Bulletin
Investor Alert

New York Markets Close in:

Oct. 3, 2019, 4:15 p.m. EDT

Costco Wholesale Corporation Reports Fourth Quarter and Fiscal Year 2019 Operating Results

ISSAQUAH, Wash., Oct 03, 2019 (GLOBE NEWSWIRE via COMTEX) -- Costco Wholesale Corporation ("Costco" or the "Company") (NAS:COST) today announced its operating results for the 16-week fourth quarter and the 52-week fiscal year, ended September 1, 2019.

Net sales for the quarter were $46.45 billion, an increase of 7.0 percent from $43.41 billion during the similar period last year. Net sales for the fiscal year were $149.35 billion, an increase of 7.9 percent from $138.43 billion during the similar period last year.

Comparable sales for the fourth quarter and the fiscal year were as follows:







        
                             16 Weeks  16 Weeks   52 Weeks  52 Weeks
                                       Adjusted*            Adjusted*
         U.S.                6.2%      5.2%       7.8%      6.4%
         Canada              2.6%      4.7%       1.6%      5.3%
         Other International 1.9%      5.0%       2.0%      5.6%
         Total Company       5.1%      5.1%       6.1%      6.1%
         E-commerce          19.8%     21.9%      23.1%     23.3%
        


*Excluding the impacts from changes in gasoline prices, foreign exchange, and a previously disclosed accounting change concerning revenue recognition (ASC 606).

Net income for the fourth quarter was $1,097 million, or $2.47 per diluted share, compared to $1,043 million, or $2.36 per diluted share, last year. This year's fourth quarter was negatively impacted by a $123 million pre-tax reserve to SG&A ($96 million after-tax), or 22 cents per diluted share, related to a product tax assessment.

Net income for the fiscal year was $3.66 billion, or $8.26 per diluted share, compared to $3.13 billion, or $7.09 per diluted share, in the prior year. As previously disclosed and mentioned above, this year's net income was impacted by a net benefit of $30 million or $0.07 per diluted share from primarily non-recurring items. Last year was positively impacted by a first quarter tax benefit of $41 million or $0.09 per diluted share.

Costco currently operates 783 warehouses, including 544 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, one in France, one in Iceland, and one in China. Costco also operates e-commerce web sites in the U.S., Canada, the United Kingdom, Mexico, Korea and Taiwan.

A conference call to discuss these results is scheduled for 2:00 p.m. (PT) today, October 3, 2019, and is available via a webcast on www.costco.com (click on Investor Relations and "Play Webcast").

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, 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 remediate material weaknesses in internal control, 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 that they are made, and the Company does not undertake to update them, 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)







                                                            16 Weeks Ended                      52 Weeks Ended
                                                            September 1,      September 2,      September 1,       September 2,
                                                            2019              2018              2019               2018
        REVENUE
        Net sales                                           $    46,448       $    43,414       $    149,351       $    138,434
        Membership fees                                     1,050             997               3,352              3,142
        Total revenue                                       47,498            44,411            152,703            141,576
        OPERATING EXPENSES
        Merchandise costs                                   41,310            38,671            132,886            123,152
        Selling, general and administrative                 4,684             4,263             14,994             13,876
        Preopening expenses                                 41                31                86                 68
        Operating income                                    1,463             1,446             4,737              4,480
        OTHER INCOME (EXPENSE)
        Interest expense                                    (45         )     (48         )     (150         )     (159         )
        Interest income and other, net                      74                51                178                121
        INCOME BEFORE INCOME TAXES                          1,492             1,449             4,765              4,442
        Provision for income taxes                          382               396               1,061              1,263
        Net income including noncontrolling interests       1,110             1,053             3,704              3,179
        Net income attributable to noncontrolling interests (13         )     (10         )     (45          )     (45          )
        NET INCOME ATTRIBUTABLE TO COSTCO                   $    1,097        $    1,043        $    3,659         $    3,134
        NET INCOME PER COMMON SHARE ATTRIBUTABLE TO COSTCO:
        Basic                                               $    2.49         $    2.38         $    8.32          $    7.15
        Diluted                                             $    2.47         $    2.36         $    8.26          $    7.09
        Shares used in calculation (000's):
        Basic                                               439,727           438,379           439,755            438,515
        Diluted                                             443,400           442,427           442,923            441,834
        


COSTCO WHOLESALE CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(amounts in millions, except par value and share data)

(unaudited)

Subject to Reclassifications







                                                                                                                               September 1, 2019  September 2, 2018
        ASSETS
        CURRENT ASSETS
        Cash and cash equivalents                                                                                              $     8,384        $     6,055
        Short-term investments                                                                                                 1,060              1,204
        Receivables, net                                                                                                       1,535              1,669
        Merchandise inventories                                                                                                11,395             11,040
        Other current assets                                                                                                   1,111              321
        Total current assets                                                                                                   23,485             20,289
        PROPERTY AND EQUIPMENT
        Land                                                                                                                   6,417              6,193
        Buildings and improvements                                                                                             17,136             16,107
        Equipment and fixtures                                                                                                 7,801              7,274
        Construction in progress                                                                                               1,272              1,140
                                                                                                                               32,626             30,714
        Less accumulated depreciation and amortization                                                                         (11,736      )     (11,033      )
        Net property and equipment                                                                                             20,890             19,681
        OTHER ASSETS                                                                                                           1,025              860
        TOTAL ASSETS                                                                                                           $     45,400       $     40,830
        LIABILITIES AND EQUITY
        CURRENT LIABILITIES
        Accounts payable                                                                                                       $     11,679       $     11,237
        Accrued salaries and benefits                                                                                          3,176              2,994
        Accrued member rewards                                                                                                 1,180              1,057
        Deferred membership fees                                                                                               1,711              1,624
        Current portion of long-term debt                                                                                      1,699              90
        Other current liabilities                                                                                              3,792              2,924
        Total current liabilities                                                                                              23,237             19,926
        LONG-TERM DEBT, excluding current portion                                                                              5,124              6,487
        OTHER LIABILITIES                                                                                                      1,455              1,314
        Total liabilities                                                                                                      29,816             27,727
        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; 439,625,000 and 438,189,000 shares issued and outstanding 4                  4
        Additional paid-in capital                                                                                             6,417              6,107
        Accumulated other comprehensive loss                                                                                   (1,436       )     (1,199       )
        Retained earnings                                                                                                      10,258             7,887
        Total Costco stockholders' equity                                                                                      15,243             12,799
        Noncontrolling interests                                                                                               341                304
        Total equity                                                                                                           15,584             13,103
        TOTAL LIABILITIES AND EQUITY                                                                                           $     45,400       $     40,830
        


__GNW8366DE3E__IMG

(C) Copyright 2019 GlobeNewswire, Inc. All rights reserved.

Link to MarketWatch's Slice.