Wal-Mart CEO apologizes for poor Oct. sales
Lee Scott says company isn't 'comfortable' with 1% sales increase in October; expects lower gas prices to help sales.
NEW YORK (CNNMoney.com) -- Wal-Mart CEO Lee Scott apologized to a gathering of analysts Tuesday, saying he wanted to correct perception that the company was "comfortable" with its soft October sales performance.
"I would apologize if anyone caused you believe this. We're not comfortable with a 1 percent comparable sales. We don't accept this as acceptable," Scott said as he wrapped up Wal-Mart's two-day analysts meeting in New Jersey.
Wal-Mart (Charts) on Monday said the retailer's sales at stores open at least a year - a key retail metric known as same-store sales - were currently tracking a 1 percent increase for the month. Wal-Mart has forecast sales to increase between 2 to 4 percent this month.
Scott said that while it was reasonable to expect that the subsequent retreat in gas prices would help to boost sales, that has not yet happened at Wal-Mart and at the company's Sam's Club warehouse club division.
"But as gas prices continue to level off, we will see stronger sales," Scott said. "Our expectations are to not expect to proceed with 1 percent comparable sales."
Indeed, the fourth-quarter holiday period is a crucial time for discounters like Wal-Mart, Target (Charts) as well as other department store and specialty merchants like J.C. Penney (Charts) and Gap (Charts) since it accounts for as much as 50 percent of these retailers' annual profits and sales.
Wal-Mart's already signaled that it intends to be very aggressive over the holidays. The retailer typically launches its holiday discounts on Nov. 1. However, Wal-Mart set the ball rolling earlier than usual when it announced steep discounts last month on more than 80 of this year's must-have toys.
Scott said he's especially confident about sales picking up in categories like consumables, health and beauty, basic apparel and toys heading into the gift-buying period.