SOURCE: PriceSmart, Inc.

March 08, 2006 08:00 ET

PriceSmart Announces February Sales

Panama Land Acquisition Also Announced

SAN DIEGO, CA -- (MARKET WIRE) -- March 8, 2006 -- PriceSmart, Inc. (NASDAQ: PSMT) today announced that for the month of February 2006, net sales increased 19.8% to $52.4 million from $43.8 million in February a year earlier. For the six months ended February 28, 2006, net sales increased 19.2% to $356.1 million from $298.8 million in the same period last year. There were 23 warehouse clubs in operation at the end of February 2006 compared to 22 warehouse clubs in operation in February 2005. Net sales exclude sales from discontinued operations.

For the five weeks ended March 5, 2006, comparable warehouse sales for warehouse clubs open at least 12 full months increased 15.9% compared to the same five-week period last year. For the twenty-six weeks ended March 5, 2006, comparable warehouse sales, for warehouse clubs open at least 12 full months, increased 16.7% from the same period a year ago. Comparable warehouse sales for the comparable twenty-six-week period of 2005 exclude sales from discontinued operations.

Discontinued operations refer to the operations of the Company's PriceSmart Philippines subsidiary. The Company sold its interest in PriceSmart Philippines on August 12, 2005.

The Company also announced it purchased a 4,825 square meter parcel adjacent to its Via Brasil warehouse club in Panama City, Panama for a net $3.0 million during the month of February. The acquisition is part of a plan to expand the Via Brasil club by approximately 1,260 square meters, and develop the acquired site for commercial tenants.

About PriceSmart

PriceSmart, headquartered in San Diego, owns and operates U.S.-style membership shopping warehouse clubs in Central America and the Caribbean, selling high quality merchandise at low prices to PriceSmart members. PriceSmart now operates 23 warehouse clubs in 11 countries and one U.S. territory (four each in Panama and Costa Rica; two each in Dominican Republic, El Salvador, Guatemala, Honduras, and Trinidad; and one each in Aruba, Barbados, Jamaica, Nicaragua and the United States Virgin Islands). On August 12, 2005, PriceSmart completed the sale of its interest in its PriceSmart Philippines subsidiary.

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 a substantial net losses in fiscal 2003, 2004 and 2005, and may continue to incur losses in future periods; if the Company fails to comply with covenants governing its indebtedness, the lenders may elect to accelerate the Company's indebtedness and foreclose on the collateral pledged to secure the indebtedness; 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-Q filed pursuant to the Securities Exchange Act of 1934 on January 17, 2006. 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. Certain prior period amounts may have been reclassified to conform to the current period presentation.

For further information, please contact Robert E. Price, Interim Chief Executive Officer (858) 551-2336; or John M. Heffner, Executive Vice President and Chief Financial Officer (858) 404-8826.

Contact Information

  • Contact:
    Robert E. Price
    Interim Chief Executive Officer
    (858) 551-2336

    John M. Heffner
    Executive Vice President and Chief Financial Officer
    (858) 404-8826