PriceSmart Announces First
Quarter Results of Operations;
New
For the first quarter
of fiscal year 2008, net warehouse sales increased 23.8% to $245.2 million from
$198.1 million in the first quarter of fiscal year 2007. Total revenue for the first quarter was
$250.4 million compared to $202.5 million in the prior year. The Company had 24 warehouse clubs in
operation as of November 30, 2007 compared to 23 warehouse clubs in operation
as of November 30, 2006.
The Company recorded
operating income in the quarter of $10.2 million, compared to operating income
of $7.2 million in the prior year. Net
income was $6.7 million, or $0.23 per diluted share, in the first quarter of
fiscal 2008 compared to $4.1 million, or $0.14 per diluted share, in the first
quarter of fiscal 2007.
On December 13, 2007,
the Company successfully opened its third warehouse club in
The Company also
announced that for the month of December 2007, net sales increased 25.3% to
$122.6 million from $97.8 million in December a year earlier. For the four months ended December 31, 2007,
net sales increased 24.3% to $367.8 million from $296.0 million in the
same period last year. There were 25
warehouse clubs in operation at the end of December 2007 compared to 23
warehouse clubs in operation in December 2006.
For the four weeks
ended December 30, 2007, comparable warehouse sales for warehouse clubs open at
least 12 full months increased 19.8% compared to the same four-week period last
year. For the seventeen-week period
ended December 30, 2007, comparable warehouse sales increased 21.6% compared to
the comparable seventeen-week period a year ago.
About PriceSmart
PriceSmart,
headquartered in
This press release may contain
forward-looking statements concerning the Company's anticipated future revenues
and earnings, adequacy of future cash flow and related matters. These
forward-looking statements include, but are not limited to, statements
containing the words "expect," "believe," "will,"
"may," "should," "project," "estimate,"
"scheduled," and like expressions, and the negative thereof. These
statements are subject to risks and uncertainties that could cause actual
results to differ materially, including the following risks: the Company had
substantial net losses in fiscal 2003, 2004 and 2005, and may not be able to
sustain the profitability it achieved in fiscal 2006 in future periods; the
Company’s financial performance is dependent on international operations which
exposes the Company to various risks; any failure by the Company to manage its
widely dispersed operations could adversely affect the Company’s business;
although the Company has taken and continues to take steps to improve
significantly its internal controls, there may be material weaknesses or
significant deficiencies that the Company has not yet identified; the Company
faces significant competition; the Company faces difficulties in the shipment
of and inherent risks in the importation of merchandise to its warehouse clubs;
the Company is exposed to weather and other risks associated with international
operations; declines in the economies of the countries in which the Company
operates its warehouse clubs would harm its business; a few of the Company’s
stockholders have control over the Company's voting stock, which will make it
difficult to complete some corporate transactions without their support and may
prevent a change in control; the loss of key personnel could harm the Company’s
business; the Company is subject to volatility in foreign currency exchange;
the Company faces the risk of exposure to product liability claims, a product
recall and adverse publicity; a determination that the Company's long-lived or
intangible assets have been impaired could adversely affect the Company's
future results of operations and financial position; and the Company faces
increased costs and compliance risks associated with compliance with Section
404 of the Sarbanes-Oxley Act of 2002; as well as the other risks detailed in
the Company's SEC reports, including the Company's Form 10-K filed pursuant to
the Securities Exchange Act of 1934 on November 29, 2007. We assume no
obligation and expressly disclaim any duty to update any forward-looking
statement to reflect events or circumstances after the date of this
presentation or to reflect the occurrence of unanticipated events.
For further
information, please contact Robert E. Price, Chief Executive Officer (858)
551-2336; or John M. Heffner, Executive Vice President and Chief Financial
Officer (858) 404-8826.
PRICESMART, INC.
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED—AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA)
|
|
|
Three
Months Ended November 30, |
|
||||
|
|
|
2007 |
|
|
2006 |
|
|
|
Revenues: |
|
|
|
|
|
|
|
|
Sales: |
|
|
|
|
|
|
|
|
Net warehouse club |
|
$ |
245,189 |
|
$ |
198,100 |
|
|
Export |
|
|
367 |
|
|
95 |
|
|
Membership income |
|
|
3,742 |
|
|
3,241 |
|
|
Other income |
|
|
1,113 |
|
|
1,061 |
|
|
Total revenues |
|
|
250,411 |
|
|
202,497 |
|
|
Operating expenses: |
|
|
|
|
|
|
|
|
Cost of goods sold: |
|
|
|
|
|
|
|
|
Net warehouse club |
|
|
208,511 |
|
|
168,498 |
|
|
Export |
|
|
349 |
|
|
92 |
|
|
Selling, general and administrative: |
|
|
|
|
|
|
|
|
Warehouse club operations |
|
|
23,227 |
|
|
20,293 |
|
|
General and administrative |
|
|
7,316 |
|
|
5,968 |
|
|
Preopening expenses |
|
|
772 |
|
|
232 |
|
|
Asset impairment and closure costs |
|
|
19 |
|
|
191 |
|
|
Total operating
expenses |
|
|
240,194 |
|
|
195,274 |
|
|
Operating income |
|
|
10,217 |
|
|
7,223 |
|
|
Other income (expense): |
|
|
|
|
|
|
|
|
Interest income |
|
|
410 |
|
|
364 |
|
|
Interest expense |
|
|
(59) |
|
|
(355 |
) |
|
Other income (expense), net |
|
|
(47) |
|
|
14 |
|
|
Total other income
|
|
|
304 |
|
|
23 |
|
|
Income from continuing operations before provision
for income taxes, loss of unconsolidated affiliate and minority interest |
|
|
10,521 |
|
|
7,246 |
|
|
Provision for income taxes |
|
|
(3,715) |
|
|
(2,973 |
) |
|
Loss of unconsolidated affiliate |
|
|
— |
|
|
(85) |
|
|
Minority interest |
|
|
(130) |
|
|
(134 |
) |
|
Income from continuing
operations |
|
|
6,676 |
|
|
4,054 |
|
|
Discontinued operations, net
of tax |
|
|
18 |
|
|
18 |
|
|
Net income |
|
$ |
6,694 |
|
$ |
4,072 |
|
|
|
|
|
|
|
|
|
|
|
Basic income per share: |
|
|
|
|
|
|
|
|
Continuing operations |
|
$ |
0.23 |
|
$ |
0.14 |
|
|
Discontinued operations, net of tax |
|
$ |
— |
|
$ |
— |
|
|
Net income |
|
$ |
0.23 |
|
$ |
0.14 |
|
|
Diluted income per share: |
|
|
|
|
|
|
|
|
Continuing operations |
|
$ |
0.23 |
|
$ |
0.14 |
|
|
Discontinued operations, net of tax |
|
$ |
— |
|
$ |
— |
|
|
Net income |
|
$ |
0.23 |
|
$ |
0.14 |
|
|
|
|
|
|
|
|
|
|
|
Shares used in per share computations: |
|
|
|
|
|
|
|
|
Basic |
|
|
28,781 |
|
|
28,429 |
|
|
Diluted |
|
|
29,494 |
|
|
29,105 |
|
|
|
|
|
|
|
|
|
|
PRICESMART, INC.
CONSOLIDATED BALANCE SHEETS
(UNAUDITED - AMOUNTS IN THOUSANDS, EXCEPT
SHARE DATA)
|
|
|
|
|
ASSETS |
|
|
|
Current Assets: |
|
|
|
Cash and cash equivalents.................................................................................................................................................. |
$ 19,269 |
$ 32,065 |
|
Short-term restricted cash................................................................................................................................................... |
8,155 |
8,046 |
|
Receivables, net of allowance for doubtful accounts of $8 and $3 in 2007 and 2006, respectively.................................................... |
2,429 |
2,705 |
|
Merchandise inventories..................................................................................................................................................... |
120,872 |
95,979 |
|
Prepaid expenses and other current assets............................................................................................................................... |
16,907 |
15,777 |
|
Assets of discontinued operations........................................................................................................................................ |
1,491 |
1,380 |
|
|
|
|
|
Total current assets...................................................................................................................................................................... |
169,123 |
155,952 |
|
Long-term restricted cash.................................................................................................................................................... |
457 |
477 |
|
Notes receivable................................................................................................................................................................ |
2,085 |
2,086 |
|
Property and equipment, net............................................................................................................................................... |
197,479 |
179,985 |
|
Goodwill......................................................................................................................................................................... |
31,594 |
31,652 |
|
Deferred tax assets............................................................................................................................................................. |
19,396 |
19,535 |