2009 ANNUAL REPORT United States ★ 3,656 Stores Sam’s Club ★ 602 U.S. Clubs More opportunities around the world to save money and live better. W a l- M a r t 2 0 0 9 A n n u a l R e p o Argentina ★ 28 Units Brazil ★ 345 Units Canada ★ 318 Units Chile ★ 197 Units China ★ 243 Units rt Costa Rica ★ 164 Units El Salvador ★ 77 Units Guatemala ★ 160 Units Honduras ★ 50 Units India ★ 24 Units* Japan ★ 371 Units Mexico ★ 1,197 Units Nicaragua ★ 51 Units Puerto Rico ★ 56 Units United Kingdom ★ 358 Units Unit counts as of January 31, 2009. *India retail locations are owned and operated by Bharti Retail. Wal-Mart India provides technical support to these stores through a franchise agreement. Wal-Mart Stores, Inc. 702 S.W. 8th Street Bentonville, Arkansas 72716 USA 479-273-4000 walmartstores.com Now more than ever. Executive Officers 2009 2008 2007 2006 2005 (In billions, except per share data) Financial Net sales(1) $401.2 $3E7d4u.3ar do Castro-Wright $344.8 Michael T. Duke $308.9 Thomas M$.2 S8ch1o.5ewe Vice Chairman, Wal-Mart Stores, Inc., President and Chief Executive Offi cer Executive Vice President and Net sales increase 7.2% 8.6% 11.6% 9.8% 11.4% responsible for the Walmart U.S. Division Chief Financial Offi cer Rollin L. Ford Operating income(1) $ 22.8 $ M22. S.0u san Chambers $ 20.5 Executive Vice President, C$hie1f In8fo.r7m ation Offi cer H. Lee Sco$tt,1 J7r..3 Highlights Executive Vice President, People Division Chairman of the Executive Committee of Earnings per share(2) $ 3.35 $ 3.16 $ 2.92 Thomas D. Hyde $ 2.72 $ 2.46 the Board of Directors Brian C. Cornell Executive Vice President, Legal, Ethics and Dividend per share(3) $ 0.95 $ E0xe.8cu8tiv e Vice President, President an$d 0.67 Corporate Secretary $ 0.60 S. Robson$ W0al.t5o2n Chief Executive Offi cer, Sam’s Club Division Chairman of the Board of Directors C. Douglas McMillon (1) Financial information for fi scal years 2006, 2007 and 2008 has been restated to refl ect the impact Leslie A. Dach Executive Vice President, President and Steven P. Whaley of the following activities in fi scal 2009: Executive Vice President, Corporate Aff airs Chief Executive Offi cer, International DTiwviseiolvne MonthSesn Eionrd Veicde President and Controller • The closure and disposition of 23 stores and other properties of The Seiyu, Ltd. (“Seiyu”) in Japan under a restructuring plan; and (Amoaunndt sG ionv merinllimonesn)t Relations January 31, 2009 January 31, 2008 • The sale of Gazeley Limited (“Gazeley”), a property development subsidiary in the United Kingdom. Financial information for fi scal year 2005 has not been restated to refl ect the impact of these Net cash provided by operating activities $23,147 $20,642 activities, as the adjustments are immaterial. Financial information for fi scal years 2005 and 2006 has been restated to refl ect the disposition Payments for property and equipment (11,499) (14,937) of our South Korean and German operations that occurred in fi scal 2007. Now More (2) Diluted income per common share from continuing operations. Free cash flow $11,648 $5,705 (3) Annual dividend declared for fi scal year 2010 is $1.09. Than Ever Online “ My Dad created Wal-Mart to help people save money so they can have a better life. This mission remains as relevant now as it was in 1962.” We are committed to reducing our paper usage. Please help us by visiting Rob Walton, Chairman of the Board walmartstores.com/investors to register for electronic delivery of Annual Shareholders’ Meeting materials and other Company information. While online, we also invite you to learn more about Wal-Mart’s progress towards becoming a more sustainable company. In the second quarter we will publish Sam Walton, Founder an online version of our 2009 Global Sustainability Report. A condensed, executive summary highlighting our economic, environmental and social performance is Now More Than Ever available online now at walmartstores.com/sustainability. Wal-Mart is There for A More Responsible Annual Report Total environmental savings impact: In line with our commitment to sustainability, our Annual Report Savings baselines were developed using the national averages of similar coated papers Customers and Members. was created using environmentally and socially responsible and printing practices by EarthColor Printing. manufacturing practices. The Report was printed using Forest 1 acre of forestland preserved via managed forestry More than 40 years ago, our founder Sam Walton, understood people needed to save money Stewardship Council-certifi ed paper and renewable wind energy. 562 fewer trees consumed via recycling so they could live better. Today, this mission is more important than ever to our customers and Additional sustainable practices included the recycling of 114,041 kWh less energy – the same used by 5 homes for a year members around the world. We work hard every day in all our markets to deliver on this promise. residual materials and using reduced-VOC inks and coatings. 608 metric tons of greenhouse gas offset – the equivalent of taking 122 cars off the road for a year We operate with the same level of integrity and respect that Mr. Sam put in place. It is because 204,979 fewer gallons of water consumed of these values and culture that Wal-Mart continues – now more than ever – to make a diff erence 17,024 kWh converted to clean renewable sources in the lives of our customers, members and associates. (printing plant using REC’s) ©2009 Wal-Mart Stores, Inc. All rights reserved. 2008 2007 2006 2005 $374.3 $344.8 $308.9 $281.5 8.6% 11.6% 9.8% 11.4% $ 22.0 $ 20.5 $ 18.7 $ 17.3 $ 3.16 $ 2.92 $ 2.72 $ 2.46 $ 0.88 $ 0.67 $ 0.60 $ 0.52 Twelve Months Ended (Amounts in millions) January 31, 2009 January 31, 2008 Net cash provided by operating activities $23,147 $20,642 Payments for property and equipment (11,499) (14,937) Free cash flow $11,648 $5,705 “ Our Company is so well positioned for today’s diffi cult economy and tomorrow’s changing world. We have an exceptionally strong management team, able to execute our strategy, perform every single day, and deliver results.” Michael T. Duke To Our Shareholders, Associates and Customers: I’m fortunate to have assumed We have so much to be proud of at to be in the warehouse club segment. my new role as president and chief Wal-Mart when it comes to last year’s Sam’s Club grew sales 5.6 percent executive officer at this time in fi nancial results. Earnings per share for the year, and is further strength- Wal-Mart’s history. Our Company is from continuing operations were up ening the member experience. so well positioned for today’s diffi cult 6 percent to $3.35. We delivered economy and tomorrow’s changing strong returns to our shareholders Continued Focus on ROI world. We have an exceptionally through almost $7.3 billion in share Our team is very focused on working strong management team, able to repurchases and dividends. Total to improve return on investment (ROI). execute our strategy, perform every net sales increased 7.2 percent, as we Our capital effi ciency process drives single day, and deliver results. This helped customers save money, so expansion decisions. The Company success is a tribute to the hard work they can live better. has stepped up investments in tech- of many people, but especially Lee nology to maintain leadership in an Scott. We appreciate Lee for his ser- Operating Segments Deliver area that always has been a driver vice and outstanding leadership of Strong Performance of our success. These efforts will our Company. Each operating segment stepped contribute to Wal-Mart’s increased At Wal-Mart, we’re very pleased with up and contributed to our strong effi ciency through our use of capital, last year’s annual performance, espe- performance. Walmart U.S. had an technology and logistics. cially relative to competitors. Our U.S. extraordinary year by driving home The fact is, Wal-Mart’s performance stores are delivering faster checkouts, our price message and driving up last year would be considered strong a friendlier shopping experience and customer experience scores to record at any time and for any retailer, and cleaner presentations. Simply, they levels. At Wal-Mart International, certainly during one of the most diffi - are just operating better. We are on currency fl uctuations aff ected our cult global economies in decades. the move internationally and today reported sales, but overall results This tremendous success is a real have more stores in more markets. were solid. Doors continue to open tribute to our culture and every one People who have never shopped with for international growth, such as of our 2.1 million associates around us previously are now loyal customers. with our strategic acquisition of the world. Retail was tested this past Sam’s continues to show the distinct Distribución y Servicio – D&S – in Chile. year, and our associates made the value of club membership. This also continues to be a great time diff erence for Wal-Mart shareholders. 2 Wal-Mart 2009 Annual Report Already this year, the global economy lower costs and provide savings to our continues to be challenging. But even customers. There will be no part of “ …we obsess about our with this uncertainty, we’re optimistic this Company anywhere in the world customers and ways to about Wal-Mart’s opportunity, because that does not contribute to making serve them better than we are so well positioned. Our custom- Wal-Mart more sustainable. ers expect us to off er the lowest prices. One way is through responsible ever before.” We simply cannot forget that what we sourcing. Last year, I stood in front of do makes a diff erence in their lives. more than 1,000 suppliers in Beijing, China and committed our Company replace the carpet, furniture, or even Price Leadership Drives to building a more socially and envi- Sam Walton’s old wood paneling. With Global Performance ronmentally responsible supply chain. the exception of a couple of pictures There’s no doubt that we are We’ll make a diff erence in responsible on the wall, we kept it as the same bringing to life our global vision for sourcing that no other retailer and no office in which Sam Walton, David Wal-Mart. Our strategy is working, other company can make. Glass and Lee Scott made the deci- and we’re building more and more sions that built our great Company. momentum. We will maintain our Job Creation and Advancement I could not be more honored or more focus on price leadership in every We’re also off ering opportunities for humbled to sit at their desk now. market, whether we’re talking to the associates. Last year, Wal-Mart created Although there will continue to be working mom in São Paulo or the 33,000 jobs in the United States and many changes at Wal-Mart, there is businessman in Tokyo. thousands more in our other markets. one thing that will never change – our As vice chairman responsible for These good jobs offer competitive culture. Wal-Mart associates operate Wal-Mart International, I saw first- wages and benefi ts and the oppor- with honesty and integrity. We respect hand how much our business model tunity to advance. We plan to create people as individuals and strive for resonates around the world. I make tens of thousands of jobs again this excellence. And, most important, we it a habit not only to walk our stores, year. And, we’ll continue to be a force obsess about our customers and ways but also to visit our customers in for inclusiveness everywhere we to serve them better than ever before. their homes. I remember one woman’s operate. We need our associates I’m certain of our strategy, our tiny house in Costa Rica. She told more than ever. opportunity and our ability to perform me that everything she needs is at We will find ways to make a as individuals and as a Company. By our Pali store. We owe every cus- diff erence through our participation executing well and adhering to our tomer our very best – lower prices, in debates on issues, including energy, values, we plan to distance ourselves higher-quality goods and a better health care and trade. At Wal-Mart, even further from the competition and store experience. we won’t sit back and say, “That’s do even more to “save people money We also must continue assuming the someone else’s job.” We have a role to so they can live better.” larger role that Lee helped us realize play. Wal-Mart has great relationships we can play in the world. People have with governmental leaders in many been asking me, “Mike, during these countries around the world. Whether, diffi cult times, can we aff ord to do for example, it’s with Democrats or things like sustainability, responsible Republicans, or President Obama’s Michael T. Duke sourcing, associate opportunity and new administration, Wal-Mart will President and Chief Executive Offi cer, health care?” Every time my response play a role. Wal-Mart Stores, Inc. has been, “We can’t aff ord not to.” At My fi rst day in the new job fell on Wal-Mart, we have an opportunity and the fi rst Sunday in February. So my a responsibility to lead in the world. wife Susan and I took a few hours to Sustainability is a permanent part of move some boxes and belongings our culture. It helps us remove waste, into my new office. But we didn’t Wal-Mart 2009 Annual Report 3 Now More Than Ever at Walmart U.S. Save money. Live b Strong Growth: Net sales increased Improved Customer Experience: We 6.8 percent to $255.7 billion, while ended the year with more than 3,600 stores segment operating income grew in 50 states. Between remodels and new 7.1 percent to $18.8 billion. stores, we plan to update approximately HIGHLIGHTS 700 stores this year to improve the customer experience and drive sales. 4 Wal-Mart 2009 Annual Report better. ® This is an exciting time at Walmart, as we are seeing more and more families across the United States trust Walmart’s promise to help them save money so they can live better. Now more than ever, the entire organization is fully aligned to stand by this promise every day. Consumers faced increasing challenges and uncertainties throughout the year. Our commitment to price leadership helped them save money when they needed it the most, which drove signifi cant increases in store traffi c. More people shopped at Eduardo Castro-Wright Walmart U.S. this year than ever before. More customers also shopped online during Vice Chairman, the year and their use of our Site to Store® free delivery service led to a record year for Wal-Mart Stores, Inc., sales with this program. responsible for the We continue to build credibility and authority as the destination for many products Walmart U.S. Division customers want and need. Our assortments emphasize categories in which the Walmart brand has authority, where we can off er a full line of products and realize scale advan- tages. We began to integrate our global sourcing capabilities with the merchandise units in our three operating segments to accrue benefi ts – from improved product quality to cost effi ciencies – that will strengthen our value proposition around the world. Walmart surveys hundreds of thousands of customers monthly, asking them to rate their shopping experience. By year-end, the scores reflected record-high levels of satisfaction. Our faster checkouts, friendlier associates and cleaner stores are bringing more customers to our stores and driving increases in same-store traffi c. We are remodeling our stores, making them easier to shop, and leveraging technology to ensure increased operational efficiencies. The initial customer response to our Project Impact store remodeling plan has been positive. Under this plan, we expect to update approximately 700 new and existing stores this year. Our logistics team implemented a number of productivity initiatives in warehouse handling and transportation. We passed along these savings to our customers through lower prices. Walmart reduced inventory levels from the prior year, a tremendous achievement, and one that exceeded our goal of growing inventory at half the rate of sales growth. The combination of lower inventory and improvements in merchandise quality and presentation is contributing to a better customer experience and stronger fi nancial performance. These achievements, along with our disciplined capital allocation process, helped Walmart U.S. fi nish the year with a solid improvement in return on investment. It is a credit to all Walmart associates across the country that we had such a successful year. We are dedicated to providing associates with opportunities that offer good jobs, complemented by a revitalized training and development program that facilitates career growth. Our associates are energized by last year’s results, but more importantly, by the opportunities that all of us see in the future. Fast, Friendly, Clean: Our promise of fast More Brands Than Ever: Walmart U.S. Net Sales $255.7 billion checkout, friendly associates and clean continues to increase its offerings of Operating Income $ 18.8 billion stores drove increases in customer experi- top brands for less, including Sony®, Number of Units 3,656* ence scores throughout 2008 to reach Samsung®, Dell®, Nintendo®, Garmin®, *As of 1/31/09 record levels by the end of the year. Dyson®, KitchenAid®, Chicago Cutlery®, L.e.i.®, Danskin Now® and Starter®. Wal-Mart 2009 Annual Report 5 Now More Than Ever at Wal-Mart International ONE GLOBAL FOCUS U At Wal-Mart International, we operate in 15 markets, but our focus is quite singular – deliver price leadership to customers. “Save money, live better” may translate into many languages where Wal-Mart operates, but our message behind the mission is universal. We continue to build on the strategic framework that has driven consistent growth. For Wal-Mart to continue to win in all markets, it is essential that each format is focused on the every day low cost – every day low price (EDLC-EDLP) strategy. Customers around the world are looking for value. Our country leaders are focused on continuing to improve productivity and managing costs that enable price leadership. C. Douglas McMillon Executive Vice President, We continue to learn from successes across countries and apply best practices to fi ne-tune President and Chief Executive Offi cer, product off erings, store formats and price points to meet our customers’ needs. This has International Division enabled many of our countries to grow sales faster than the overall growth of their respective markets – evidence that our strategy of winning in every market is working. Clearly, helping customers save money is leading to increased sales, increased profi t and improved return on investment, or ROI, for our Wal-Mart International businesses. Improving ROI starts with profi table growth and is aided by our capital effi ciency focus. We also are building stores that require less capital, and that further adapt to our customers’ needs. Another area improving returns is our private brands. As we expand private brands around the world, we provide price leadership and value to our customers. Extra Special, for example, has long been a well-recognized brand at ASDA in the United Kingdom. Extra Special is now sold in Superama supermarkets in Mexico. Since 1993, Great Value® has been a recognized Walmart brand in the United States. Customers in many of our international markets also fi nd the Great Value® brand on their grocery shelves, and they appreciate the savings and quality that it off ers. As we strengthen our global sourcing and procurement capabilities, we are dedicated to improving product quality, sustainability, and leveraging our scale to achieve lower costs – a positive for both customers and shareholders. Our associates are proud to be part of the Wal-Mart family and are obsessed with serving our customers. When we deliver both service and value, customers trust us more. It is our leaders’ responsibility to make sure associates understand how the Wal-Mart values and culture translate to that level of trust, to their personal performance in serving customers and to the Company’s overall success. Respect for the individual, for example, leads to better customer service by creating a sense of urgency and strengthening listening skills. When associates embrace this concept, we are successful. The expansion of the Wal-Mart culture around the world is truly a case of leading by example. Sam Walton set those examples himself as he lived with respect and integrity. These values help us deliver on our goal to improve returns in every market where we operate. Consistent Growth: Segment sales Winning in the U.K.: ASDA recorded grew 9.1 percent to $98.6 billion. Segment 11 consecutive quarters of year-over-year INTERNATIONAL operating income rose 4.6 percent to sales growth, outperforming the total $4.9 billion. Results included negative market in the process. HIGHLIGHTS impact from currency valuations. 6 Wal-Mart 2009 Annual Report S UNITES ALL MARKETS. United Kingdom Mexico Brazil Expanding in Asia: We opened a Hong New Market: Wal-Mart entered Chile Net Sales $98.6 billion Kong regional office to facilitate long-term through the acquisition of a controlling Operating Income $ 4.9 billion opportunities in Asia, to support existing interest in Distribución y Servicio (D&S), Number of Units 3,615* operations in Japan, China and India, and Chile’s largest food retailer. * As of 1/31/09, does not include Bharti Retail locations in India to further build our leadership team. Wal-Mart 2009 Annual Report 7 Now More Than Ever at Sam’s Club VALUE DRIVES CLUB M Solid Performance: Sam’s Club finished Sustainability-Focused Products: fiscal year 2009 with net sales of $46.9 bil- Home efficiency aisles in clubs display lion, an increase of 5.6 percent. Segment products and appliances that improve operating income for the year was energy efficiency and water conservation HIGHLIGHTS $1.6 billion. to help members be more eco-friendly and save money. 8 Wal-Mart 2009 Annual Report