Summary
Costco Wholesale Corporation (COST) reported its financial results for the fiscal second quarter and first half ended February 12, 2012. The company demonstrated solid top-line growth, with net sales increasing by 10.1% for the quarter and 11.2% for the first half, driven by comparable warehouse sales growth of 8% and 9% respectively, alongside contributions from new warehouse openings. Membership fees also saw a healthy increase of 7.8% for the quarter, boosted by new member sign-ups and the higher-fee Executive Membership program. While gross margin as a percentage of net sales saw a slight decrease of 30 basis points for the quarter, this was largely offset by an improvement in selling, general, and administrative (SG&A) expenses as a percentage of net sales, leading to a 13.3% increase in net income for the quarter to $394 million, or $0.90 per diluted share. The company continues its expansion strategy, with plans to open additional warehouses in fiscal 2012, supported by a strong liquidity position. Costco also returned capital to shareholders through dividends and share repurchases, highlighting its commitment to shareholder value. The company's operational efficiency, ability to drive comparable sales, and prudent expense management are key strengths evident in these results.
Financial Highlights
47 data points| Revenue | $22.97B |
| Cost of Revenue | $20.14B |
| Gross Profit | $2.83B |
| SG&A Expenses | $2.18B |
| Operating Income | $644.00M |
| Interest Expense | $27.00M |
| Net Income | $394.00M |
| EPS (Basic) | $0.91 |
| EPS (Diluted) | $0.90 |
| Shares Outstanding (Basic) | 434.54M |
| Shares Outstanding (Diluted) | 439.47M |
Key Highlights
- 1Net sales increased by 10.1% to $22,508 million for the second quarter and 11.2% to $43,689 million for the first half, reflecting strong demand.
- 2Comparable warehouse sales grew by 8% for the second quarter and 9% for the first half, indicating sustained customer traffic and spending.
- 3Membership fees increased by 7.8% in the quarter, driven by new member acquisition and increased penetration of the Executive Membership program.
- 4Net income grew by 13.3% to $394 million in the second quarter, with diluted earnings per share rising to $0.90 from $0.79 in the prior year.
- 5Selling, General & Administrative (SG&A) expenses as a percentage of net sales improved by 29 basis points in the quarter, demonstrating effective cost management.
- 6The company repurchased $145 million of common stock in the second quarter and maintained a strong liquidity position with $5,785 million in cash and short-term investments.
- 7Costco declared a quarterly cash dividend of $0.24 per share, reflecting its commitment to returning capital to shareholders.