June 1, 2010
Costco posts increase in quarterly profits
Costco Wholesale Corp's quarterly profits increased by 46%, thanks to an improving economy and more consumers spending on non-discretionary items, executives said.
Net sales increased roughly 10% over the past three quarters as a result of both increased consumer spending and the club store segment's growing share of the retail food market. Same-store sales, excluding the effects of gasoline inflation and currency fluctuations, also gained 4% in the 12 week period and 3% in the first 36 weeks of the year, led by gains of 8% and 9% from international outlets, according to Costco.
Among the highlights of Costco's third-quarter financial results, net income rose to US$306 million, or 68 cents a share, from US$210 million, or 48 cents, a year earlier. Revenue rose 12% to $17.4 billion, while sales for the 568-store warehouse retailer also increased 12% to US$17.39 billion.
Costco's Chief Financial Officer Richard Galanti said Costco posted especially strong gains in meat, produce and other fresh foods during the third quarter of last year, with mid- to high single-digit average increases compared to the same period a year earlier.
By the end of August this year, Costco expects to open five new stores, along with the 524 other stores already operating in the US, Canada, Mexico and Puerto Rico.
