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Exhibit 99.1
| Press Release |
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COSTCO WHOLESALE CORPORATION REPORTS FOURTH QUARTER AND
FISCAL YEAR 2017 OPERATING RESULTS AND SEPTEMBER SALES RESULTS
ISSAQUAH, Wash., October 5, 2017- Costco Wholesale Corporation (“Costco” or the “Company”) (Nasdaq: COST) today announced its operating results for the 17-week fourth quarter and the 53-week fiscal year ended September 3, 2017.
Net sales for the 17-week fourth quarter were $41.36 billion, an increase of 15.8 percent from $35.73 billion in the 16-week fourth quarter of fiscal 2016. Net sales for the 53-week fiscal year were $126.17 billion, an increase of 8.7 percent from $116.07 billion in the 52-week fiscal year of 2016.
The Company today also reported net sales of $12.40 billion for the month of September, the five weeks ended October 1, 2017, an increase of 12.1 percent from $11.06 billion during the similar period last year. (The five-week period this year included the last week of the 53-week fiscal year 2017 ended September 3, 2017).
Comparable sales for the 17-week fourth quarter, the 53-week fiscal year, and the 5-week September retail sales month were as follows:
| 17 Weeks | 53 Weeks | Sept. 5 Weeks | ||||||||||
| U.S. |
6.5 | % | 4.4 | % | 9.0 | % | ||||||
| Canada |
4.9 | % | 4.7 | % | 9.4 | % | ||||||
| Other International |
5.6 | % | 2.1 | % | 8.2 | % | ||||||
| Total Company |
6.1 | % | 4.1 | % | 8.9 | % | ||||||
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| E-commerce |
21 | % | 13 | % | 30 | % | ||||||
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Comparable sales for these periods excluding the impacts from changes in gasoline prices and foreign exchange were as follows:
| 17 Weeks | 53 Weeks | Sept. 5 Weeks | ||||||||||
| U.S. |
5.8 | % | 3.7 | % | 7.1 | % | ||||||
| Canada |
4.8 | % | 3.8 | % | 1.4 | % | ||||||
| Other International |
6.0 | % | 4.5 | % | 7.2 | % | ||||||
| Total Company |
5.7 | % | 3.8 | % | 6.2 | % | ||||||
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Net income for the 17-week fourth quarter was $919 million, or $2.08 per diluted share, compared to $779 million, or $1.77 per diluted share, in the 16-week fourth quarter last year.
Net income for the 53-week fiscal year was $2.68 billion, or $6.08 per diluted share, compared to $2.35 billion, or $5.33 per diluted share, in the 52-week prior year. Net income was positively impacted by an $82 million ($0.19 per diluted share) tax benefit in connection with the third-quarter special cash dividend and other net benefits of approximately $51 million ($0.07 per diluted share after tax) for nonrecurring net legal and other matters.
| Press Release |
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Costco ended its 2017 fiscal year with 741 warehouses in operation, including 514 in the United States and Puerto Rico, 97 in Canada, 37 in Mexico, 28 in the United Kingdom, 26 in Japan, 13 in Korea, 13 in Taiwan, nine in Australia, two in Spain, one in France and one in Iceland. Costco also operates e-commerce web sites in the U.S., Canada, the United Kingdom, Mexico, Korea and Taiwan.
A conference call to discuss these fiscal 2017 fourth quarter and year-end operating results and September sales is scheduled for 2:00 p.m. (PT) today, October 5, 2017, and is available via a webcast on www.costco.com (click on Investor Relations and “Play Webcast”).
Certain statements contained in this document constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. For these purposes, forward-looking statements are statements that address activities, events, conditions or developments that the Company expects or anticipates may occur in the future. Such forward-looking statements involve risks and uncertainties that may cause actual events, results or performance to differ materially from those indicated by such statements. These risks and uncertainties include, but are not limited to, domestic and international economic conditions, including exchange rates, the effects of competition and regulation, uncertainties in the financial markets, consumer and small business spending patterns and debt levels, breaches of security or privacy of member or business information, conditions affecting the acquisition, development, ownership or use of real estate, capital spending, actions of vendors, rising costs associated with employees (including health care costs), energy and certain commodities, geopolitical conditions, and other risks identified from time to time in the Company’s public statements and reports filed with the Securities and Exchange Commission. Forward-looking statements speak only as of the date they are made, and the Company does not undertake to update these statements, except as required by law.
CONTACTS: Costco Wholesale Corporation
Richard Galanti, 425/313-8203
Bob Nelson, 425/313-8255
David Sherwood, 425/313-8239
| Press Release |
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COSTCO WHOLESALE CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(dollars in millions, except per share data)
(unaudited)
| 17 Weeks Ended |
16 Weeks Ended |
53 Weeks Ended |
52 Weeks Ended |
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| September 3, 2017 |
August 28, 2016 |
September 3, 2017 |
August 28, 2016 |
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| REVENUE |
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| Net sales |
$ | 41,357 | $ | 35,728 | $ | 126,172 | $ | 116,073 | ||||||||
| Membership fees |
943 | 832 | 2,853 | 2,646 | ||||||||||||
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| Total revenue |
42,300 | 36,560 | 129,025 | 118,719 | ||||||||||||
| OPERATING EXPENSES |
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| Merchandise costs |
36,697 | 31,649 | 111,882 | 102,901 | ||||||||||||
| Selling, general and administrative |
4,123 | 3,696 | 12,950 | 12,068 | ||||||||||||
| Preopening expenses |
30 | 24 | 82 | 78 | ||||||||||||
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| Operating income |
1,450 | 1,191 | 4,111 | 3,672 | ||||||||||||
| OTHER INCOME (EXPENSE) |
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| Interest expense |
(53 | ) | (39 | ) | (134 | ) | (133 | ) | ||||||||
| Interest income and other, net |
22 | 29 | 62 | 80 | ||||||||||||
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| INCOME BEFORE INCOME TAXES |
1,419 | 1,181 | 4,039 | 3,619 | ||||||||||||
| Provision for income taxes |
487 | 396 | 1,325 | 1,243 | ||||||||||||
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| Net income including noncontrolling interests |
932 | 785 | 2,714 | 2,376 | ||||||||||||
| Net income attributable to noncontrolling interests |
(13 | ) | (6 | ) | (35 | ) | (26 | ) | ||||||||
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| NET INCOME ATTRIBUTABLE TO COSTCO |
$ | 919 | $ | 779 | $ | 2,679 | $ | 2,350 | ||||||||
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| NET INCOME PER COMMON SHARE ATTRIBUTABLE TO COSTCO: |
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| Basic |
$ | 2.10 | $ | 1.78 | $ | 6.11 | $ | 5.36 | ||||||||
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| Diluted |
$ | 2.08 | $ | 1.77 | $ | 6.08 | $ | 5.33 | ||||||||
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| Shares used in calculation: (000’s) |
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| Basic |
437,987 | 437,809 | 438,437 | 438,585 | ||||||||||||
| Diluted |
441,036 | 440,868 | 440,937 | 441,263 | ||||||||||||
| Cash dividends declared per common share |
$ | 0.50 | $ | 0.45 | $ | 8.90 | $ | 1.70 | ||||||||
| Press Release |
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COSTCO WHOLESALE CORPORATION
CONSOLIDATED BALANCE SHEETS
(amounts in millions, except par value and share data)
(unaudited)
Subject to Reclassifications
| September 3, 2017 |
August 28, 2016 |
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| ASSETS | ||||||||
| CURRENT ASSETS |
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| Cash and cash equivalents |
$ | 4,546 | $ | 3,379 | ||||
| Short-term investments |
1,233 | 1,350 | ||||||
| Receivables, net |
1,432 | 1,252 | ||||||
| Merchandise inventories |
9,834 | 8,969 | ||||||
| Other current assets |
272 | 268 | ||||||
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| Total current assets |
17,317 | 15,218 | ||||||
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| PROPERTY AND EQUIPMENT |
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| Land |
5,690 | 5,395 | ||||||
| Buildings and improvements |
15,127 | 13,994 | ||||||
| Equipment and fixtures |
6,681 | 6,077 | ||||||
| Construction in progress |
843 | 701 | ||||||
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| 28,341 | 26,167 | |||||||
| Less accumulated depreciation and amortization |
(10,180 | ) | (9,124 | ) | ||||
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| Net property and equipment |
18,161 | 17,043 | ||||||
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| OTHER ASSETS |
869 | 902 | ||||||
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| TOTAL ASSETS |
$ | 36,347 | $ | 33,163 | ||||
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| LIABILITIES AND EQUITY | ||||||||
| CURRENT LIABILITIES |
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| Accounts payable |
$ | 9,608 | $ | 7,612 | ||||
| Current portion of long-term debt |
86 | 1,100 | ||||||
| Accrued salaries and benefits |
2,703 | 2,629 | ||||||
| Accrued member rewards |
961 | 869 | ||||||
| Deferred membership fees |
1,498 | 1,362 | ||||||
| Other current liabilities |
2,639 | 2,003 | ||||||
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| Total current liabilities |
17,495 | 15,575 | ||||||
| LONG-TERM DEBT, excluding current portion |
6,573 | 4,061 | ||||||
| OTHER LIABILITIES |
1,200 | 1,195 | ||||||
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| Total liabilities |
25,268 | 20,831 | ||||||
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| COMMITMENTS AND CONTINGENCIES |
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| EQUITY |
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| Preferred stock $.01 par value; 100,000,000 shares authorized; no shares issued and outstanding |
0 | 0 | ||||||
| Common stock $.01 par value; 900,000,000 shares authorized; 437,204,000 and 437,524,000 shares issued and outstanding |
4 | 2 | ||||||
| Additional paid-in capital |
5,800 | 5,490 | ||||||
| Accumulated other comprehensive loss |
(1,014 | ) | (1,099 | ) | ||||
| Retained earnings |
5,988 | 7,686 | ||||||
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| Total Costco stockholders’ equity |
10,778 | 12,079 | ||||||
| Noncontrolling interests |
301 | 253 | ||||||
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| Total equity |
11,079 | 12,332 | ||||||
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| TOTAL LIABILITIES AND EQUITY |
$ | 36,347 | $ | 33,163 | ||||
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