Walmart 2015 Annual Report Download - page 36

34 2015 Annual Report
Management’s Discussion and Analysis of
Financial Condition and Results of Operations
• our fiscal 2016 global expansion plans, continued investment in
Neighborhood Markets, moderation in U.S. supercenter growth, growing
our retail square feet and expanding our digital retail capabilities and our
plans to finance our growth activities;
• our estimated range of capital expenditures (including digital retail
capital expenditures) in fiscal 2016 for each of our reportable seg-
ments, in the “Corporate and support” category and in total;
• the estimated/projected growth in retail square feet in total and by
reportable segment in fiscal 2016;
• our cash flows from continuing operations, current cash position and
access to debt and capital markets continuing to be sufficient to meet
our cash needs for operations and other specified purposes; and
• the amount of increases in payments under operating leases if certain
leases are executed (which statement also appears in Note 11 to our
Consolidated Financial Statements);
in the Notes to our Consolidated Financial Statements regarding:
• any portion of our net investment and cash flow instruments that is an
ineffective hedge being insignificant and the amounts related to our
derivatives expected to be reclassified from accumulated other comp-
rehensive income (loss) to net income during the next 12 months
being insignificant (Note 8);
• the realization of certain net deferred tax assets, tax audit resolutions
over fiscal 2016 reducing unrecognized tax benefits within a certain
range or beyond and the reasons for that reduction, any change not
having a significant impact on our Consolidated Financial Statements
and the possibility that the resolution of a group of related non-income
tax matters might result in a material liability to Walmart (Note 9);
• an adverse decision in, or settlement of, certain litigation possibly
resulting in material liability to us and matters relating to an FCPA
investigation not having a material adverse effect on our business
(Note 10);
in this Annual Report regarding:
• under “Our framework for growth,” our strategic plan, Walmart always
being aggressive on price and equipping customers with information
and technology to facilitate great customer service;
• in our Chief Executive Officer’s letter, driving sales growth by execut-
ing well in stores and e-commerce, our objective of running great
stores, clubs and e-commerce to grow our business, investment in
increased wages and other initiatives for our U.S. associates, our fresh
food offering and e-commerce innovations being future growth drivers
and generating increased shareholder value when we operate and grow
efficiently and our commitment to compliance, ethics and doing business
the right way;
• under “Delivering an improved shopping experience.,” in connection
with our Walmart U.S. segment, certain wage increases for U.S. associ-
ates, continuing to strengthen fresh departments, certain factors
ensuring a superior fresh offering to Walmart U.S.’s customers, addition
of items sold on walmart.com, continuing to work with supplier partners
to ensure everyday low cost and ensuring everyday low cost allowing
investment in and strengthening of the segment’s everyday low cost
pricing strategy and offering value to customers, the ranges of the num-
ber of units and amount of retail square feet to be added by Walmart
U.S. in fiscal 2016, and transparent pricing for customers occurring
through new tools and capabilities;
• under “Driving increased profitability through balanced growth.,” in
connection with our Walmart International segment, the segment stra-
tegically optimizing its global positioning across key geographies and
formats to maximize growth potential and its objective of strengthen-
ing customer trust with a focus on everyday low price, high quality fresh
food and excellent customer service;
• under “Creating a more rewarding member experience.,” in connec-
tion with our Sam’s Club segment, Sam’s Club’s goal of having a suite
of business member services making membership in Sam’s Club such
members’ most valuable business card and the range for the number
of new and relocated clubs to be opened, and the number of clubs to
be remodeled, in fiscal 2016; and
• under “A solid FY 15 performance; investing for a stronger future,”
currency exchange rates possibly continuing to be a headwind to
operating results in fiscal 2016, the range of net retail square footage
we will add in fiscal 2016, Walmart enabling customers to shop any-
time and anywhere, incremental e-commerce investment in fiscal
2016 and Walmart continuing to seek the right balance between sales
growth and profitability as we grow our e-commerce business and
the investment in wages and other initiatives for U.S. associates lead-
ing to higher sales and returns.
The forward-looking statements described above are identified by the
use in such statements of one or more of the words or phrases “aim,”
“anticipate,” “could be,” “could reduce,” “estimated,” “expansion,” “expect,”
“goal,” “grow,” “intend,” “investment,” “is expected,” “may cause,” “may
continue,” “may fluctuate,” “may impact,” “may not be,” “may result,”
“objective,” “plan,” “priority is to,” “projected,” “should continue,” “more to
come,” “we’ll,” “we’ll accomplish,” “we’ll also equip,” “we’ll always be,”
“we’ll continue,” “we’ll drive,” “we’ll generate,” “we’ll reinvent,” “will add,”
“will allow,” “will be,” “will be met,” “will be paid,” “will continue,” “will
depend,” “will ensure,” “will have,” “will impact,” “will include,” “will
increase,” “will open,” “would be,” and “would increase,” variations of
such words and phrases and other similar words or phrases.
The forward-looking statements included in this Annual Report and that
we make elsewhere are subject to certain risks, factors and uncertainties
that could materially affect our actual results and the realization of our
objectives and plans. These risks, factors and uncertainties include, but
are not limited to:
Risks, Factors and Uncertainties Relating to the Markets in which
We Operate
• economic, geo-political, financial markets, capital markets and business
conditions, changes, trends and events globally and in one or more of
the markets in which we operate;
• unemployment and underemployment levels globally and in one or
more of the markets in which we operate;
• monetary policies of the U.S. government, the Board of Governors of
the Federal Reserve System, other governments or central banks, eco-
nomic or sovereign debt crises and disruptions in the financial markets;
• supply of and demand for particular commodities and commodity
prices, including the prices of crude oil, natural gas, refined petroleum
products and electricity;
• inflation and deflation;
• currency exchange rate fluctuations and volatility;
• fluctuations in market rates of interest;
• market labor costs in the U.S.;
• market selling prices of gasoline and diesel fuel;
• competitive initiatives of other retailers, other competitive pressures
and new competitors entering a market;
• adoption of or changes in tax, labor and other laws and regulations
and interpretations thereof that affect our business, including
changes in corporate and personal tax rates and the imposition
of new taxes and surcharges;