Walmart is emerging from an alleged industry-wide bread price-fixing scandal no worse for wear, with a crucial fourth-quarter sales metric rallying the most in almost two years.

The Bentonville, Arkansas-based retailer said on Tuesday its total sales in this country rose 3.4 per cent in the three months ending January 31. Meanwhile, sales at stores that were open for more than a year rose 2.9 per cent, the strongest quarterly rally since the period ending April 29, 2016.

Canada's retail industry was shook to its core in December when Loblaw and George Weston fessed up to what they called "an industry-wide price-fixing arrangement" that inflated bread prices from 2001 to 2015. According to court documents that were recently released, the Competition Bureau believes Walmart was among the retailers - along with Sobeys, Metro and Giant Tiger - that were involved.

Walmart Canada has declined to comment on the price-fixing probe, with a spokesperson only saying the company takes its legal obligations very seriously.

The company didn't address the controversy on Tuesday, but the numbers spoke volumes. Beyond sales growth, Walmart said its market share in food, consumables, health and wellness rose 60 basis points while profitability slipped amid "price investments".

"In Canada, customers have responded well to strategic investments we’ve made in price and this is contributing to market share gains in key traffic driving categories ... The team in Canada continues to do a good job of leveraging learnings and best practices from our operations in the U.S. and applying them locally to improve the customer experience," said CEO Doug McMillon in prepared remarks.

Overall, Walmart Inc. delivered a disappointing annual profit forecast as its once-torrid e-commerce sales growth begins to decelerate and the U.S. tax overhaul provides less of a windfall than expected.

The world’s largest retailer expects earnings of US$4.75 to US$5 a share this fiscal year, excluding some items, compared with an average Wall Street estimate of US$5.13. Though Walmart’s sales last quarter topped projections, the results reflected a slowdown in online orders -- a key metric in its battle to fend off Amazon.com Inc.

Walmart’s adjusted earnings amounted to US$1.33 a share in the fiscal fourth quarter. That was short of analysts’ average projection of US$1.37.

Walmart said it’s still assessing the impact of last year’s federal tax changes -- legislation that’s expected to bring huge benefits to the nation’s retailers. For now, the company is recording a provisional benefit of US$207 million for the fourth quarter and full year.

At Walmart’s e-commerce unit, gross merchandise volume -- a measure of all the goods it sells online -- rose 24 per cent last quarter. That’s less than half the 54 per cent pace of the previous period.

Walmart shares were down more than six per cent in pre-market trading at 7:45 a.m. ET. 

-- With files from Bloomberg News