Walmart Inc. (WMT)

Walmart estimates the expected term of a lease by assuming the exercise of renewal options where an economic penalty exists that would preclude the abandonment of the lease at the end of the initial non-cancelable term and the exercise of such renewal is at the sole discretion of Walmart. The expected term is used in the determination of whether a store or club lease is a capital or operating lease and in the calculation of straight-line rent expense. Additionally, the useful life of leasehold improvements is limited by the expected lease term or the economic life of the asset, whichever is shorter. If significant expenditures are made for leasehold improvements late in the expected term of a lease and renewal is reasonably assured, the useful life of the leasehold improvement is limited to the end of the renewal period or economic life of the asset, whichever is shorter. Rent abatements and escalations are considered in the calculation of minimum lease payments in Walmart’s capital lease tests and in determining straight-line rent expense for operating leases.

Walmart is often involved in the construction of its leased stores. In certain cases, payments made for certain structural components included in the lessor’s construction of the leased assets result in Walmart being deemed the owner of the leased assets for accounting purposes. As a result, the payments, regardless of the significance, are automatic indicators of ownership and require Walmart to capitalize the lessor’s total project cost with a corresponding financing obligation. Upon completion of the lessor’s project, Walmart performs a sale-leaseback analysis to determine if these assets and the related financing obligation can be derecognized from Walmart’s Consolidated Balance Sheets. If Walmart is deemed to have "continuing involvement," the leased assets and the related financing obligation remain on Walmart’s Consolidated Balance Sheets and are generally amortized over the lease term. At the end of the lease term, including exercise of any renewal options, the net remaining financing obligation over the net carrying value of the fixed asset will be recognized as a non-cash gain on sale of the property.

Source: 10-K (filing date: 2018-03-30).

Walmart Inc., future operating lease payments

		Jan 31, 2018	Jan 31, 2017	Jan 31, 2016	Jan 31, 2015	Jan 31, 2014	Jan 31, 2013
	Total undiscounted future operating lease payments (USD $ in millions)
	Discount rate1
	Total present value of future operating lease payments (USD $ in millions)

Based on: 10-K (filing date: 2018-03-30), 10-K (filing date: 2017-03-31), 10-K (filing date: 2016-03-30), 10-K (filing date: 2015-04-01), 10-K (filing date: 2014-03-21), 10-K (filing date: 2013-03-26).

2018 Calculations

Year	Future operating lease payments (as reported)	Year	Future operating lease payments (estimated)	Present value at
2019		2019
2020		2020
2021		2021
2022		2022
2023		2023
2024 and thereafter		2024
		2025
		2026
		2027
		2028
		2029
		2030
Total:

Based on: 10-K (filing date: 2018-03-30).

2017 Calculations

Year	Future operating lease payments (as reported)	Year	Future operating lease payments (estimated)	Present value at
2018		2018
2019		2019
2020		2020
2021		2021
2022		2022
2023 and thereafter		2023
		2024
		2025
		2026
		2027
		2028
		2029
		2030
Total:

Based on: 10-K (filing date: 2017-03-31).

2016 Calculations

Year	Future operating lease payments (as reported)	Year	Future operating lease payments (estimated)	Present value at
2017		2017
2018		2018
2019		2019
2020		2020
2021		2021
2022 and thereafter		2022
		2023
		2024
		2025
		2026
		2027
		2028
		2029
		2030
Total:

Based on: 10-K (filing date: 2016-03-30).

2015 Calculations

Year	Future operating lease payments (as reported)	Year	Future operating lease payments (estimated)	Present value at
2016		2016
2017		2017
2018		2018
2019		2019
2020		2020
2021 and thereafter		2021
		2022
		2023
		2024
		2025
		2026
		2027
		2028
		2029
Total:

Based on: 10-K (filing date: 2015-04-01).

2014 Calculations

Year	Future operating lease payments (as reported)	Year	Future operating lease payments (estimated)	Present value at
2015		2015
2016		2016
2017		2017
2018		2018
2019		2019
2020 and thereafter		2020
		2021
		2022
		2023
		2024
		2025
		2026
		2027
		2028
Total:

Based on: 10-K (filing date: 2014-03-21).

2013 Calculations

Year	Future operating lease payments (as reported)	Year	Future operating lease payments (estimated)	Present value at
2014		2014
2015		2015
2016		2016
2017		2017
2018		2018
2019 and thereafter		2019
		2020
		2021
		2022
		2023
		2024
		2025
		2026
Total:

Based on: 10-K (filing date: 2013-03-26).

Walmart Inc., adjustments to financial data

USD $ in millions

		Jan 31, 2018	Jan 31, 2017	Jan 31, 2016	Jan 31, 2015	Jan 31, 2014	Jan 31, 2013
	Adjustment to Total Assets
	Total assets (as reported)
	Add: Operating leased assets1
	Total assets (adjusted)
	Adjustment to Total Debt
	Total debt (as reported)
	Add: Operating lease obligations2
	Total debt (adjusted)
	Adjustment to Earnings before Interest and Tax (EBIT)
	EBIT3 (as reported)
	Add-back: Rentals under operating leases and other short-term rental arrangements
	Less: Depreciation expense, operating leased assets4
	EBIT (adjusted)
	Adjustment to Interest Expense, Debt, Capital Lease And Financing Obligations
	Interest expense, debt, capital lease and financing obligations (as reported)
	Add: Interest expense, operating lease obligations5
	Interest expense, debt, capital lease and financing obligations (adjusted)

Based on: 10-K (filing date: 2018-03-30), 10-K (filing date: 2017-03-31), 10-K (filing date: 2016-03-30), 10-K (filing date: 2015-04-01), 10-K (filing date: 2014-03-21), 10-K (filing date: 2013-03-26).

Walmart Inc., Financial Data: Reported vs. Adjusted

Walmart Inc., adjusted ratios

		Jan 31, 2018	Jan 31, 2017	Jan 31, 2016	Jan 31, 2015	Jan 31, 2014	Jan 31, 2013
	Total Asset Turnover1
	Reported total asset turnover
	Adjusted total asset turnover
	Debt to Equity2
	Reported debt to equity
	Adjusted debt to equity
	Return on Assets3 (ROA)
	Reported ROA
	Adjusted ROA
	Interest Coverage4
	Reported interest coverage
	Adjusted interest coverage

Based on: 10-K (filing date: 2018-03-30), 10-K (filing date: 2017-03-31), 10-K (filing date: 2016-03-30), 10-K (filing date: 2015-04-01), 10-K (filing date: 2014-03-21), 10-K (filing date: 2013-03-26).

Walmart Inc., Ratios: Reported vs. Adjusted

		Jan 31, 2018	Jan 31, 2017	Jan 31, 2016	Jan 31, 2015	Jan 31, 2014	Jan 31, 2013
	As Reported
	Selected Financial Data (USD $ in millions)
	Net sales
	Total assets
	Ratio
	Total asset turnover1
	Adjusted for Operating Leases
	Selected Financial Data (USD $ in millions)
	Net sales
	Adjusted total assets
	Ratio
	Adjusted total asset turnover2

Based on: 10-K (filing date: 2018-03-30), 10-K (filing date: 2017-03-31), 10-K (filing date: 2016-03-30), 10-K (filing date: 2015-04-01), 10-K (filing date: 2014-03-21), 10-K (filing date: 2013-03-26).

2018 Calculations

		Jan 31, 2018	Jan 31, 2017	Jan 31, 2016	Jan 31, 2015	Jan 31, 2014	Jan 31, 2013
	As Reported
	Selected Financial Data (USD $ in millions)
	Total debt
	Total Walmart shareholders’ equity
	Ratio
	Debt to equity1
	Adjusted for Operating Leases
	Selected Financial Data (USD $ in millions)
	Adjusted total debt
	Total Walmart shareholders’ equity
	Ratio
	Adjusted debt to equity2

Based on: 10-K (filing date: 2018-03-30), 10-K (filing date: 2017-03-31), 10-K (filing date: 2016-03-30), 10-K (filing date: 2015-04-01), 10-K (filing date: 2014-03-21), 10-K (filing date: 2013-03-26).

2018 Calculations

		Jan 31, 2018	Jan 31, 2017	Jan 31, 2016	Jan 31, 2015	Jan 31, 2014	Jan 31, 2013
	As Reported
	Selected Financial Data (USD $ in millions)
	Consolidated net income attributable to Walmart
	Total assets
	Ratio
	ROA1
	Adjusted for Operating Leases
	Selected Financial Data (USD $ in millions)
	Consolidated net income attributable to Walmart
	Adjusted total assets
	Ratio
	Adjusted ROA2

Based on: 10-K (filing date: 2018-03-30), 10-K (filing date: 2017-03-31), 10-K (filing date: 2016-03-30), 10-K (filing date: 2015-04-01), 10-K (filing date: 2014-03-21), 10-K (filing date: 2013-03-26).

2018 Calculations

		Jan 31, 2018	Jan 31, 2017	Jan 31, 2016	Jan 31, 2015	Jan 31, 2014	Jan 31, 2013
	As Reported
	Selected Financial Data (USD $ in millions)
	Earnings before interest and tax1 (EBIT)
	Interest expense, debt, capital lease and financing obligations
	Ratio
	Interest coverage2
	Adjusted for Operating Leases
	Selected Financial Data (USD $ in millions)
	Adjusted EBIT
	Adjusted interest expense, debt, capital lease and financing obligations
	Ratio
	Adjusted interest coverage3

Based on: 10-K (filing date: 2018-03-30), 10-K (filing date: 2017-03-31), 10-K (filing date: 2016-03-30), 10-K (filing date: 2015-04-01), 10-K (filing date: 2014-03-21), 10-K (filing date: 2013-03-26).

USD $ in millions

		Jan 31, 2018	Jan 31, 2017	Jan 31, 2016	Jan 31, 2015	Jan 31, 2014	Jan 31, 2013
	Rentals under operating leases and other short-term rental arrangements
	Less: Estimated interest expense, operating lease obligations1
	Estimated depreciation expense, operating leased assets

Based on: 10-K (filing date: 2018-03-30), 10-K (filing date: 2017-03-31), 10-K (filing date: 2016-03-30), 10-K (filing date: 2015-04-01), 10-K (filing date: 2014-03-21), 10-K (filing date: 2013-03-26).

		Jan 31, 2018	Jan 31, 2017	Jan 31, 2016	Jan 31, 2015	Jan 31, 2014	Jan 31, 2013
	Operating leased assets, at beginning of year1 (USD $ in millions)
	Discount rate2
	Estimated interest expense, operating lease obligations3 (USD $ in millions)

Based on: 10-K (filing date: 2018-03-30), 10-K (filing date: 2017-03-31), 10-K (filing date: 2016-03-30), 10-K (filing date: 2015-04-01), 10-K (filing date: 2014-03-21), 10-K (filing date: 2013-03-26).

		Jan 31, 2018	Jan 31, 2017	Jan 31, 2016	Jan 31, 2015	Jan 31, 2014	Jan 31, 2013
	Total present value of future operating lease payments1 (USD $ in millions)
	Rentals under operating leases and other short-term rental arrangements (USD $ in millions)
	Discount rate2
	Total present value of operating lease payments, at beginning of year3 (USD $ in millions)

Based on: 10-K (filing date: 2018-03-30), 10-K (filing date: 2017-03-31), 10-K (filing date: 2016-03-30), 10-K (filing date: 2015-04-01), 10-K (filing date: 2014-03-21), 10-K (filing date: 2013-03-26).