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Costco Wholesale Corporation Reports Second Quarter and Year-to-Date Operating Results for Fiscal Year 2012, and February Sales Results

ISSAQUAH, WA, Feb 29, 2012 (MARKETWIRE via COMTEX) --Costco Wholesale Corporation ("Costco" or the "Company") (NASDAQ: COST) announced today its operating results for the second quarter (twelve weeks) and first half (24 weeks) of fiscal 2012, ended February 12, 2012, and its sales results for the four weeks ended February 26, 2012.

Net sales for the quarter increased ten percent, to $22.51 billion, from $20.45 billion last year. Net sales for the first half increased eleven percent, to $43.69 billion, from $39.27 billion last year.

Comparable sales were as follows:


                                     12 Weeks     24 Weeks
                                   ------------ ------------
               U.S.                     8%           9%
               International            8%           9%

               Total                    8%           9%
                                   ============ ============


Inflation in gasoline prices had a positive impact on comparable sales, particularly for the twenty-four-week period; foreign currencies had a negative impact, particularly for the twelve-week period. Excluding these effects, comparable sales were as follows:


                                     12 Weeks     24 Weeks
                                   ------------ ------------
               U.S.                     7%           7%
               International            10%          10%

               Total                    7%           7%
                                   ============ ============


Net income for the quarter was $394 million, or $.90 per diluted share, compared to $348 million, or $.79 per diluted share, last year. Net income for the first half was $714 million, or $1.62 per diluted share, compared to $660 million, or $1.49 per diluted share, last year.

The Company today also reported net sales of $7.04 billion for the four weeks ended February 26, 2012, an increase of ten percent from $6.38 billion in the same four-week period of the prior fiscal year. For the six-month retail reporting period of September through February, the twenty-six weeks ended February 26, 2012, which includes the first two weeks of the Company's fiscal third quarter, the Company reported net sales of $47.22 billion, an increase of eleven percent from $42.46 billion during the comparable period of the prior fiscal year.

Comparable sales for the 4-week retail-reporting month of February and the 26-week retail-reporting period of September through February were as follows:


                                      4 Weeks     26 Weeks
                                   ------------ ------------
               U.S.                     8%           9%
               International            8%           9%

               Total                    8%           9%
                                   ============ ============


Inflation in gasoline prices had a positive impact on comparable sales, particularly for the twenty-six week period; foreign currencies had a negative impact for both periods. Excluding these effects, comparable sales were as follows:


                                      4 Weeks     26 Weeks
                                   ------------ ------------
               U.S.                     7%           7%
               International            9%           10%

               Total                    7%           7%
                                   ============ ============


Costco currently operates 600 warehouses, including 433 in the United States and Puerto Rico, 82 in Canada, 32 in Mexico, 22 in the United Kingdom, 13 in Japan, eight in Taiwan, seven in Korea and three in Australia. The Company also operates Costco Online, an electronic commerce web site, at www.costco.com and at www.costco.ca in Canada. The Company plans to open up to an additional ten new warehouses (including the relocation of a warehouse to a larger and better-located facility) prior to the end of its fifty-three-week fiscal year on September 2, 2012.

A conference call to discuss these second quarter operating results and February sales is scheduled for 8:00 a.m. (PT) today, February 29, 2012, and is available via a webcast on www.costco.com (click on Investor Relations and "Play Webcast").

Certain statements contained in this document constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. For these purposes, forward-looking statements are statements that address activities, events, conditions or developments that the Company expects or anticipates may occur in the future. Such forward-looking statements involve risks and uncertainties that may cause actual events, results or performance to differ materially from those indicated by such statements. These risks and uncertainties include, but are not limited to, domestic and international economic conditions, including exchange rates, the effects of competition and regulation, uncertainties in the financial markets, and consumer and small business spending patterns and debt levels, conditions affecting the acquisition, development, ownership or use of real estate, actions of suppliers, rising costs associated with employees (including health care costs), energy and certain commodities, geopolitical conditions, and other risks identified from time to time in the Company's public statements and reports filed with the Securities and Exchange Commission.


                        COSTCO WHOLESALE CORPORATION
                CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                (dollars in millions, except per share data)
                                (unaudited)

                           12 Weeks Ended              24 Weeks Ended
                     --------------------------  --------------------------
                     February 12,  February 13,  February 12,  February 13,
                         2012          2011          2012          2011
                     ------------  ------------  ------------  ------------
REVENUE
  Net sales          $     22,508  $     20,449  $     43,689  $     39,272
  Membership fees             459           426           906           842
                     ------------  ------------  ------------  ------------
    Total revenue          22,967        20,875        44,595        40,114
OPERATING EXPENSES
  Merchandise costs        20,139        18,235        39,070        34,992
  Selling, general
   and
   administrative           2,176         2,038         4,321         3,979
  Preopening
   expenses                     6             4            16            16
  Provision for
   impaired assets
   and closing
   costs, net.                  2             2             1             6
                     ------------  ------------  ------------  ------------
    Operating income          644           596         1,187         1,121
OTHER INCOME
 (EXPENSE)
  Interest expense            (27)          (27)          (54)          (53)
  Interest income
   and other, net              10             4            47             9
                     ------------  ------------  ------------  ------------
INCOME BEFORE INCOME
 TAXES                        627           573         1,180         1,077
  Provision for
   income taxes               215           204           440           376
                     ------------  ------------  ------------  ------------
Net income including
 noncontrolling
 interests                    412           369           740           701

Net income
 attributable to
 noncontrolling
 interests                    (18)          (21)          (26)          (41)
                     ------------  ------------  ------------  ------------
NET INCOME
 ATTRIBUTABLE TO
 COSTCO              $        394  $        348  $        714  $        660
                     ============  ============  ============  ============

NET INCOME PER
 COMMON SHARE
 ATTRIBUTABLE TO
 COSTCO:
  Basic              $       0.91  $       0.80  $       1.64  $       1.52
                     ============  ============  ============  ============
  Diluted            $       0.90  $       0.79  $       1.62  $       1.49
                     ============  ============  ============  ============

Shares used in
 calculation (000's)
  Basic                   434,535       436,682       434,374       435,385
  Diluted                 439,468       443,186       440,036       442,283


Cash dividends
 declared per share  $      0.240  $      0.205  $      0.480  $      0.410


                        COSTCO WHOLESALE CORPORATION
                    CONDENSED CONSOLIDATED BALANCE SHEETS
                            (dollars in millions)
                                 (unaudited)
Subject to Reclassifications
                                                   February 12,  August 28,
                                                       2012         2011
                                                   ------------ ------------
                      ASSETS
Cash and cash equivalents                          $      4,389 $      4,009
Short-term investments                                    1,396        1,604
Receivables, net                                          1,092          965
Merchandise inventories                                   6,934        6,638
Deferred income taxes and other current assets              549          490
                                                   ------------ ------------
  Total current assets                                   14,360       13,706
Property and equipment, net                              12,519       12,432
Other assets                                                632          623
                                                   ------------ ------------
TOTAL ASSETS                                       $     27,511 $     26,761
                                                   ============ ============

              LIABILITIES AND EQUITY

Current portion of long-term debt                  $        900 $        900
Accounts payable                                          6,334        6,544
Other current liabilities                                 5,175        4,606
                                                   ------------ ------------
  Total current liabilities                              12,409       12,050
Long-term debt, excluding current portion                 1,380        1,253
Deferred income taxes and other liabilities                 903          885
                                                   ------------ ------------
  Total liabilities                                      14,692       14,188
                                                   ------------ ------------

Total Costco stockholders' equity                        12,232       12,002
Noncontrolling interests                                    587          571
                                                   ------------ ------------
  Total equity                                           12,819       12,573
                                                   ------------ ------------
TOTAL LIABILITIES AND EQUITY                       $     27,511 $     26,761
                                                   ============ ============

CONTACTS:
Costco Wholesale Corporation
Richard Galanti
425/313-8203
Bob Nelson
425/313-8255
Jeff Elliott
425/313-8264


SOURCE: Costco

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