News Release

Costco Wholesale Corporation Reports Second Quarter and Year-to-Date Operating Results for Fiscal 2001 and February Sales Results
ISSAQUAH, Wash.--(BUSINESS WIRE)--March 8, 2001--Costco Wholesale Corporation ("Costco" or the "Company") (Nasdaq:COST) announced today its operating results for the second quarter (12 weeks) and first half (24 weeks) of fiscal 2001, ended February 18, 2001.
Net sales for the second quarter of fiscal 2001 increased 7% to $8.16 billion from $7.61 billion during the second quarter of fiscal 2000. On a comparable warehouse basis, that is warehouses open at least a year, net sales increased by 2%.
Net income for the second quarter of fiscal 2001 decreased 3% to $176.6 million, or $.38 per share (diluted), from $181.6 million, or $.39 per share (diluted), during the second quarter of fiscal 2000.
Net sales for the first half of fiscal 2001 increased 8% to $15.66 billion from $14.44 billion during the first half of fiscal 2000. Comparable warehouse sales during the first half (24 weeks) of fiscal 2001 increased 3% over the prior year's levels.
Net income for the first half of fiscal 2001 decreased 2% to $306.1 million, or $.65 per diluted share, compared to net income for the first half of fiscal 2000 of $310.9 million, or $.66 per diluted share.
In addition to reporting second quarter fiscal year 2001 operating results, the Company today reported net sales of $2.45 billion for the four weeks ended March 4, 2001, an increase of 11% from $2.21 billion in the same four-week period of the prior fiscal year. On a comparable warehouse basis, that is warehouses open at least a year, sales increased 5%.
For the first twenty-six weeks of its 2001 fiscal year ended March 4, 2001, which includes the first two weeks of the Company's fiscal third quarter, the Company reported net sales of $16.90 billion, an increase of 9% from $15.51 billion during the comparable period of the prior fiscal year. Comparable sales for this year-to-date period increased 4% over the prior year's level.
Costco currently operates 352 warehouses, including 253 in the United States, 60 in Canada, 11 in the United Kingdom, four in Korea, three in Taiwan, two in Japan and 19 in Mexico. The Company also operates Costco Online, an electronic commerce web site, at www.costco.com. The Company plans to open an additional 14 to 16 new warehouses (including one to two relocations of existing warehouses to larger and better-located facilities) prior to the end of its 2001 fiscal year on September 2, 2001.
A conference call to discuss these second quarter results is scheduled for 8:30 a.m. (PST) today, March 8, 2001, and is available via a webcast on www.costco.com (go to Customer Service, Investor Relations, Financial Releases and click on the "Live Webcast" icon).
COSTCO WHOLESALE CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF INCOME (dollars in thousands, except per share data) (unaudited) 12 Weeks Ended 24 Weeks Ended ------------------------ -------------------------- February 18, February 13, February 18, February 13, 2001 2000 2001 2000 ----------- ----------- ------------ ------------ REVENUE Net sales $ 8,159,980 $ 7,613,601 $ 15,658,959 $ 14,437,798 Membership fees and other 146,329 123,386 284,628 242,701 ----------- ----------- ------------ ------------ Total revenue 8,306,309 7,736,987 15,943,587 14,680,499 OPERATING EXPENSES Merchandise costs 7,275,958 6,792,367 13,989,602 12,912,568 Selling, general and administrative 731,411 636,739 1,422,538 1,233,456 Preopening expenses 10,572 8,108 30,252 18,442 Provision for impaired assets and warehouse closing costs 1,000 1,500 2,000 2,500 ----------- ----------- ------------ ------------ Operating income 287,368 298,273 499,195 513,533 OTHER INCOME (EXPENSE) Interest expense (8,902) (10,576) (15,866) (20,973) Interest income and other 15,829 14,983 26,834 25,650 ----------- ----------- ------------ ------------ INCOME BEFORE INCOME TAXES 294,295 302,680 510,163 518,210 Provision for income taxes 117,718 121,072 204,065 207,284 ----------- ----------- ------------ ------------ NET INCOME $ 176,577 $ 181,608 $ 306,098 $ 310,926 =========== =========== ============ ============ NET INCOME PER COMMON AND COMMON EQUIVALENT SHARE: Basic $ 0.39 $ 0.41 $ 0.68 $ 0.70 =========== =========== ============ ============ Diluted $ 0.38 $ 0.39 $ 0.65 $ 0.66 =========== =========== ============ ============ Shares used in calculation (000's) Basic 448,788 445,255 448,234 444,277 Diluted 475,488 476,642 474,543 475,120CONTACT:
Costco Wholesale Corporation
Richard Galanti, 425/313-8203
Bob Nelson, 425/313-8255