I’m not a financial analyst, and I don’t even play one on the Internet, but I did want to share the latest Costco earnings information with everyone, because it is really quite good. For about a year, Costco has been doing well, but not outpacing the expectations of the analysts. However, their latest results from the fourth quarter of fiscal year 2014 (ending August 31) were well up from last year and definitely exceeded expectations.
For FY2014 Q4 Costco reported earnings per share of $1.58 or $697 million, which was a healthy 12.9% increase over the $1.40 per share, or $617 million, for earnings during the same period last year. Also, that $1.58 is way ahead of the $1.52 per share that analysts had predicted. Sales for Q4 rose by 9% to $34.8 billion. Overall, FY2014 for Costco saw net sales of $110.21 billion, representing an increase of 7% from $102.87 billion last year. Costco saw an increase in comparable store sales growth of 6%, in the US and internationally, for the last quarter, and an increase of 4% growth overall for the fiscal year. Comparable sales growth would have been a bit better without the negative impacts of gasoline prices and detrimental currency fluctuations (the dollar has really gained a lot of ground on multiple foreign currencies in the last quarter so that hurt international sales growth numbers).
The good news is that Costco continues to do well, even when other retailers have been reporting slumping sales and weak numbers. Costco should be able to continue to post such good results during their fiscal year 2015 since all indicators point to a growing retail market in the US again.
As you can imagine, all of that good news, led Costco stock (COST) to jump to a new high yesterday. Costco ended the trading day at $128.73 per share, an increase of $3.46 or 2.76% for the day.
During the earnings conference call, Richard Galanti, CFO, shared a bit about their expansion plans for FY2015. The plan is to open 31 new locations and relocate four existing locations to new stores. Of that 31, eight of those will be opened by the end of the year (I have those listed on my locations page), plus one relocations in Wayne, New Jersey. The overall breakdown is that 19 of the new stores will be in the US, 1 in Canada, 1 in the UK, 1 in Spain, 1 in Australia, 1 in Taiwan, 2 in Mexico, 2 in Japan, and 3 in Korea. Of course, some of those could be delayed and others could be faster to develop, but the total of new stores should come out to around 30, not including the four relocations. Also, they are planning to expand their ecommerce operations to one or two new countries by the end of 2015.
For more information: