UPDATE: Costco Warns 2Q EPS Likely Well Below Street View
2009年2月5日 - 2:46AM
Dow Jones News
Costco Wholesale Corp. (COST) warned Wednesday that its fiscal
second-quarter earnings are likely to come in "substantially below"
analysts' expectations as sales and margins have been hurt by
general economic conditions.
Chief Financial Officer Richard Galanti also said the company
wouldn't be issuing earnings guidance for the remainder of the
fiscal year "given the uncertainties surrounding the economy,
including consumer behavior."
In a statement, Galanti said that margins have been hit
primarily in the non-food and merchandise categories because of
"aggressive merchandise pricing...to drive sales and increase
market share, particularly during the first four weeks of the
fiscal quarter."
Analysts polled by Thomson Reuters expect earnings of 70 cents
per share when Costco releases its financial statements on March
4.
Following its fiscal first-quarter financial report in December,
Costco said it doesn't expect to meet second-quarter projections
but the uncertainty around how bad it's going to be sent shares of
the warehouse club tumbling 8% Wednesday to $42.43 and weighed
heavily on the broader retail sector.
Costco has also been hit by lower year-over-year profits from
its gasoline business and the strengthening U.S. dollar, which ate
into gains from its international operations.
The company said its wholesale same-store sales fell 2% in
January from a year earlier. Same-store sales in the U.S. were flat
in the month while international sales were down 9%.
While Costco has held up relatively well in light of the
economic downturn, industry watchers said the announcement didn't
come as a complete surprise. A painful combination of mounting
unemployment numbers and losses in the stock market have weighed
heavily on consumers.
"When the consumer is being hurt like this, there aren't a lot
of places to hide" and even strong companies will be hit, said
Howard Davidowitz, chairman of Davidowitz & Associates, a
national retail consulting and investment banking firm based in New
York.
"Costco is a bit of a victim of its own success," said FTN
Equity Capital Markets analyst Charles Cerankosky. "They have
historically done better [with discretionary merchandise] so now
when those products aren't moving off the shelves, their bottom
line is going to get hurt."
-By Kejal Vyas; Dow Jones Newswires; 201-938-5460,
kejal.vyas@dowjones.com