COSTCO WHOLESALE CORPORATION REPORTS FIRST QUARTER
FISCAL 2000 OPERATING RESULTS AND ANNOUNCES UPCOMING 2-FOR-1 STOCK SPLIT
ISSAQUAH, Wash., December 9 3/4 Costco Wholesale Corporation ("Costco" or
the "Company") (Nasdaq:COST) announced today its operating results for the first
quarter of fiscal 2000, the 12 weeks ended November 21, 1999.
Sales for the first quarter of fiscal 2000 increased 16% to $6.82 billion
from $5.89 billion during the first quarter of fiscal 1999. On a comparable
warehouse basis, that is warehouses open at least a year, net sales increased by
13%.
Net income for the first quarter of fiscal 2000 was $129.3 million, or $.56
per diluted share. Excluding the impact of a one-time accounting charge taken in
last year's first quarter, net income for the first quarter of fiscal 1999 was
$104.2 million, or $.46 per diluted share, resulting in year-over-year earnings
and earnings per share increases of 24% and 22%, respectively. In last year's
first quarter, the Company recorded a $118 million non-cash, after-tax charge,
reflecting the cumulative effect of the Company's change in accounting for
membership fees from a cash to a deferred method, whereby membership fee income
is recognized ratably over the one-year life of the membership. Including this
one-time charge, the Company last year reported a loss of $13.8 million or $.05
per diluted share for the first quarter of fiscal 1999.
The Company also announced today that its Board of Directors approved a
2-for-1 split of its common stock. Shareholders will receive one additional
share of common stock for every share held on the record date of December 24,
1999. Additional shares will be mailed or delivered on or about January 13,
2000, by the Company's transfer agent, ChaseMellon Shareholder Services. The
common stock will begin trading at a post-split price on January 14, 2000.
Costco currently operates 302 warehouses, including 230 in the United
States, 59 in Canada, seven in the United Kingdom, three in Korea, two in Taiwan
and a warehouse in Japan. The Company also operates 17 warehouses in Mexico with
a joint venture partner. The Company plans to open an additional 15 to 20 new
warehouses (including four to six relocations of existing warehouses to larger
and better-located facilities) prior to the end of its fiscal year 2000 on
September 3, 2000.
CONTACTS: Costco Wholesale Corporation
Richard Galanti, 425/313-8203
Bob Nelson, 425/313-8255
COSTCO WHOLESALE CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(dollars in thousands, except per share data)
(unaudited)
12 Weeks Ended
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November 21, 1999 November 22, 1998
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REVENUE
Net sales............................................................. $ 6,824,197 $ 5,894,238
Membership fees and other............................................. 119,315 103,840
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Total revenue........................................................ 6,943,512 5,998,078
OPERATING EXPENSES
Merchandise costs..................................................... 6,120,201 5,287,785
Selling, general and administrative................................... 596,717 518,990
Preopening expenses................................................... 10,334 10,707
Provision for impaired assets and warehouse closing costs............. 1,000 2,000
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Operating income..................................................... 215,260 178,596
OTHER INCOME (EXPENSE)
Interest expense...................................................... (10,397) (10,912)
Interest income and other............................................. 10,667 6,039
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INCOME BEFORE INCOME TAXES AND CUMULATIVE
EFFECT OF ACCOUNTING CHANGE......................................... 215,530 173,723
Provision for income taxes............................................ 86,212 69,489
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INCOME BEFORE CUMULATIVE EFFECT OF
ACCOUNTING CHANGE................................................... 129,318 104,234
Cumulative effect of accounting change, net of tax.................... -- (118,023)
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NET INCOME (LOSS)..................................................... $ 129,318 $ (13,789)
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NET INCOME (LOSS) PER COMMON SHARE:
Basic earnings per share:
Income before cumulative effect of accounting change................ $ .58 $ .48
Cumulative effect of accounting change, net of tax.................. -- (.54)
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Net Income (loss)................................................... $ .58 $ (.06)
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Diluted earnings per share:
Income before cumulative effect of accounting change................ $ .56 $ .46
Cumulative effect of accounting change, net of tax.................. -- (.51)
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Net Income (loss)................................................... $ .56 $ (.05)
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Shares used in calculation (000's)
Basic................................................................ 221,650 217,838
Diluted.............................................................. 236,707 233,387