PriceSmart Announces Second Quarter Results of Operations and March Sales
San Diego, CA (April 7, 2016) - PriceSmart, Inc. (NASDAQ: PSMT) today announced its results of operations for the second quarter of fiscal year 2016 which ended on February 29, 2016.
For the second quarter of fiscal year 2016, net warehouse club sales increased 3.7% to $759.0 million from $732.1 million in the second quarter of fiscal year 2015. Total revenues for the second quarter of fiscal year 2016 were $777.9 million compared to $750.3 million in the comparable period of the prior year. The Company had 38 warehouse clubs in operation as of February 2016 and 36 clubs in operation as of February 2015.
The Company recorded operating income during the quarter of $39.1 million, as compared to operating income of $41.7 million in the prior year. Net income was $25.9 million, or $0.85 per diluted share, in the second quarter of fiscal year 2016 as compared to $24.8 million, or $0.82 per diluted share, in the second quarter of fiscal year 2015.
For the first six months of fiscal year 2016, net warehouse club sales increased 5.9% to $1,449.8 million from $1,368.5 million in the first six months of fiscal year 2015. Total revenues for the first half of fiscal year 2016 increased 5.9% to $1,489.9 million from $1,406.3 million in the same period of the prior year. For the first six months of fiscal year 2016, the Company recorded operating income of $76.4 million and net income of $49.6 million, or $1.63 per diluted share. During the same six month period in fiscal year 2015, the Company recorded operating income of $78.0 million and net income of $45.5 million, or $1.50 per diluted share.
The Company also announced that for the month of March 2016, net warehouse club sales decreased to $227.8 million, from $237.7 million in March a year earlier. For the seven months ended March 31, 2016, net warehouse club sales increased 4.4% to $1,677.6 million from $1,606.2 million for the seven months ended March 31, 2015. There were 38 warehouse clubs in operation at the end of March 2016 and 36 warehouse clubs in operation at the end of March 2015.
For the four weeks ended March 27, 2016, comparable net warehouse club sales for the 36 warehouse clubs open at least 13 1/2 full months decreased 5.4%, compared to the same four-week period last year. For the thirty-week period ended March 27, 2016, comparable net warehouse club sales decreased 0.5%, compared to the comparable thirty-week period a year ago.
Comparable warehouse sales were negatively impacted by the devaluation of the Colombian peso from the year ago period. Six warehouse clubs in Colombia are in the calculation for comparable warehouse sales. Excluding those warehouse clubs, the four-week and thirty-week comparable warehouse sales for the other 30 warehouse clubs open at least 13 ½ full months decreased 3.1% and increased 2.9%, respectively.
PriceSmart management plans to host a conference call at 12:00 p.m. Eastern time (9:00 a.m. Pacific time) on Friday, April 8, 2016, to discuss the financial results. Individuals interested in participating in the conference call may do so by dialing (877) 795-3610 for domestic callers or (719) 325-4776 for international callers, and entering participant code 1201714. A digital replay will be available through April 30, 2016, following the conclusion of the call by dialing (888) 203-1112 for domestic callers, or (719) 457-0820 for international callers, and entering relay passcode 1201714.
About PriceSmart
PriceSmart, headquartered in San Diego, owns and operates U.S.-style membership shopping warehouse clubs in Latin America and the Caribbean, selling high quality merchandise at low prices to PriceSmart members. PriceSmart now operates 38 warehouse clubs in 12 countries and one U.S. territory (six each in Costa Rica and Colombia; five in Panama, four in Trinidad; three each in Guatemala, the Dominican Republic and Honduras; two each in El Salvador and Nicaragua; and one each in Aruba, Barbados, Jamaica and the United States Virgin Islands).
This press release may contain forward-looking statements concerning the Company's anticipated future revenues and earnings, adequacy of future cash flow, proposed warehouse club openings, the Company's performance relative to competitors, the outcome of tax proceedings and related matters. These forward-looking statements include, but are not limited to, statements containing the words expect, believe, will, may, should, project, estimate, anticipated, scheduled, and like expressions, and the negative thereof. These forward-looking statements include, but are not limited to, statements containing the words “expect,” “believe,” “will,” “may,” “should,”
“project,” “estimate,” “anticipated,” “scheduled,” and like expressions, and the negative thereof. These statements are subject to risks and uncertainties that could cause actual results to differ materially, including the following risks: our financial performance is dependent on international operations, which exposes us to various risks; any failure by us to manage our widely dispersed operations could adversely affect our business; we face significant competition; future sales growth depends, in part, on our ability to successfully open new warehouse clubs and grow sales in our existing locations; we might not identify in a timely manner or effectively respond to changes in consumer preferences for merchandise, which could adversely affect our relationship with members, demand for our products and market share; although we have begun to offer limited online shopping to our members, our sales could be adversely affected if one or more major international online retailers were to enter our markets or if other competitors were to offer a superior online experience; our profitability is vulnerable to cost increases; we face difficulties in the shipment of and inherent risks in the importation of, merchandise to our warehouse clubs; we are exposed to weather and other natural disaster risks; general economic conditions could adversely impact our business in various respects; we are subject to risks associated with possible changes in our relationships with third parties with which we do business, as well as the performance of such third parties; we rely extensively on computer systems to process transactions, summarize results and manage our business; failure to adequately maintain our systems and disruptions in our systems could harm our business and adversely affect our results of operations; we could be subject to additional tax liabilities; a few of our stockholders own approximately 27.7% of our voting stock as of February 29, 2016, which may make it difficult to complete some corporate transactions without their support and may impede a change in control; failure to attract and retain qualified employees, increases in wage and benefit costs, changes in laws and other labor issues could materially adversely affect our financial performance; we are subject to volatility in foreign currency exchange rates; we face the risk of exposure to product liability claims, a product recall and adverse publicity; any failure to maintain the security of the information relating to our company, members, employees and vendors that we hold, whether as a result of cybersecurity attacks on our information systems, failure of internal controls, employee negligence or malfeasance or otherwise, could damage our reputation with members, employees, vendors and others, could cause us to incur substantial additional costs and to become subject to litigation and could materially adversely affect our operating results; we are subject to payment related risks; changes in accounting standards and assumptions, estimates and judgments by management related to complex accounting matters could significantly affect our financial condition and results of operations; we face increased public company compliance risks and compliance risks related to our international operations; if remediation costs or hazardous substance contamination levels at certain properties for which we maintain financial responsibility exceed management's current expectations, our financial condition and results of operations could be adversely impacted. The risks described above as well as the other risks detailed in the Company's U.S. Securities and Exchange Commission (“SEC”) reports, including the Company's Annual Report on Form 10-K filed for the fiscal year ended August 31, 2015 filed on October 29, 2015 pursuant to the Securities Exchange Act of 1934. We assume no obligation and expressly disclaim any duty to update any forward- looking statement to reflect events or circumstances after the date of this presentation or to reflect the occurrence of unanticipated events.
For further information, please contact John M. Heffner, Principal Financial Officer and Principal Accounting Officer (858) 404-8826.
