Costco posted another strong quarter with solid comparable sales and earnings increases as nonfoods revenue, including home furnishings, health and beauty aids, luggage and hardware, gained.
Net income for the quarter was $1.8 billion, or $4.04 per diluted share, versus $1.59 billion, or $3.58 per diluted share, in the year previous period, the company reported. First quarter results included a tax benefit of $100 million, or 22 cents per diluted share, related to stock-based compensation, while results in the first quarter last year included a tax benefit of $44 million, or 10 cents per diluted share, also related to stock-based compensation.
Earnings per share, at $3.82 with the tax benefit excluded, beat a Zacks Investment Research analyst consensus estimate of $3.79, while revenues topped the forecast of $62.05 billion.
With the effects of changes in gasoline prices and foreign exchange excluded, company comparable sales gained 7.1,% with comps up 7.2% in the U.S., 6.7% in Canada, and 7.1% in other international locations. E-commerce comps advanced 13.2%.
For the quarter, net sales were $60.99 billion and total revenue was $62.15 billion, up from $56.72 billion and $57.8 billion in the year-prior quarter. Operating income was $2.2 billion versus $1.98 billion in the year-earlier period.
In a conference call, Gary Millerchip, Costco CFO, said nonfood category comps were up in the high single digits despite some impact from calendar shift, with home furnishings, gold jewelry, gift cards, sporting goods, health and beauty aids, luggage, kiosk and hardware all up double digits. Food and Sundries comps gained in the mid-single digits while Fresh Food gained in the high single digits.
In the U.S., traffic gained 4.9,% while average ticket was up 0.3%
Ron Vachris, Costco president and CEO, noted that Costco opened seven new warehouses, including one relocation, in the first quarter and one since its ending. Costco’s real estate plans for the current fiscal year include opening 29 new locations through the current fiscal year, with three being relocations. Costco currently operates 897 warehouse clubs, including 617 in the U.S. and Puerto Rico, 109 in Canada, 41 in Mexico, 36 in Japan, 29 in the United Kingdom, 19 in Korea, 15 in Australia, 14 in Taiwan, seven in China, five in Spain, two in France, and one each in Iceland, New Zealand and Sweden. Costco also operates e-commerce websites in the U.S., Canada, the U.K., Mexico, Korea, Taiwan, Japan and Australia.
