Costco Q4 2014 Results Earnings Call Transcript

Edited Transcript of Costco Q4 2014 Earnings Conference Call…

Company: Costco Wholesale Corporation (COST))

Event Name: Q4 2014 Results Earnings Conference Call

Date: October 8, 2014 11:00 AM ET

Operator: Good morning. My name is Brandi, and I will be your conference operator today. At this time, I would like to welcome everyone to the Costco fourth quarter earnings conference call and year end conference call. (Operator Instructions)Thank you. Mr. Richard Galanti, CFO. You may begin your conference, sir.

Richard Galanti – CFO

Thank you, Brandi. Good morning to everyone. This morning we reported our 16-week fourth quarter and 52-week fiscal year 2014 operating results, both which ended on August 31. These results are compared to the similar 16-week and 52-week periods in the prior fiscal year ’13, which ended last year on September 1. In addition, we are reporting this morning our September sales results for the five weeks ended this past Sunday, October 5.

I will start by stating that the discussions we are having will include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, and these statements involve risks and uncertainties that may cause actual events, results and/or performance to differ materially from those indicated by such statements. The risks and uncertainties include, but are not limited to, those outlined in today’s call, as well as other risks identified from time to time in the company’s public statements and reports filed with the SEC.

To begin with, our fourth quarter earnings results. For the 16-week fourth quarter, earnings came in at $1.58 a share, up $0.18 or up 13% from last year’s fourth quarter earnings of $1.40.

In terms of sales for the fourth quarter. Total sales were up 9%, comp sales were up 6% on a reported basis, and excluding gas and FX impacts were up 7%. For the quarter, gas prices year over year were essentially flat, so no impact on the 6% U.S. comp figure. However, foreign currencies overall weakened relative to the U.S. dollar year over year in the fourth quarter with the biggest impact in Canada. Such that our reported 6% international comp figure assuming flat year-over-year FX rates would have been up 8%.