Planet Retail on Costco’s Q2 Results
Costco Wholesale Corp.’s winning streak continues as the chain reported a better-than-expected 39% increase in profits for its fiscal second quarter. Here is Planet Retail’s take on the company’s most recent performance and future prospects:
“Costco continues to outperform its peers in terms of overall sales growth, comparable club gains, and space and SKU productivity,” said Sandy Skrovan, U.S. research director, Planet Retail. “The retailer’s ability to keep members engaged and coming back for more is unparalleled. It has some of the most loyal customers across retailing.”
Based on a mid-year assessment, Planet Retail remains optimistic about the company’s future growth prospects.
Skrovan added: “A re-acceleration of club expansion efforts, both in the US and abroad, and advances in e-commerce on a global perspective will propel the retailer forward. Five years ago, international operations generated less than a quarter of Costco sales. Five years from now, we project a third will come from international.
“By 2018, Costco will have doubled its sales in the space of a decade, a remarkable feat considering it’s the result of entirely organic growth.”
Profits up at Urban Outfitters
PHILADELPHIA — Net income rose to $83 million at Urban Outfitters for its fourth quarter from $39.26 million in the year-ago period, on strong same-store sales and higher revenue.
Total company net sales for the quarter increased 17% to $857 million. Comparable retail segment net sales, which include comparable direct-to-consumer channel, increased 11% for the quarter, while comparable-store net sales were flat.
Comparable retail segment net sales at Free People, Urban Outfitters and Anthropologie increased 37%, 11% and 7%, respectively. Direct-to-consumer net sales surged 44% and wholesale segment net sales grew 22% for the quarter.
Sales from Urban Outfitters grew 16.5%, while Anthropologie sales rose 11.9%. Free People sales surged 39.9%.
For the year ended January 31, 2013, total company net sales increased to $2.8 billion or 13% over the prior year.
"We entered the year with a plan to invest in initiatives to drive top line growth and improve margins,” said CEO Richard A. Hayne. “We succeeded on both fronts especially in the fourth quarter. We will pursue a similar strategy in the current fiscal year as we believe we have only begun to unlock the opportunities ahead of us.”
Costco profit surges 39%, beating expectations
Issaquah, Wash. — Costco Wholesale Corp posted a better-than expected 39% increase in quarterly profit, helped by increasing sales and a rise in membership fees.
Net income was $547 million in the fiscal second quarter ended on Feb. 17, compared with $394 million a year ago.
“Costco continues to outperform its peers in terms of overall sales growth, comparable club gains, and space and SKU productivity,” commented Sandy Skrovan, U.S. research director. “The retailer’s ability to keep members engaged and coming back for more is unparalleled. It has some of the most loyal customers across retailing.”
The company’s net sales for the quarter rose 8% to $24.34 billion. Total same-store sales rose 5%
Membership fee revenue increased 15% to $528 million in the second quarter.