Nov 22, 2008

Business - Wal-Mart names Mike Duke as CEO

NEW YORK (AFP) – Wal-Mart, the retail sector leader that has weathered the economic crisis better than most of its peers, announced Friday that Mike Duke will take over as chief executive to replace retiring Lee Scott.

Duke, 58, who has been a vice chairman heading the company's international operations, will take over February 1 as president and chief executive officer of the deep-discounting retail giant.

"This management change occurs at a time of strength and momentum for Wal-Mart," said Rob Walton, chairman of the board of directors.

"Mike Duke is a highly respected executive both domestically and internationally, with broad experience throughout the company, having successfully led Wal-Mart's Logistics Division, US operations, and international operations," said Walton.

"He understands retail and appreciates the complex global environment in which we operate. He is committed to the culture of Wal-Mart, its mission, and to our associates and customers. He has built strong teams wherever he has led."

Scott will continue serving as chairman of the executive committee of the board.

Duke has headed Wal-Mart's international operations, helping it grow to over 3,200 stores in 14 markets outside the continental United States.

As a stand alone business, Wal-Mart International would be one of the biggest global retailers, with annual sales projected to reach almost 100 billion dollars this year, according to Wal-Mart.

The division includes operations in Argentina, Brazil, Canada, China, Costa Rica, El Salvador, Guatemala, Honduras, Japan, Mexico, Nicaragua, Puerto Rico and Britain and, through a joint venture, in India.

"I am looking forward to leading this great company," Duke said in the statement.

"Wal-Mart is very well positioned in today's economy, growing market share and returns, and is more relevant to its customers than ever. Our strategy is sound and our management team is extremely capable. I am confident we will continue to deliver value to our shareholders, increase opportunity for our over two million associates, and help our 180 million customers around the world save money and live better."

Wal-Mart has weathered the recent economic turmoil better than most of its rivals. Its most recent quarterly profits rose 9.8 percent, although it warned of upcoming weakness in part due to a stronger dollar.

Analysts at said the company has held strong in Scott's nine-year tenure as CEO.

"Although there were some disgruntled shareholders during Scott's tenure, Wal-Mart's stock has outperformed the market since his appointment in January 2000 -- slipping 15.8 percent compared to the S&P 500's decline of 29.5 percent, both including dividends, as of November 14," they wrote.

John Ogg at 24/7 Wall Street said Scott's performance was lackluster.

"Wal-Mart Stores is doing what we believe they should have done two-years ago," he said.

"Lee Scott was one of our CEO's to go, but that was for 2007. He was essentially bailed out by the recession because the stock never performed well under him during the bull market."

Wal-Mart shares rose 1.2 percent to 51.27 dollars in early trade.

Prior to joining Wal-Mart in 1995, Duke had 23 years of experience in retailing with Federated Department Stores and May Department Stores.

Duke graduated from Georgia Tech with a bachelor's degree in industrial engineering. He serves on the board of the US-China Business Council.

The board also approved the promotion of Eduardo Castro-Wright, 53, to vice chairman, effective immediately

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