News Release

Costco Wholesale Corporation Reports Second Quarter and Year-to-Date Operating Results for Fiscal 2020 and February Sales Results
Net sales for the quarter increased 10.5 percent, to
Comparable sales for the second quarter fiscal 2020 were as follows:
12 Weeks | 12 Weeks | 24 Weeks | 24 Weeks | ||||||
Adjusted* | Adjusted* | ||||||||
9.1% | 8.1% | 7.0% | 6.6% | ||||||
8.9% | 6.8% | 5.8% | 5.9% | ||||||
Other International | 7.9% | 7.1% | 5.5% | 5.8% | |||||
8.9% | 7.9% | 6.6% | 6.5% | ||||||
E-commerce | 28.4% | 28.0% | 17.4% | 17.3% | |||||
*Excluding the impacts from changes in gasoline prices and foreign exchange. |
Due to
Reported net income for the quarter was
For the four-week reporting month of February, ended
Comparable sales for the February and year-to-date periods ended
4 Weeks | 4 Weeks | 26 Weeks | 26 Weeks | ||||||
Adjusted* | Adjusted* | ||||||||
12.4% | 11.6% | 7.5% | 7.1% | ||||||
10.2% | 10.4% | 6.2% | 6.3% | ||||||
Other International | 12.5% | 13.5% | 6.1% | 6.5% | |||||
12.1% | 11.7% | 7.2% | 7.0% | ||||||
E-commerce | 22.6% | 22.7% | 17.9% | 17.9% | |||||
*Excluding the impacts from changes in gasoline prices and foreign exchange. |
February sales benefited from an uptick in consumer demand in the fourth week of the reporting period. We attribute this to concerns over the Coronavirus and estimate the positive impact on total and comparable sales to be approximately three percent.
A conference call to discuss these results is scheduled for
Certain statements contained in this document and the pre-recorded telephone message constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. For these purposes, forward-looking statements are statements that address activities, events, conditions or developments that the Company expects or anticipates may occur in the future. In some cases forward-looking statements can be identified because they contain words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “likely,” “may,” “might,” “plan,” “potential,” “predict,” “project,” “seek,” “should,” “target,” “will,” “would,” or similar expressions and the negatives of those terms. Such forward-looking statements involve risks and uncertainties that may cause actual events, results or performance to differ materially from those indicated by such statements. These risks and uncertainties include, but are not limited to, domestic and international economic conditions, including exchange rates, the effects of competition and regulation, uncertainties in the financial markets, consumer and small business spending patterns and debt levels, breaches of security or privacy of member or business information, conditions affecting the acquisition, development, ownership or use of real estate, capital spending, actions of vendors, rising costs associated with employees (generally including health care costs), energy and certain commodities, geopolitical conditions (including tariffs), the ability to maintain effective internal control over financial reporting, global disease threats, and other risks identified from time to time in the Company’s public statements and reports filed with the
CONTACTS: | |
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(dollars in millions, except per share data) (unaudited)
12 Weeks Ended | 24 Weeks Ended | |||||||||||||||
REVENUE | ||||||||||||||||
Net sales | $ | 38,256 | $ | 34,628 | $ | 74,492 | $ | 68,939 | ||||||||
Membership fees | 816 | 768 | 1,620 | 1,526 | ||||||||||||
Total revenue | $ | 39,072 | 35,396 | 76,112 | 70,465 | |||||||||||
OPERATING EXPENSES | ||||||||||||||||
Merchandise costs | 34,056 | 30,720 | 66,289 | 61,343 | ||||||||||||
Selling, general and administrative | 3,743 | 3,464 | 7,475 | 6,939 | ||||||||||||
Preopening expenses | 7 | 9 | 21 | 31 | ||||||||||||
Operating income | 1,266 | 1,203 | 2,327 | 2,152 | ||||||||||||
OTHER INCOME (EXPENSE) | ||||||||||||||||
Interest expense | (34 | ) | (34 | ) | (72 | ) | (70 | ) | ||||||||
Interest income and other, net | 45 | 46 | 80 | 68 | ||||||||||||
INCOME BEFORE INCOME TAXES | 1,277 | 1,215 | 2,335 | 2,150 | ||||||||||||
Provision for income taxes | 330 | 314 | 532 | 472 | ||||||||||||
Net income including noncontrolling interests | 947 | 901 | 1,803 | 1,678 | ||||||||||||
Net income attributable to noncontrolling interests | (16 | ) | (12 | ) | (28 | ) | (22 | ) | ||||||||
NET INCOME ATTRIBUTABLE TO COSTCO | $ | 931 | $ | 889 | $ | 1,775 | $ | 1,656 | ||||||||
NET INCOME PER COMMON SHARE ATTRIBUTABLE TO COSTCO: | ||||||||||||||||
Basic | $ | 2.10 | $ | 2.02 | $ | 4.02 | $ | 3.77 | ||||||||
Diluted | $ | 2.10 | $ | 2.01 | $ | 4.00 | $ | 3.74 | ||||||||
Shares used in calculation (000’s): | ||||||||||||||||
Basic | 442,021 | 440,284 | 441,920 | 439,721 | ||||||||||||
Diluted | 443,727 | 442,337 | 443,704 | 442,535 | ||||||||||||
CONDENSED CONSOLIDATED BALANCE SHEETS
(amounts in millions, except par value and share data) (unaudited)
Subject to Reclassifications | |||||||||
ASSETS | |||||||||
CURRENT ASSETS | |||||||||
Cash and cash equivalents | $ | 7,786 | $ | 8,384 | |||||
Short-term investments | 929 | 1,060 | |||||||
Receivables, net | 1,988 | 1,535 | |||||||
Merchandise inventories | 11,850 | 11,395 | |||||||
Other current assets | 1,150 | 1,111 | |||||||
Total current assets | 23,703 | 23,485 | |||||||
PROPERTY AND EQUIPMENT | |||||||||
Land | 6,696 | 6,417 | |||||||
Buildings and improvements | 17,853 | 17,136 | |||||||
Equipment and fixtures | 8,406 | 7,801 | |||||||
Construction in progress | 906 | 1,272 | |||||||
Accumulated depreciation and amortization | (12,380 | ) | (11,736 | ) | |||||
Net property and equipment | 21,481 | 20,890 | |||||||
OTHER ASSETS | |||||||||
Operating lease right-of-use assets | 2,596 | — | |||||||
Other long-term assets | 1,002 | 1,025 | |||||||
TOTAL ASSETS | $ | 48,782 | $ | 45,400 | |||||
LIABILITIES AND EQUITY | |||||||||
CURRENT LIABILITIES | |||||||||
Accounts payable | $ | 11,072 | $ | 11,679 | |||||
Accrued salaries and benefits | 3,415 | 3,176 | |||||||
Accrued member rewards | 1,243 | 1,180 | |||||||
Deferred membership fees | 1,865 | 1,711 | |||||||
Current portion of long-term debt | 500 | 1,699 | |||||||
Other current liabilities | 4,600 | 3,792 | |||||||
Total current liabilities | 22,695 | 23,237 | |||||||
OTHER LIABILITIES | |||||||||
Long-term debt, excluding current portion | 5,099 | 5,124 | |||||||
Long-term operating lease liabilities | 2,446 | — | |||||||
Other long-term liabilities | 1,543 | 1,455 | |||||||
TOTAL LIABILITIES | 31,783 | 29,816 | |||||||
COMMITMENTS AND CONTINGENCIES | |||||||||
EQUITY | |||||||||
Preferred stock |
— | — | |||||||
Common stock |
4 | 4 | |||||||
Additional paid-in capital | 6,506 | 6,417 | |||||||
Accumulated other comprehensive loss | (1,280 | ) | (1,436 | ) | |||||
Retained earnings | 11,384 | 10,258 | |||||||
Total |
16,614 | 15,243 | |||||||
Noncontrolling interests | 385 | 341 | |||||||
TOTAL EQUITY | 16,999 | 15,584 | |||||||
TOTAL LIABILITIES AND EQUITY | $ | 48,782 | $ | 45,400 |
Source: Costco Wholesale Corporation