Costco Wholesale Corp. reported net sales of $23.12 billion for the four weeks ended Aug. 2, up 10.7 percent from $20.89 billion a year earlier, the Issaquah, Washington-based retailer said Aug. 5.
U.S. comparable sales rose 10.3 percent for the month, the strongest of the company’s three segments. Canada was up 4.2 percent and other international 6 percent, for a total company gain of 8.9 percent.
Gasoline was key in the results. Andrew Yoon, director of finance and investor relations, said gas price inflation added roughly 2.9 percentage points to total reported comparable sales, with the average worldwide selling price per gallon up 25.2 percent year over year. Excluding changes in gas prices and foreign exchange, U.S. comps rose 6.9 percent and total company comps 6.6 percent. Stripping out all gas sales and currency effects puts total company comps at about 6.7 percent.
Traffic and basket
The underlying demand signal was solid. Comparable traffic rose 3.6 percent worldwide and 3.3 percent in the U.S.
Average transaction was up 5.1 percent worldwide including gas inflation and currency, and up 2.9 percent excluding both. Roughly equal contributions came from more trips and bigger baskets.
Currency ran against the company, cutting Canadian sales by about 3 percent, other international by about 1.5 percent and total company by about 0.6 percent. Cannibalization from new warehouses trimmed about 60 basis points companywide.
What sold
Yoon said comparable sales by category, excluding foreign exchange, broke down as follows:
- Fresh foods: up mid-single digits, with bakery and meat leading;
- Foods and sundries: up low- to mid-single digits, with food, frozen foods and sundries performing best;
- Non-foods: up mid-single digits, led by jewelry, home furnishings and housewares; and
- Ancillary businesses: up in the high 20s, with pharmacy, gas and the food court on top. Gas alone was up in the low 30s on price per gallon.
Regionally, the Midwest, Southeast and San Diego posted the strongest U.S. comps.
Digital keeps outrunning the warehouses
Digitally-enabled comparable sales climbed 17.7 percent for the month and 18.2 percent excluding gas and currency effects. Over 48 weeks, the measure is up 21.2 percent, or 20.9 percent adjusted, roughly triple the total company rate.
Year to date
Net sales for the first 48 weeks totaled $273.55 billion, up 10.1 percent from $248.35 billion. Comparable sales for the period rose 8.4 percent, or 6.7 percent excluding gas and foreign exchange, with the U.S. at 8.1 percent reported and 6.7 percent adjusted.
Costco operates 933 warehouses, including 641 in the U.S. and Puerto Rico, 115 in Canada, 43 in Mexico, 37 in Japan, 29 in the United Kingdom, 20 in Korea, 15 in Australia, 14 in Taiwan, seven in China, five in Spain, three in France, two in Sweden and one each in Iceland and New Zealand. The company also runs e-commerce sites in nine countries.
The August reporting period covers the four weeks beginning Aug. 3 and ending Aug. 30.