Costco Wholesale Corp.'s (COST) fiscal fourth-quarter earnings
fell 6% as it continued to suffer from weak sales, higher employee
benefit costs and lower foreign earnings due to the strength of the
dollar, although it reported higher sales in recent weeks.
The warehouse retailer, which sells items in bulk to its paid
members, has battled a consumer-spending cutback in a weakened
economy that has led to the company missing analysts' earnings
expectations in each of the first three quarters of the fiscal
year.
Meanwhile, smaller rival BJ's Wholesale Corp. (BJ) has
outperformed Costco in terms of sales this year as consumers
increasingly flock to discounters.
For the quarter ended Aug. 30, the company posted a profit of
$374 million, or $0.85 a share, down from $398 million, or $0.90 a
share, a year earlier. Revenue fell 3.1% to $22.38 billion.
Analysts surveyed by Thomson Reuters had projected earnings of
77 cents and revenue of $22.34 billion.
Sales in the period fell 3% to $21.9 billion, with same-store
sales excluding currency changes and gasoline sales rising 1%. It
fell 1% in the U.S.
However, the company said that for the five weeks ended Oct. 4,
net sales were $6.85 billion, a 3% increase on the prior year
period. Same-store sales excluding currency changes and gasoline
sales rose 4%, including a 3% increase in the U.S..
Costco shares closed Tuesday at $57.93.
-By Nathan Becker and Steve McGrath, Dow Jones Newswires;
212-416-2855; nathan.becker@dowjones.com