ISSAQUAH, Wash., March 05, 2020 (GLOBE NEWSWIRE) -- Costco Wholesale Corporation (“Costco” or the “Company”) (Nasdaq: COST) today announced its operating results for the second quarter (twelve weeks) and the first 24 weeks of fiscal 2020, ended February 16, 2020.

Net sales for the quarter increased 10.5 percent, to $38.26 billion from $34.63 billion last year. Net sales for the first 24 weeks increased 8.1 percent, to $74.49 billion from $68.94 billion last year.

Comparable sales for the second quarter fiscal 2020 were as follows:

  12 Weeks 12 Weeks 24 Weeks 24 Weeks 
    Adjusted*   Adjusted* 
 U.S.9.1% 8.1% 7.0% 6.6% 
 Canada8.9% 6.8% 5.8% 5.9% 
 Other International7.9% 7.1% 5.5% 5.8% 
          
 Total Company8.9% 7.9% 6.6% 6.5% 
          
 E-commerce28.4% 28.0% 17.4% 17.3% 
          
 *Excluding the impacts from changes in gasoline prices and foreign exchange. 

Due to Thanksgiving occurring a week later this year, for the quarter: total and comparable sales were positively impacted by approximately one-half percent; and e-commerce sales were positively impacted by an estimated 11 percentage points.

Reported net income for the quarter was $931 million, or $2.10 per diluted share, compared to $889 million, or $2.01 per diluted share, last year. Net income for the first 24 weeks was $1.77 billion, or $4.00 per diluted share, compared to $1.66 billion, or $3.74 per diluted share, last year.

For the four-week reporting month of February, ended March 1, 2020, the Company reported net sales of $12.20 billion, an increase of 13.8 percent from $10.72 billion last year. For the twenty-six week period ended March 1, 2020, net sales were $80.76 billion, an increase of 8.5 percent from $74.42 billion last year.

Comparable sales for the February and year-to-date periods ended March 1, 2020, were as follows:

  4 Weeks 4 Weeks 26 Weeks 26 Weeks 
    Adjusted*   Adjusted* 
 U.S.12.4% 11.6% 7.5% 7.1% 
 Canada10.2% 10.4% 6.2% 6.3% 
 Other International12.5% 13.5% 6.1% 6.5% 
          
 Total Company12.1% 11.7% 7.2% 7.0% 
          
 E-commerce22.6% 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.

Costco currently operates 785 warehouses, including 546 in the United States and Puerto Rico, 100 in Canada, 39 in Mexico, 29 in the United Kingdom, 26 in Japan, 16 in Korea, 13 in Taiwan, 11 in Australia, two in Spain, and one each in Iceland, France, and China. Costco also operates e-commerce sites in the U.S., Canada, the United Kingdom, Mexico, Korea, Taiwan, Japan, and Australia.

A conference call to discuss these results is scheduled for 2:00 p.m. (PT) today, March 5, 2020, and is available via a webcast on www.costco.com (click on Investor Relations and “Play Webcast”).

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 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.

CONTACTS:Costco Wholesale Corporation
 Richard Galanti, 425/313-8203
 Bob Nelson, 425/313-8255
 David Sherwood, 425/313-8239
 Josh Dahmen, 425/313-8254


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

    
 12 Weeks Ended 24 Weeks Ended
 February 16, 2020 February 17, 2019 February 16, 2020 February 17, 2019
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 
        

                                

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

    
Subject to Reclassifications February 16, 2020 September 1, 2019
ASSETS   
CURRENT ASSETS   
Cash and cash equivalents$7,786  $8,384 
Short-term investments929  1,060 
Receivables, net1,988  1,535 
Merchandise inventories11,850  11,395 
Other current assets1,150  1,111 
Total current assets23,703  23,485 
PROPERTY AND EQUIPMENT   
Land6,696  6,417 
Buildings and improvements17,853  17,136 
Equipment and fixtures8,406  7,801 
Construction in progress906  1,272 
Accumulated depreciation and amortization(12,380) (11,736)
Net property and equipment21,481  20,890 
OTHER ASSETS   
Operating lease right-of-use assets2,596  — 
Other long-term assets1,002  1,025 
TOTAL ASSETS$48,782  $45,400 
LIABILITIES AND EQUITY   
CURRENT LIABILITIES   
Accounts payable$11,072  $11,679 
Accrued salaries and benefits3,415  3,176 
Accrued member rewards1,243  1,180 
Deferred membership fees1,865  1,711 
Current portion of long-term debt500  1,699 
Other current liabilities4,600  3,792 
Total current liabilities22,695  23,237 
OTHER LIABILITIES   
Long-term debt, excluding current portion5,099  5,124 
Long-term operating lease liabilities2,446  — 
Other long-term liabilities1,543  1,455 
TOTAL LIABILITIES31,783  29,816 
COMMITMENTS AND CONTINGENCIES   
EQUITY   
Preferred stock $0.01 par value; 100,000,000 shares authorized; no shares issued and outstanding—  — 
Common stock $0.01 par value; 900,000,000 shares authorized; 441,622,000 and 439,625,000 shares issued and outstanding4  4 
Additional paid-in capital6,506  6,417 
Accumulated other comprehensive loss(1,280) (1,436)
Retained earnings11,384  10,258 
Total Costco stockholders’ equity16,614  15,243 
Noncontrolling interests385  341 
TOTAL EQUITY16,999  15,584 
TOTAL LIABILITIES AND EQUITY$48,782  $45,400