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Last Updated: Wednesday, 17 May 2006, 12:11 GMT 13:11 UK
Wal-Mart earnings top forecasts
Wal-Mart price labels
After difficult quarters, Wal-Mart hopes to have investors smiling
Wal-Mart, the world's biggest retailer, has seen better-than-expected earnings lifted by new products, cost cutting and better management of its supplies.

Net profits rose 6% to $2.6bn (1.4bn), or 63 cents per share, in the first quarter ending 30 April. Sales rose 12.3% to $79.61bn from a year earlier.

However, the good news was accompanied by a warning that high energy costs may eat into the current quarter's profits.

Wall-Mart sees second-quarter profits of between 70 cents and 74 cents.

'Best in years'

"We continue to see higher gasoline and utility prices affecting our customers around the world," said Lee Scott, Wal-Mart's chief executive officer.

Wal-Mart has been revamping its business as it faces increased competition from rivals including retailer Target.

As part of its plans to boost business, Wal-Mart has been renovating its shops, adding better quality products, and even mulling a significant move into organic food retailing.

The company also has been focusing on greater supply chain efficiency.

"US Wal-Mart had its best operating performance in six years," said Bernard Sosnick, an analyst at Oppenheimer & Co.


SEE ALSO:
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