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Costco Wholesale Corporation Reports First Quarter Fiscal Year 2015 Operating Results

ISSAQUAH, WA -- (Marketwired) -- 12/10/14 -- Costco Wholesale Corporation ("Costco" or the "Company") (NASDAQ: COST) announced today its operating results for the first quarter (twelve weeks) of fiscal 2015, ended November 23, 2014.

Net sales for the quarter increased seven percent, to $26.28 billion from $24.47 billion during the first quarter last year. Comparable sales for the first quarter of fiscal 2015 were as follows:

12 Weeks
U.S. 6%
International 1%
Total Company 5%

Comparable sales for the twelve-week period, excluding negative impacts from gasoline price deflation and foreign exchange, were as follows:

12 Weeks
U.S. 7%
International 7%
Total Company 7%

Net income for the quarter was $496 million, or $1.12 per diluted share, compared to $425 million, or $0.96 per diluted share, last year.

Costco currently operates 671 warehouses, including 474 in the United States and Puerto Rico, 88 in Canada, 34 in Mexico, 26 in the United Kingdom, 20 in Japan, 11 in Korea, 10 in Taiwan, seven in Australia and one in Spain. Costco also operates electronic commerce web sites in the U.S., Canada, the United Kingdom and Mexico.

A conference call to discuss these fiscal 2015 first quarter operating results is scheduled for 8:00 a.m. (PT) today, December 10, 2014, 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, consumer and small business spending patterns and debt levels, breaches of security or privacy of member or business information, conditions affecting the acquisition, development, ownership or use of real estate, amounts expected to be spent on expansion plans, actions of vendors, 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
November 23, 2014 November 24, 2013
REVENUE
Net sales $ 26,284 $ 24,468
Membership fees 582 549
Total revenue 26,866 25,017
OPERATING EXPENSES
Merchandise costs 23,385 21,824
Selling, general and administrative 2,696 2,501
Preopening expenses 15 24
Operating income 770 668
OTHER INCOME (EXPENSE)
Interest expense (26 ) (27 )
Interest income and other, net 35 18
INCOME BEFORE INCOME TAXES 779 659
Provision for income taxes 274 228
Net income including noncontrolling interests 505 431
Net income attributable to noncontrolling interests (9 ) (6 )
NET INCOME ATTRIBUTABLE TO COSTCO $ 496 $ 425
NET INCOME PER COMMON SHARE ATTRIBUTABLE TO COSTCO:
Basic $ 1.13 $ 0.97
Diluted $ 1.12 $ 0.96
Shares used in calculation (000's)
Basic 438,760 437,970
Diluted 442,210 442,420
CASH DIVIDENDS DECLARED PER COMMON SHARE $ 0.355 $ 0.31
COSTCO WHOLESALE CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(dollars in millions)
(unaudited)
Subject to Reclassifications
November 23,
2014
August 31,
2014
ASSETS
Cash and cash equivalents $ 5,969 $ 5,738
Short-term investments 1,650 1,577
Receivables, net 1,248 1,148
Merchandise inventories 9,644 8,456
Deferred income taxes and other current assets 645 669
Total current assets 19,156 17,588
Property and equipment, net 14,798 14,830
Other assets 659 606
TOTAL ASSETS $ 34,613 $ 33,024
LIABILITIES AND EQUITY
Accounts payable $ 9,783 $ 8,491
Accrued salaries and benefits 2,224 2,231
Deferred membership fees 1,305 1,254
Other current liabilities 2,707 2,436
Total current liabilities 16,019 14,412
Long-term debt, excluding current portion 5,034 5,093
Deferred income taxes and other liabilities 990 1,004
Total liabilities 22,043 20,509
Total Costco stockholders' equity 12,359 12,303
Noncontrolling interests 211 212
Total equity 12,570 12,515
TOTAL LIABILITIES AND EQUITY $ 34,613 $ 33,024

CONTACTS:
Costco Wholesale Corporation
Richard Galanti
425/313-8203

Bob Nelson
425/313-8255

Jeff Elliott
425/313-8264

Source: Costco