Costco Wholesale
Corporation announced operating results for
the second quarter (12 weeks) and first half (24 weeks) of fiscal
2004, both ended February 15, 2004.
Net sales for the second quarter of fiscal 2004 increased 14% to
$11.33 billion from $9.92 billion during the second quarter of fiscal
2003. Net income for the second quarter of fiscal 2004 increased 25%
to $226.8 million, or $.48 per diluted share, compared to $182.1
million, or $.39 per diluted share, during the second quarter of
fiscal 2003. Included in the second quarter fiscal 2003 operating
results was a pre-tax charge of $26 million ($16 million, or $.03 per
share after tax) reflecting an increase in workers' compensation loss
reserves.
Net sales for the first half of fiscal 2004 increased 14% to
$21.64 billion from $18.93 billion during the first half of fiscal
2003. Net income for the first half of fiscal 2004 increased 18% to
$387.0 million, or $.82 per diluted share, compared to net income for
the first half of fiscal 2003 of $327.8 million, or $.70 per diluted
share.
In addition to reporting second quarter fiscal year 2004 operating
results, the Company today reported net sales of $3.49 billion for the
4-week retail reporting month of February, the four weeks ended
February 29, 2004, an increase of 14% from $3.07 billion in the same
four-week period of the prior fiscal year.
For the 6-month retail reporting period of September through
February, the twenty-six weeks ended February 29, 2004, which includes
the first two weeks of the Company's fiscal third quarter, the Company
reported net sales of $23.41 billion, an increase of 14% from $20.45
billion during the comparable period of the prior fiscal year.
Comparable sales for the 4-week retail-reporting month of February
and the 26-week retail-reporting period of September through February
are as follows:
4 26
Weeks Weeks
------ ------
US 9% 9%
International 21% 21%
Total Company 11% 11%
====== ======
Comparable sales for the fiscal second quarter (12 weeks) and
fiscal first half (24 weeks) of fiscal 2004, both ended February 15,
2004, are as follows:
12 24
Weeks Weeks
------ ------
US 10% 9%
International 20% 21%
Total Company 11% 11%
====== ======
Current year sales results in all of the above comparisons were
positively impacted by stronger foreign currencies and, since
October 12, 2003, the Southern California grocery strike.
Costco currently operates 431 warehouses, including 318 in the
United States, 63 in Canada, 15 in the United Kingdom, five in Korea,
three in Taiwan, four in Japan and 23 in Mexico. The Company also
operates Costco Online, an electronic commerce web site, at
www.costco.com. The Company plans to open seven to eight additional
new warehouses (including the relocation of one warehouse to a larger
and better-located facility) prior to the end of its fiscal year
ending August 29, 2004.
A conference call to discuss these second quarter results is
scheduled for 8:00 a.m. (PST) today (March 3rd), and is available via
a webcast on www.costco.com (go to Customer Service, Investor
Relations, Financial Releases and click on the “Live Webcast” icon).
COSTCO WHOLESALE CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(dollars in thousands, except per share data)
(unaudited)
12 Weeks Ended 24 Weeks Ended
------------------------- -------------------------
February 15, February 16, February 15, February 16,
2004 2003 2004 2003
------------ ------------ ------------ ------------
REVENUE
Net sales $11,330,214 $ 9,920,324 $21,640,036 $18,930,895
Membership fees
and other 218,760 193,843 430,416 381,857
------------ ------------ ------------ ------------
Total revenue 11,548,974 10,114,167 22,070,452 19,312,752
OPERATING EXPENSES
Merchandise costs 10,101,977 8,840,411 19,322,099 16,889,308
Selling, general
and administrative 1,084,605 967,051 2,117,018 1,855,830
Preopening expenses 4,216 7,145 14,341 25,262
Provision for
impaired assets
and closing costs 3,000 4,500 7,000 9,500
------------ ------------ ------------ ------------
Operating income 355,176 295,060 609,994 532,852
OTHER INCOME (EXPENSE)
Interest expense (8,261) (8,003) (16,736) (16,471)
Interest income
and other 13,072 8,983 20,975 16,617
------------ ------------ ------------ ------------
INCOME BEFORE INCOME
TAXES 359,987 296,040 614,233 532,998
Provision for
income taxes 133,195 113,975 227,266 205,204
------------ ------------ ------------ ------------
NET INCOME $ 226,792 $ 182,065 $ 386,967 $ 327,794
============ ============ ============ ============
NET INCOME PER
COMMON AND COMMON
EQUIVALENT SHARE:
Basic $ 0.49 $ 0.40 $ 0.85 $ 0.72
============ ============ ============ ============
Diluted $ 0.48 $ 0.39 $ 0.82 $ 0.70
============ ============ ============ ============
Shares used in
calculation (000's)
Basic 458,228 455,927 457,929 455,748
Diluted 481,537 478,564 480,885 478,742
