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Costco's profit boosted by higher membership fees, strong U.S. sales
May 25, 2017 / 8:39 PM / 3 months ago

Costco's profit boosted by higher membership fees, strong U.S. sales

FILE PHOTO: A Costco Wholesale retail club is photographed in Austin, Texas, U.S. on December 12, 2016.Mohammad Khursheed/File Photo

(Reuters) - Warehouse club operator Costco Wholesale Corp (COST.O) reported a better-than-expected quarterly profit on Thursday, helped by higher membership fees and strong sales in the United States.

Membership fees, which accounted for about 72 percent of Costco's operating income in 2016, rose 4 percent in the third quarter ended May 7.

Sales at established stores open at least a year rose 5 percent, excluding the impact of changes in gasoline prices and foreign exchange.

Analysts on average were expecting same-store sales to rise 3.7 percent, according to research firm Consensus Metrix.

Net income attributable to Costco rose to $700 million, or $1.59 per share, in the latest quarter from $545 million, or $1.24 per share, a year earlier.

Excluding items, Costco earned $1.40 per share. The company recorded a tax benefit of 19 cents per share related to a special cash dividend announced in April.

Total sales rose 8 percent to $28.86 billion.

Analysts on average had estimated adjusted earnings of $1.31 per share and revenue of $28.54 billion, according to Thomson Reuters I/B/E/S.

Costco shares were up 1.7 percent at $177.50 in aftermarket trading on Thursday.

Reporting by Siddharth Cavale in Bengaluru; Editing by Anil D'Silva

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