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Costco Wholesale Corporation Reports Fourth Quarter and Fiscal Year 2023 Operating Results

09/26/2023

ISSAQUAH, Wash., Sept. 26, 2023 (GLOBE NEWSWIRE) -- Costco Wholesale Corporation (“Costco” or the “Company”) (Nasdaq: COST) today announced its operating results for the 17-week fourth quarter and the 53-week fiscal year ended September 3, 2023.

Net sales for the 17-week fourth quarter were $77.43 billion, an increase of 9.4 percent from $70.76 billion in the 16-week fourth quarter last year. Net sales for the 53-week fiscal year were $237.71 billion, an increase of 6.7 percent from $222.73 billion in the 52-week fiscal year of 2022.

Comparable sales were as follows:

               
  17 Weeks   17 Weeks   53 Weeks   53 Weeks
      Adjusted*       Adjusted*
U.S. 0.2%   3.1%   3.3%   4.2%
Canada 1.8%   7.4%   1.7%   8.1%
Other International 5.5%   4.4%   2.8%   7.6%
               
Total Company 1.1%   3.8%   3.0%   5.2%
               
E-commerce -0.8%   -0.6%   -5.7%   -4.8%

*Excluding the impacts from changes in gasoline prices and foreign exchange.

Net income for the 17-week fourth quarter was $2.160 billion, $4.86 per diluted share, compared to $1.868 billion, $4.20 per diluted share, in the 16-week fourth quarter last year.

Net income for the 53-week fiscal year was $6.292 billion, $14.16 per diluted share, compared to $5.844 billion, $13.14 per diluted share, in the 52-week prior year.

Costco currently operates 861 warehouses, including 591 in the United States and Puerto Rico, 107 in Canada, 40 in Mexico, 33 in Japan, 29 in the United Kingdom, 18 in Korea, 15 in Australia, 14 in Taiwan, five in China, four in Spain, two in France, and one each in Iceland, New Zealand and Sweden. Costco also operates e-commerce sites in the U.S., Canada, the U.K., Mexico, Korea, Taiwan, Japan and Australia.

A conference call to discuss these results is scheduled for 2:00 p.m. (PT) today, September 26, 2023, and will be available via a webcast on investor.costco.com (click “Events & Presentations”).

Certain statements contained in this document 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, inflation or deflation, 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 and the Ukraine conflict), the ability to maintain effective internal control over financial reporting, regulatory and other impacts related to climate change, public-health related factors, and other risks identified from time to time in the Company’s public statements and reports filed with the Securities and Exchange Commission. Forward-looking statements speak only as of the date they are made, and the Company does not undertake to update these statements, except as required by law. Comparable sales and comparable sales excluding impacts from changes in gasoline prices and foreign exchange are intended as supplemental information and are not a substitute for net sales presented in accordance with GAAP.

CONTACTS: Costco Wholesale Corporation
  Richard Galanti, 425/313-8203
  David Sherwood, 425/313-8239
  Josh Dahmen, 425/313-8254

 

CO STCO WHOLESALE CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(dollars in millions, except per share data)
(unaudited)

  17 Weeks Ended   16 Weeks Ended   53 Weeks Ended   52 Weeks Ended
  September 3, 2023   August 28, 2022   September 3, 2023   August 28, 2022
REVENUE              
Net sales $ 77,430     $ 70,764     $ 237,710     $ 222,730  
Membership fees   1,509       1,327       4,580       4,224  
Total revenue   78,939       72,091       242,290       226,954  
OPERATING EXPENSES              
Merchandise costs   69,219       63,558       212,586       199,382  
Selling, general and administrative   6,939       6,036       21,590       19,779  
Operating income   2,781       2,497       8,114       7,793  
OTHER INCOME (EXPENSE)              
Interest expense   (56 )     (48 )     (160 )     (158 )
Interest income and other, net   238       67       533       205  
INCOME BEFORE INCOME TAXES   2,963       2,516       8,487       7,840  
Provision for income taxes   803       638       2,195       1,925  
Net income including noncontrolling interests   2,160       1,878       6,292       5,915  
Net income attributable to noncontrolling interests         (10 )           (71 )
NET INCOME ATTRIBUTABLE TO COSTCO $ 2,160     $ 1,868     $ 6,292     $ 5,844  
               
NET INCOME PER COMMON SHARE ATTRIBUTABLE TO COSTCO:              
Basic $ 4.87     $ 4.21     $ 14.18     $ 13.17  
Diluted $ 4.86     $ 4.20     $ 14.16     $ 13.14  
               
Shares used in calculation (000’s):              
Basic   443,876       443,839       443,854       443,651  
Diluted   444,445       444,655       444,452       444,757  
               


CO STCO WHOLESALE CORPORATION
CONSOLIDATED BALANCE SHEETS
(amounts in millions, except par value and share data)
(unaudited)

Subject to Reclassification

      September 3,
2023
  August 28,
2022
ASSETS      
CURRENT ASSETS      
Cash and cash equivalents $ 13,700     $ 10,203  
Short-term investments   1,534       846  
Receivables, net   2,285       2,241  
Merchandise inventories   16,651       17,907  
Other current assets   1,709       1,499  
Total current assets   35,879       32,696  
OTHER ASSETS      
Property and equipment, net   26,684       24,646  
Operating lease right-of-use assets   2,713       2,774  
Other long-term assets   3,718       4,050  
TOTAL ASSETS $ 68,994     $ 64,166  
LIABILITIES AND EQUITY      
CURRENT LIABILITIES      
Accounts payable $ 17,483     $ 17,848  
Accrued salaries and benefits   4,278       4,381  
Accrued member rewards   2,150       1,911  
Deferred membership fees   2,337       2,174  
Current portion of long-term debt   1,081       73  
Other current liabilities   6,254       5,611  
Total current liabilities   33,583       31,998  
OTHER LIABILITIES      
Long-term debt, excluding current portion   5,377       6,484  
Long-term operating lease liabilities   2,426       2,482  
Other long-term liabilities   2,550       2,555  
TOTAL LIABILITIES   43,936       43,519  
COMMITMENTS AND CONTINGENCIES      
EQUITY      
Preferred stock $0.005 par value; 100,000,000 shares authorized; no shares issued and outstanding          
Common stock $0.005 par value; 900,000,000 shares authorized; 442,793,000 and 442,664,000 shares issued and outstanding   2       2  
Additional paid-in capital   7,340       6,884  
Accumulated other comprehensive loss   (1,805 )     (1,829 )
Retained earnings   19,521       15,585  
Total Costco stockholders’ equity   25,058       20,642  
Noncontrolling interests         5  
TOTAL EQUITY   25,058       20,647  
TOTAL LIABILITIES AND EQUITY $ 68,994     $ 64,166  
               

                          

CO STCO WHOLESALE CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(amounts in millions)
(unaudited)

Subject to Reclassification

  53 Weeks Ended   52 Weeks Ended
  September 3,
2023
  August 28,
2022
CASH FLOWS FROM OPERATING ACTIVITIES      
Net income including noncontrolling interests $ 6,292     $ 5,915  
Adjustments to reconcile net income including noncontrolling interests to net cash provided by operating activities:      
Depreciation and amortization   2,077       1,900  
Non-cash lease expense   412       377  
Stock-based compensation   774       724  
Other non-cash operating activities, net   495       39  
Changes in working capital   1,018       (1,563 )
Net cash provided by operating activities   11,068       7,392  
CASH FLOWS FROM INVESTING ACTIVITIES      
Purchases of short-term investments   (1,622 )     (1,121 )
Maturities and sales of short-term investments   937       1,145  
Additions to property and equipment   (4,323 )     (3,891 )
Other investing activities, net   36       (48 )
Net cash used in investing activities   (4,972 )     (3,915 )
CASH FLOWS FROM FINANCING ACTIVITIES      
Repayments of short-term borrowings   (935 )     (6 )
Proceeds from short-term borrowings   917       53  
Repayments of long-term debt   (75 )     (800 )
Tax withholdings on stock-based awards   (303 )     (363 )
Repurchases of common stock   (676 )     (439 )
Cash dividend payments   (1,251 )     (1,498 )
Financing lease payments   (291 )     (176 )
Dividend to noncontrolling interest         (208 )
Acquisition of noncontrolling interest         (842 )
Other financing activities, net         (4 )
Net cash used in financing activities   (2,614 )     (4,283 )
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS   15       (249 )
Net change in cash and cash equivalents   3,497       (1,055 )
CASH AND CASH EQUIVALENTS BEGINNING OF YEAR   10,203       11,258  
CASH AND CASH EQUIVALENTS END OF YEAR $ 13,700     $ 10,203  


Source: Costco Wholesale Corporation

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