Costco profit rises slightly, misses expectations
Thursday, December 8, 2011
ISSAQUAH, Wash. (AP) — Costco Wholesale Corp. says its fiscal first-quarter profit rose 2.6 percent. Higher costs ate up much of a 12.5 percent increase in revenue.
Shoppers spent more on gasoline and the company benefited from currency exchange rates.
The results missed Wall Street expectations, however. Its shares fell 42 cents to $87.05 in premarket trading.
The wholesale club operator reported Thursday that its net income rose to $320 million, or 73 cents per share, for the quarter that ended Nov. 20. That’s up from $312 million, or 71 cents per share, in the same quarter last year.
The results included charges related to a Mexican tax audit and a campaign in Washington state to change liquor laws that totaled 7 cents per share.
Costco’s revenue rose to $21.18 billion because of higher gasoline prices and benefits of foreign exchange.
Analysts polled by FactSet expected earnings of 80 cents per share on revenue of $21.29 billion.
Costco has performed better than many retailers in the down economy as consumers turned to its wholesale clubs for deals on everyday necessities.
Revenue at stores open at least a year rose 10 percent. Excluding gasoline prices and strengthening foreign currencies, the figure rose 7 percent. Revenue at stores open at least a year is considered a key measurement of a retailer’s performance because it excludes results from stores that open or close during the year.
Costco is based in Issaquah, Wash.