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Walmart confirms Sam’s Club closings

Walmart officially confirmed it is reducing its Sam’s Club real estate portfolio.

The discounter announced it will close 63 Sam’s Club stores across the United States, with the balance of the facilities closing during the next few weeks. The closings will leave the company with 597 Sam’s Clubs locations.

In addition, Walmart said it will convert up to 12 of the impacted clubs to e-commerce fulfillment centers in a move designed to speed delivery of online orders. The first of the converted online fulfillment centers will be located in Memphis, Tennessee.

Walmart said the decision to close the clubs came after a thorough performance review.

“Transforming our business means managing our real estate portfolio and Walmart needs a strong fleet of Sam’s Clubs that are fit for the future,” said John Furner, president and CEO of Sam’s Club. “We know this is difficult news for our associates and we are working to place as many of them as possible at nearby locations.”

Walmart said it will provide support and resources to those associates who are affected, including the bonus announced on Thursday and 60 days of pay, as well as severance to those eligible.

“We need great people to help lead us into the future and we hope that many of them will stay with the company at either a local store or club,” Furner said. “Change is never easy, but we’re making these decisions as part of running a healthy business.”

The company will record a “discrete” charge of approximately $0.14 per share related to these actions, with the vast majority of this in its fourth quarter. Further details will be shared, as appropriate, when the company releases quarterly results on February 20, 2018.
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