Home Boosts Costco’s Q4 Net
Posted on October 1, 2015 by
ISSAQUAH, Wash.-Costco ended its fiscal year on Aug. 30 with positive bottom line numbers for both the year and the fourth quarter—thanks, in part, to a strong quarter from the home department.
Home furnishings and domestics were two of the best-performing categories in the quarter, Richard Galanti, executive vice president and chief financial officer, told financial analysts during its quarterly conference call. Galanti also said comparable sales from Costco’s e-commerce sector rose 20 percent for both the quarter and the year.
Net income for the fiscal year jumped 15.5 percent to $2.4 billion, on net sales of $113.7 billion, up 3.1 percent. Same-club sales for the company as a whole rose 7 percent in the year, taking out the negative effects of gasoline price deflation. Adding in the gas factor, same-club sales rose just 1 percent.
For the fourth quarter, Costco’s net income totaled $767 million, up 10 percent. Net sales finished at $35 billion, rising 0.7 percent and including a gain of 6 percent in same-club sales without gas. Factoring in gas, same-club sales fell 1 percent.
Gross margin in the quarter increased 44 basis points to 11.1 percent. Selling, general and administrative expenses increased by 3.5 percent in dollars and 27 basis points as a percentage of sales, to 10 percent.
In announcing its results, Costco also said it is planning to open 12 new warehouses by the end of this calendar year. It currently operates 686 warehouses, 480 of which are in the United States and Puerto Rico.