two years, the stock has significantly underperformed that of rival Target (TGT). That puts pressure on the Waltons to act on the behalf of shareholders, and also on behalf or themselves.

Walmart's board didn't have any trouble ousting former CEO Lee Scott, who served from 2000 to 2009. His record on labor and the environment was criticized for years. The Waltons may decide that it is time to find a replacement for Duke to see if a new candidate can turn U.S. retail operations around.


Douglas McIntyre

Douglas McIntyre


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FairTax Mel

You know that WalMart stock was soaring when they actually cared about their employees and customers. You can only treat people like dirt under your feet for so long before they say enough is enough and shop elsewhere. It does not matter if I have to pay a little more for the same item when I see and hear how people are treated by a company I will go somewhere that values America and her people. WalMart needs to go back to the values of Sam Walton and quit stealing from their employees.

21 minutes ago Report abuse rate up rate down Reply
JoAnna Marie Toth

I do not ever shop at Walmart due to their greed and abuse of their workers!! Dollar General and Target have eveything anyone could ever need!! Am thinking about dumping Target for the same reasons as Walmart though, but there is always Amway if a person wants to get completely away from the big business crooks!!! Use your brains and your wallets people, you made these greedy corporations as big as they are by shopping with them, you can bring them to size just as quickly by NOT shopping with them. I can think of a million avenues to avoid being reliant on these crooks and so can you!!

52 minutes ago Report abuse rate up rate down Reply
Real Cal Gal

Couldn't happen to a more deserving local job killer.

1 hour ago Report abuse +1 rate up rate down Reply
Dear MoonWolf

Walmart is losing sales because well-informed buyers like me wouldn't be caught DEAD crossing the threshold of a union-busting, low-life outfit like that, filled w CRAP made by the COMMIE CHINESE and in other countries where people are actually MURDERED in preventing their wokers from getting decent wages or unionizing and not being treated like SLAVE LABOR, made to live in apt. bldgs. owned by the companies for whch they work so that these poor, helpless victims have to owe their SOULS to the company store. Thse companies in China have even put nets outside the factory windows, to stop their victims from trying to escape their hopeless lives by committing SUICIDE. F Walmart.

1 hour ago Report abuse +1 rate up rate down Reply
David Brattain

WalMart is all about price performance. One can only wring so much out of suppliers, employees, local and state governments in order to offer "lowest price". In addition, there is only so much useless crap people can buy in a down economy.

2 hours ago Report abuse rate up rate down Reply
stahlbabs56

Have you ever stood and watched the self checkout lines....I think they need to hire more security!!!! Start treating their employees better and maybe they woudl care about it too. How much do you suppose walks out the door everyday???

3 hours ago Report abuse +2 rate up rate down Reply
dcrand7

Why did they change his bonus criteria - previously always based on same store sales (which dropped) to global sales (which increased)? Sounds like the board needs a shakeup as well.

3 hours ago Report abuse +1 rate up rate down Reply
sweetwind0146

No surprise here. For years the company has been killing their associates and raping the towns businesses that they force their way into. Some of the managers that they find to run the stores are pure idiots! Where do they find these people?

4 hours ago Report abuse +1 rate up rate down Reply
Mickey markoff

@ Lisa, I saw the same thing...it's like a peky time machine gone bad!
"Net sales for the first quarter of fiscal 2012, which ended April 30, were $103.4 billion, an increase of 4.4% from $99 billion in the same quarter a year ago." Meaning THIS year??? And who can live on a paltry $103 billion?

4 hours ago Report abuse +2 rate up rate down Reply
Lisa

Sales for 2012? Don't they mean 2011?

6 hours ago Report abuse +1 rate up rate down Reply
1 reply to Lisa's comment
wyarbrough@daxko.com

fiscal year...

6 hours ago Report abuse rate up rate down Reply
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