SOURCE: PriceSmart, Inc.

PriceSmart, Inc.

January 09, 2013 16:05 ET

PriceSmart Announces First Quarter Results of Operations and December Sales

SAN DIEGO, CA--(Marketwire - Jan 9, 2013) - PriceSmart, Inc. (NASDAQ: PSMT) today announced its results of operations for the first quarter of fiscal year 2013 which ended on November 30, 2012.

For the first quarter of fiscal year 2013, net warehouse club sales increased 11.8% to $523.6 million from $468.2 million in the first quarter of fiscal year 2012. Total revenues for the first quarter of fiscal year 2013 was $535.3 million compared to $477.5 million in the first quarter of the prior year. The Company had 30 clubs in operation as of November 30, 2012, compared to 29 warehouse clubs in operation as of November 30, 2011.

The Company recorded operating income for the first quarter of $29.8 million, compared to operating income of $24.3 million for the first quarter of the prior year. Net income was $20.0 million, or $0.66 per diluted share, in the first quarter of fiscal year 2013. Net income in the first quarter of fiscal year 2012 was $14.0 million, or $0.47 per diluted share.

For the month of December 2012, net sales increased 11.6% to $253.7 million from $227.4 million in December a year earlier. For the four months ended December 31, 2012, net sales increased 11.7% to $777.3 million from $695.6 million in the same period last year. There were 30 warehouse clubs in operation at the end of December 2012 compared to 29 warehouse clubs in operation in December 2011.

For the four weeks ended December 30, 2012, comparable warehouse sales for the 29 warehouse clubs open at least 13 1/2 full months increased 13.7% compared to the same four-week period last year. For the seventeen-week period ended December 30, 2012, comparable warehouse sales increased 9.9% compared to the comparable seventeen-week period a year ago.

PriceSmart management plans to host a conference call at 12:00 p.m. Eastern time (9:00 a.m. Pacific time) on Thursday, January 10, 2013, to discuss the financial results.

Individuals interested in participating in the conference call may do so by dialing (888) 359-3624 toll free, and entering participant code 4470837.

A digital replay will be available through January 31, 2013, following the conclusion of the call by dialing (888) 203-1112 for domestic callers, or (719) 457-0820 for international callers, and entering relay passcode 4470837.

About PriceSmart

PriceSmart, headquartered in San Diego, owns and operates U.S.-style membership shopping warehouse clubs in Latin America and the Caribbean, selling high quality merchandise at low prices to PriceSmart members. PriceSmart now operates 30 warehouse clubs in 12 countries and one U.S. territory (five in Costa Rica; four each in Panama and Trinidad; three each in Guatemala and the Dominican Republic; two each in Colombia, El Salvador, and Honduras; and one each in Aruba, Barbados, Jamaica, Nicaragua and the United States Virgin Islands).

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," "anticipated," "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'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 its business; the Company faces significant competition; future sales growth could be dependent upon the Company acquiring suitable sites for additional warehouse clubs; the Company faces difficulties in the shipment of, and risks inherent in the acquisition and importation of, merchandise to its warehouse clubs; the Company is exposed to weather and other natural disaster risks; general economic conditions could adversely impact the Company's business in various respects; the Company is subject to changes in relationships and agreements with third parties with which the Company does business; a few of the Company's stockholders own nearly 30.4% of the Company's voting stock, which may make it difficult to complete some corporate transactions without their support and may impede 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 rates; 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; although the Company takes steps to continuously review, enhance, and implement improvements to its internal controls, there may be material weaknesses or significant deficiencies that the Company has not yet identified; as well as the other risks detailed in the Company's U.S. Securities and Exchange Commission ("SEC") reports, including the Company's Annual Report on Form 10-K for the fiscal year ended August 31, 2012, filed pursuant to the Securities Exchange Act of 1934 on October 30, 2012. 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.

    Three Months Ended November 30,  
    2012     2011  
Net warehouse club sales   $ 523,599     $ 468,192  
Export sales     3,073       2,249  
Membership income     7,673       6,331  
Other income     941       679  
Total revenues     535,286       477,451  
Operating expenses:                
Cost of goods sold:                
Net warehouse club     444,944       399,865  
Export     2,835       2,161  
Selling, general and administrative:                
Warehouse club operations     45,842       41,891  
General and administrative     11,158       9,111  
Pre-opening expenses     737       162  
Total operating expenses     505,516       453,190  
Operating income     29,770       24,261  
Other income (expense):                
Interest income     294       184  
Interest expense     (1,218 )     (1,254 )
Other income (expense), net     (58 )     (1,269
Total other expense     (982 )     (2,339 )
Income from continuing operations before provision for income taxes and income (loss) of unconsolidated affiliates     28,788       21,922  
Provision for income taxes     (8,779 )     (7,933 )
Income (loss) of unconsolidated affiliates     (4 )     7  
Income from continuing operations     20,005       13,996  
Income (loss) from discontinued operations, net of tax     --       (7 )
Net income     20,005       13,989  
Net income per share available for distribution:                
Basic net income per share from continuing operations   $ 0.66     $ 0.47  
Basic net income (loss) per share from discontinued operations, net of tax   $ --     $ --  
Basic net income per share   $ 0.66     $ 0.47  
Diluted net income per share from continuing operations   $ 0.66     $ 0.47  
Diluted net income (loss) per share from discontinued operations, net of tax   $ --     $ --  
Diluted net income per share   $ 0.66     $ 0.47  
Shares used in per share computations:                
Basic     29,592       29,503  
Diluted     29,604       29,517  
Dividends per share   $ 0.60     $ --  
    November 30,
    August 31,
Current Assets:                
Cash and cash equivalents   $ 84,350     $ 91,248  
Short-term restricted cash     1,220       1,241  
Receivables, net of allowance for doubtful accounts of $1 as of November 30 and August 31, 2012, respectively     6,085       5,786  
Merchandise inventories     239,978       201,043  
Deferred tax assets - current     5,941       5,619  
Prepaid expenses and other current assets     34,628       29,955  
Total current assets     372,202       334,892  
Long-term restricted cash     36,520       36,505  
Property and equipment, net     307,346       299,567  
Goodwill     36,821       36,886  
Deferred tax assets - long term     13,515       14,835  
Other non-current assets     5,395       5,468  
Investment in unconsolidated affiliates     8,105       7,559  
Total Assets   $ 779,904     $ 735,712  
Current Liabilities:                
Accounts payable   $ 200,829     $ 173,197  
Accrued salaries and benefits     12,641       14,729  
Deferred membership income     15,002       13,747  
Income taxes payable     6,690       8,193  
Other accrued expenses     13,834       17,516  
Dividends payable     18,129       --  
Long-term debt, current portion     7,798       7,237  
Deferred tax liability - current     173       122  
Total current liabilities     275,096       234,741  
Deferred tax liability - long-term     2,351       2,191  
Long-term portion of deferred rent     4,368       4,336  
Long-term income taxes payable, net of current portion     2,108       2,512  
Long-term debt, net of current portion     73,165       71,422  
Other long-term liabilities (includes $1.4 million and $1.2 million for the fair value of derivative instruments and $419 and $396 for the defined benefit plans as of November 30 and August 31, 2012, respectively)     1,803       1,596  
Total liabilities     358,891       316,798  
Common stock, $0.0001 par value, 45,000,000 shares authorized; 30,861,245 and 30,855,651 shares issued and 30,215,819 and 30,210,255 shares outstanding (net of treasury shares) as of November 30 and August 31, 2012, respectively.     3       3  
Additional paid-in capital     385,977       384,154  
Tax benefit from stock-based compensation     6,680       6,680  
Accumulated other comprehensive loss     (34,782 )     (33,182 )
Retained earnings     79,615       77,739  
Less: treasury stock at cost; 645,426 as of November 30 and August 31, 2012, respectively.     (16,480 )     (16,480 )
Total equity     421,013       418,914  
Total Liabilities and Equity   $ 779,904     $ 735,712  

Contact Information

  • For further information, please contact
    John M. Heffner
    Principal Financial Officer and Principal Accounting Officer
    (858) 404-8826