Wal-Mart Says Customers Shopped More, Boosts Dividend

Wal-Mart Stores Inc. customers made more trips to buy groceries, televisions and other products for entertaining at home last month, outpacing the retailer’s quarterly sales forecast. The company raised its annual dividend by 15 percent.

“Shopping trips had seen a significant decline back when gasoline prices were at record high levels,” Eduardo Castro- Wright, Wal-Mart’s head of U.S. stores, said in a Feb. 26 interview. “Now we’re seeing a reversal of that.”

Wal-Mart, the world’s biggest retailer, reported today that sales at U.S. stores open at least a year increased 5.1 percent in February, better than its prediction for 1 percent to 3 percent growth in the three months ending May 1. An increase in customer traffic drove the gains, Wal-Mart said in a statement.

Consumers’ biggest worry has shifted from gasoline prices, which have tumbled from a record in July, to “the fear of losing their jobs and being able to make payments on mortgages and credit-card balances,” Castro-Wright said.

Shoppers want to save money by eating in and are buying groceries, small appliances, cookware and “anything that has to do with the home,” he said last week from his office in Bentonville, Arkansas, where Wal-Mart is based.

Shares Jump

Wal-Mart advanced $2.33, or 4.8 percent, to $50.82 at 9:48 a.m. in New York Stock Exchange composite trading. Before today, the stock has declined 14 percent this year. Its 2008 advance of 18 percent outpaced the other 29 Dow Jones Industrial Average stocks.

The annual dividend will increase to $1.09 a share from 95 cents a share, Wal-Mart said today. The first of four quarterly dividends of 27.25 cents for the year ending Jan. 31 will be payable April 6 to shareholders of record March 13.

Wal-Mart said in a statement that the strength of its operations allowed the company to increase its dividend payment again this year.

Castro-Wright, 54, bases his consumer views on Wal-Mart’s monthly survey of 500,000 to 1 million shoppers and daily sales figures.

“You’ve got a trend toward financial responsibility,” Castro-Wright said. “It’s almost like a significant percentage of consumers realize that they might have been living beyond their real means.”

Credit Cards, Mortgages

Consumers fell behind on credit-card payments as U.S. unemployment reached 7.6 percent in January, the highest rate since 1992. Foreclosure filings have topped a quarter-million for 10 straight months, according to RealtyTrac Inc.

The average U.S. pump price for regular unleaded gasoline was $1.933 a gallon yesterday, down from a record $4.114 on July 17, according to the Web site of AAA, the nation’s largest motorist organization.

Americans who are able to splurge are buying flat-panel TVs and video games, another example of families staying at home, Castro-Wright said. Consumers are also buying “basic sporting goods -- not big sets of complicated, high-end, expensive fitness equipment, but very basic dumbbells,” he said.