More on Costco FQ2: Net profit drops 15%

Mar. 06, 2014 4:00 AM ETCostco Wholesale Corporation (COST) StockBy: Yigal Grayeff, SA News Editor1 Comment
  • Costco (NASDAQ:COST) net profit fell to $463M from $547M a year earlier, which was boosted by a $62M tax benefit. "Even with that distinction, however, the year-over-year comparison was unfavorable," says Costco.
  • Other factors that led to lower earnings include: weaker sales and gross margins in some non-food products, particularly during the four-week holiday selling season; weaker gross margins in the fresh foods business; and lower international profits due to currency fluctuations.
  • "The first four-week period of the quarter represented the majority of earnings underperformance," Costco said.
  • Comparable sales +3%, U.S. +4%, international unchanged. Excluding the negative impacts from gasoline price deflation and foreign exchange, comparable sales +5%, U.S. +5%, international +7%.
  • Revenue from membership fees increased 4.1% to $550M.
  • In February, overall sales +4% to $7.9B. Comparable sales +2%, U.S. +3% and international -1%. Excluding gas and forex, comparable sales +4%, U.S. +4%, international +5%.
  • Costco operates 649 warehouses and plans to open another 14 by the end of FY 2014. (PR)
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