Amid retail malaise, Costco has a healthy quarter

A slump among some retailers and the onslaught of online competition wasn’t enough to deter Costco, which posted healthy third-quarter earnings and sales growth Thursday.

A slump among some retailers and the onslaught of online competition wasn’t enough to deter Costco, which posted healthy third-quarter earnings and sales growth Thursday.

The warehouse giant’s earnings per share were $1.59, up 28 percent. Excluding one-time items, earnings of $1.40 per share beat Wall Street analysts’ expectations of $1.31, according to a Reuters consensus estimate.

Sales at stores open at least a year — known as comparable sales — also topped expectations and rose by higher percentages than in recent quarters.

Companywide, Costco’s comparable sales grew 5 percent, excluding the impact of fluctuating gas prices and foreign exchange. That’s higher than the 2 to 3 percent growth the company logged in the past four quarters, and better than Wall Street’s expectation of 3.9 percent growth, according to Consensus Metrix.

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U.S. comparable sales also grew 5 percent, better than the 1 to 3 percent range of the past four quarters.

Richard Galanti, Costco’s chief financial officer, cited several factors for the solid numbers.

Both shopping frequency and the average amount customers spent per transaction increased.

Gasoline, which accounts for just under 10 percent of the company’s sales, saw strong sales and profit growth.

Revenue from membership fees went up about 4 percent, with new members signing up and membership fee increases that went into effect in some non-U.S. countries.

Membership fees in the U.S. and Canada go up June 1. Galanti said, based on previous fee increases, that the company doesn’t expect that to affect how many people choose to remain or become members.

Healthy sales and…

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