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Costco's profit boosted by higher membership fees, strong U.S. sales
May 25, 2017 / 8:39 PM / 6 months ago

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

(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.

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

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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