Walmart 2013 Annual Report Download - page 28

Management’s Discussion and Analysis of Financial
Condition and Results of Operations
26 || Walmart 2013 Annual Report
Global Expansion Activities
In addition to our growth in retail square feet discussed throughout the
“Results of Operations” discussion, we also experienced global expansion
in e-commerce in each of our segments during  scal 2013, with Walmart
U.S. and Sam’s Club focused on the e-commerce market in the U.S. and
Walmart International focused on the international e-commerce markets
in countries outside of the U.S., primarily the United Kingdom, Brazil and
China. Some of our  scal 2013 e-commerce accomplishments included
developing pricing optimization tools, mobile applications and a new
search engine available on our various websites. Each of these accom-
plishments further supports our segment operations and helps us save
people money so they can live better. Our Walmart International segment
also increased its investment in Newheight Holdings Ltd, a company
that owns Yihaodian, an e-commerce business in China, to approximately
51% during  scal 2013.
Our  scal 2014 global expansion plans include growing our retail square
feet and expanding our e-commerce capabilities, which we plan to
 nance primarily through cash  ows from operations and future debt
 nancings. The following table provides our estimated range for  scal
2014 capital expenditures, as well as our estimated range for growth in
retail square feet. Our anticipated e-commerce capital expenditures are
included in our estimated range for  scal 2014 capital expenditures.
The amounts in the table do not include capital expenditures or growth
in retail square feet from any future acquisitions.
Fiscal 2014 Fiscal 2014
Projected Capital Projected Growth in
Expenditures Retail Square Feet
(in billions) (in thousands)
Walmart U.S. $ 5.5 to $ 6.0 15,000 to 17,000
Walmart International 4.5 to 5.0 20,000 to 22,000
Sam’s Club 1.0 to 1.0 1,000 to 1,000
Other Unallocated 1.0 to 1.0 — to —
Total $12.0 to $13.0 36,000 to 40,000
The following table represents the allocation of our capital expenditures
for property and equipment:
Allocation of Capital Expenditures
(Amounts in millions) Fiscal Years Ending January 31,
Capital Expenditures 2013 2012
New stores and clubs, including
expansions and relocations $ 4,340 $ 3,735
Information systems, distribution,
e-commerce and other 2,922 2,852
Remodels 995 1,648
Total U.S. 8,257 8,235
Walmart International 4,641 5,275
Total capital expenditures $12,898 $13,510
Cash Flows Used in Financing Activities
Cash  ows used in  nancing activities generally consist of transactions
related to our short-term borrowings and long-term debt, as well as
dividends paid and share repurchases.
Short-Term Borrowings
Short-term borrowings increased $2.8 billion for  scal 2013, compared
to an increase of $3.0 billion during the same period in the previous  scal
year. From time to time, we utilize the liquidity under our short-term
borrowing programs to fund our operations, dividend payments, share
repurchases, capital expenditures and for other cash requirements and
corporate purposes, as needed. As a result, we have continued to utilize
the favorable interest rates available on our commercial paper and
increased our short-term borrowings during the  scal years ended
January 31, 2013 and 2012.
Long-Term Debt
We did not complete any signi cant long-term debt issuances during
 scal 2013, due in part to our free cash  ow of $12.7 billion, as well as our
continued use of short-term borrowings. Proceeds from the issuance
of long-term debt during  scal 2012 and 2011 were $5.1 billion and
$11.4 billion, respectively, which were used to pay down or re nance
existing debt and for other general corporate purposes.
Dividends
Our total dividend payments were $5.4 billion, $5.0 billion and $4.4 billion
for  scal 2013, 2012 and 2011, respectively. On February 21, 2013, the Board
of Directors approved an increase in the annual dividend for  scal 2014 to
$1.88 per share, an increase of approximately 18% over the $1.59 per share
dividend paid in  scal 2013. For  scal 2014, the annual dividend will be
paid in four quarterly installments of $0.47 per share, according to the
following record and payable dates:
Record Date Payable Date
March 12, 2013 April 1, 2013
May 10, 2013 June 3, 2013
August 9, 2013 September 3, 2013
December 6, 2013 January 2, 2014
Company Share Repurchase Program
From time to time, the Company repurchases shares of its common stock
under share repurchase programs authorized by the Board of Directors.
The current $15.0 billion share repurchase program has no expiration
date or other restriction limiting the period over which the Company
can make share repurchases under the program. At January 31, 2013,
authorization for $3.7 billion of share repurchases remained under the
current share repurchase program. Any repurchased shares are construc-
tively retired and returned to an unissued status.
We consider several factors in determining when to execute share
repurchases, including, among other things, current cash needs, capacity
for leverage, cost of borrowings and the market price of the Company’s
common stock. Cash paid for share repurchases during  scal 2013, 2012
and 2011, was as follows:
Total Number Average
of Shares Price Paid Total
Repurchased per Share Investment
Share Repurchases (in millions) (in dollars) (in billions)
Fiscal year ended January 31, 2013 113.2 $67.15 $ 7.6
Fiscal year ended January 31, 2012 115.3 54.64 6.3
Fiscal year ended January 31, 2011 279.1 53.03 14.8