When Costco's
Good businesses grow in hard times
Despite plummeting consumer confidence and a stagnant labor market, Costco's net sales for the quarter increased by 17% to $27.59 billion from $23.59 billion a year ago. Its net sales for the 52-week 2011 fiscal year, moreover, increased 14% to $87.05 billion from $76.25 billion last year.
Costco's comparable-store sales, the creme de la creme of retail statistics, also increased markedly. The warehouse giant reported same-store sales growth of 12% and 10% for the fiscal quarter and year, respectively. And while some of the increase resulted from higher gasoline prices and favorable currency conversions, without these effects the results would have nevertheless been impressive, coming in at 7% and 6% -- both of which are markedly above competitors like Wal-Mart
Costco's diluted earnings per share for the quarter were $1.08, compared with $0.97 a year ago, and for the fiscal year they was $3.30, compared with $2.92 in fiscal 2010.
Outlook going forward
Beyond these stellar numbers, the most promising news from the earnings release was the announcement that Costco will increase its annual membership fees by 10%, as virtually all of Costco's profit derives from these fees. Goldstar and Business members will now pay $55, as opposed to $50. And Executive members will pay $110, as opposed to $100.
Customers recently greeted similar fee increases by Bank of America
Foolish bottom line
Given that today was likely to be Jim Sinegal's last conference call as Costco's CEO, share your thoughts below on the future of Costco without him. And be sure to add Costco to your Watchlist to track the success of this retail superstar.