Global retail giant Walmart has trimmed its fourth-quarter profit guidance by 10 cents a share after scrapping a six-year venture with Bharti Retail in India and closing 50 stores in Brazil and China.
"Two items impact our guidance by approximately $0.10 per share. The net impact (of scrapping the India venture) is expected to be dilutive to earnings per share by approximately $0.04," Walmart said in a statement on Thursday.
Walmart said it expected fourth quarter earnings per share (EPS) to be in the range of $1.50 to $1.60.
The US retail giant has sought clarifications about local sourcing norms for foreign players after the Indian government allowed foreign direct investment of 51 per cent in multi-brand retailing in September last year.
On October 9, Walmart and Bharti Enterprises announced that they were parting ways in India.
The companies agreed to independently own and operate separate business formats and discontinue their franchise agreement in the retail business.
Walmart will buy out its Indian partner in their 50:50 joint venture Bharti Walmart, which runs 20 Best Price Modern Wholesale stores, for an undisclosed sum.
Bharti will acquire $100 million of compulsory convertible debentures held by Walmart in Cedar Support Services, a company owned and controlled by the Indian firm. It will run its 'Easyday' retail stores on its own.
The two partners joined hands in 2007 and launched their first Best Price Modern Wholesale store in Amritsar in 2009.
Walmart on Thursday reported Q3 EPS of $1.14 as net sales revenue increased 1.6 per cent to $114.9 billion.