Costco reported a 6.0% increase in net sales for the fiscal year ended 1 September 2013 to $102.9bn, with comparable store sales up 6%. Operating income rose by 10.7%, to $3,053m, for the full fiscal year.
Sales increased by 1.0% in the fourth quarter, although this was a 16 week quarter, versus 17 weeks in 2012, with comparable store sales up 5%.
First outlets to open in Spain next year
In its 2013 financial year, the retailer opened 26 new outlets, 12 in the US and 14 internationally. It will accelerate its growth plans over the next 12 months, with 36 new outlets planned, including its first in Spain, which are expected to open next spring and summer. Seven new outlets are planned for Asia, (four in South Korea and three in Japan), five in Australia, three in Canada, one in Mexico and the balance in the US.
Launch of e-commerce in Mexico
The retailer’s online sales continue to achieve double-digit growth, with fourth quarter sales up 15% when adjusted for the extra week in 2012. The retailer has benefited from the re-platforming initiative undertaken in 2012 and the launch of its e-commerce operations in the UK. This autumn it is planning to launch e-commerce operations in Mexico.
Focus on fresh foods price investments
Fresh foods continue to perform strongly for the retailer, benefiting from investment in pricing. Comparative sales for the fourth quarter were in the mid-single digits, with deli and produce delivering the strongest results. In its 2014 financial year, Costco will continue to invest aggressively in fresh food pricing, although there may be some potential upside to margins as sourcing costs are expected to fall.