Costco saw sales climb in its first quarter, as comps, net sales and net income all advanced from the previous quarter.
For its first quarter ended November 20, Costco Wholesale Corp. posted company net income of $545 million, or $1.24 per diluted share, versus $480 million, or $1.09 per diluted share, in the period a year earlier.
The first quarter this year got a boost from a non-recurring $51 million, or seven cents per diluted share after tax, benefit resulting from a legal settlement. Adjusted for the one time benefit, earnings per diluted share missed a Zacks Investment Research analyst average estimate of $1.19.
Comparable sales, excluding the effects of fuel price and foreign exchange fluctuations, were up 2%. Comps, without fuel and exchange effects, gained 1% in the United States, 5% in Canada, and 3% in other international markets. Net sales for the first quarter were $27.47 billion, an increase of 3% versus the year-prior period.
In a conference call, Costco noted that the soft lines category, including home-related merchandise, was relatively strong, with comps up in the low single digits led by the apparel, small electrics and special events segments. In hardlines, which came in flat, health and beauty aid products were among the strongest performers. The company said comps experienced deflationary pressure in consumables and some other segments including big ticket items such as televisions. As for regions, the Northwest, Texas and the Midwest came in best.
Costco currently operates 723 warehouse clubs, including 506 in the U.S. and Puerto Rico, 94 in Canada, 36 in Mexico, 28 in the United Kingdom, 25 in Japan, 12 in Korea, 12 in Taiwan, eight in Australia and two in Spain.
