Exhibit 99.1

 

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COSTCO WHOLESALE CORPORATION REPORTS FOURTH QUARTER AND FISCAL

YEAR 2020 OPERATING RESULTS

ISSAQUAH, Wash., September 24, 2020 - Costco Wholesale Corporation (“Costco” or the “Company”) (Nasdaq: COST) today announced its operating results for the 16-week fourth quarter and the 52-week fiscal year, ended August 30, 2020.

Net sales for the quarter increased 12.5 percent, to $52.28 billion from $46.45 billion last year. Net sales for the fiscal year increased 9.3 percent, to $163.22 billion from $149.35 billion last year.

Comparable sales for the fourth quarter and the fiscal year were as follows:

 

         16 Weeks           16 Weeks           52 Weeks           52 Weeks    
         Adjusted*       Adjusted*

U.S.

   11.0%   13.6%   8.1%   9.2%

Canada

   9.1%   12.6%   5.0%   7.4%

Other International

   16.1%   18.8%   8.9%   11.2%

Total Company

   11.4%   14.1%   7.7%   9.2%
  

 

 

 

 

 

 

 

E-commerce

   90.6%   91.3%   49.5%   50.1%
  

 

 

 

 

 

 

 

*Excluding the impacts from changes in gasoline prices and foreign exchange.

Net income for the fourth quarter was $1.389 billion, or $3.13 per diluted share, compared to $1.097 billion, or $2.47 per diluted share last year. This year’s fourth quarter was negatively impacted by incremental expense related to COVID-19 premium wages and sanitation costs of $281 million pretax ($0.47 per diluted share) and a $36 million pretax charge ($0.06 per diluted share) related to the prepayment of $1.5 billion of debt. These items were partially offset by an $84 million pretax benefit ($0.15 per diluted share) for the partial reversal of a reserve of $123 million pretax ($0.22 cents per diluted share), related to a product tax assessment taken in the fourth quarter of last year.

Net income for the fiscal year was $4.00 billion, or $9.02 per diluted share, compared to $3.66 billion, or $8.26 per diluted share in the prior year.

Costco currently operates 795 warehouses, including 552 in the United States and Puerto Rico, 101 in Canada, 39 in Mexico, 29 in the United Kingdom, 27 in Japan, 16 in Korea, 13 in Taiwan, 12 in Australia, three in Spain, and one each in Iceland, France, and China. Costco also operates e-commerce sites in the U.S., Canada, the United Kingdom, Mexico, Korea, Taiwan, Japan, and Australia.

A conference call to discuss these results is scheduled for 2:00 p.m. (PT) today, September 24, 2020, 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. In some cases forward-looking statements can be identified because they contain words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “likely,” “may,” “might,” “plan,” “potential,” “predict,” “project,” “seek,” “should,” “target,” “will,” “would,” or similar expressions and the negatives of those


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terms. 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 (generally including health-care costs), energy and certain commodities, geopolitical conditions (including tariffs), the ability to maintain effective internal control over financial reporting, COVID-19 related factors and challenges, including among others, the duration of the pandemic, the unknown long-term economic impacts, reduced customer shopping due to illness, travel restrictions or financial hardship, shifts in demand away from discretionary or higher-priced products, reduced workforce due to illness, quarantine, or government mandates, temporary store closures due to reduced workforces or government mandates, or supply-chain disruptions, 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
   Josh Dahmen, 425/313-8254


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COSTCO WHOLESALE CORPORATION

CONSOLIDATED STATEMENTS OF INCOME

(dollars in millions, except per share data)

(unaudited)

 

     16 Weeks Ended   52 Weeks Ended
         August 30,    
2020
      September 1,    
2019
      August 30,    
2020
      September 1,    
2019

REVENUE

        

Net sales

    $ 52,277    $ 46,448    $ 163,220    $ 149,351

Membership fees

     1,106     1,050     3,541     3,352
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total revenue

     53,383     47,498     166,761     152,703

OPERATING EXPENSES

        

Merchandise costs

     46,401     41,310     144,939     132,886

Selling, general and administrative

     5,027     4,684     16,332     14,994

Preopening expenses

     26     41     55     86
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income

     1,929     1,463     5,435     4,737

OTHER INCOME (EXPENSE)

        

Interest expense

     (51     (45     (160     (150

Interest income and other, net

     (9     74     92     178
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

INCOME BEFORE INCOME TAXES

     1,869     1,492     5,367     4,765

Provision for income taxes

     465     382     1,308     1,061
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income including noncontrolling interests

     1,404     1,110     4,059     3,704

Net income attributable to noncontrolling interests

     (15     (13     (57     (45
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NET INCOME ATTRIBUTABLE TO COSTCO

    $ 1,389    $ 1,097    $ 4,002    $ 3,659
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NET INCOME PER COMMON SHARE ATTRIBUTABLE TO COSTCO:         

Basic

    $ 3.14    $ 2.49    $ 9.05    $ 8.32
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted

    $ 3.13    $ 2.47    $ 9.02    $ 8.26
  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shares used in calculation (000’s):

        

Basic

     442,843     439,727     442,297     439,755

Diluted

     444,231     443,400     443,901     442,923


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COSTCO WHOLESALE CORPORATION

CONSOLIDATED BALANCE SHEETS

(amounts in millions, except par value and share data)

(unaudited)

Subject to Reclassification

 

           August 30,      
2020
        September 1,      
2019
ASSETS     
CURRENT ASSETS     

Cash and cash equivalents

    $ 12,277    $ 8,384

Short-term investments

     1,028     1,060

Receivables, net

     1,550     1,535

Merchandise inventories

     12,242     11,395

Other current assets

     1,023     1,111
  

 

 

 

 

 

 

 

Total current assets

     28,120     23,485
OTHER ASSETS     

Property and equipment, net

     21,807     20,890

Operating lease right-of-use assets

     2,788      

Other long-term assets

     2,841     1,025
  

 

 

 

 

 

 

 

TOTAL ASSETS

    $ 55,556    $ 45,400
  

 

 

 

 

 

 

 

LIABILITIES AND EQUITY     
CURRENT LIABILITIES     

Accounts payable

    $ 14,172    $ 11,679

Accrued salaries and benefits

     3,605     3,176

Accrued member rewards

     1,393     1,180

Deferred membership fees

     1,851     1,711

Current portion of long-term debt

     95     1,699

Other current liabilities

     3,728     3,792
  

 

 

 

 

 

 

 

Total current liabilities

     24,844     23,237
OTHER LIABILITIES     

Long-term debt, excluding current portion

     7,514     5,124

Long-term operating lease liabilities

     2,558      

Other long-term liabilities

     1,935     1,455
  

 

 

 

 

 

 

 

TOTAL LIABILITIES

     36,851     29,816
  

 

 

 

 

 

 

 

COMMITMENTS AND CONTINGENCIES EQUITY     

Preferred stock $0.01 par value; 100,000,000 shares authorized; no shares issued and outstanding

            

Common stock $0.01 par value; 900,000,000 shares authorized; 441,255,000 and 439,625,000 shares issued and outstanding

     4     4

Additional paid-in capital

     6,698     6,417

Accumulated other comprehensive loss

     (1,297     (1,436

Retained earnings

     12,879     10,258
  

 

 

 

 

 

 

 

Total Costco stockholders’ equity

     18,284     15,243

Noncontrolling interests

     421     341
  

 

 

 

 

 

 

 

Total equity

     18,705     15,584
  

 

 

 

 

 

 

 

TOTAL LIABILITIES AND EQUITY

    $ 55,556    $ 45,400
  

 

 

 

 

 

 

 

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