SOURCE: PriceSmart, Inc.

PriceSmart, Inc.

October 28, 2014 16:00 ET

PriceSmart Announces Fourth Quarter and Fiscal Year Results of Operations

SAN DIEGO, CA--(Marketwired - Oct 28, 2014) - PriceSmart, Inc. (NASDAQ: PSMT) today announced its results of operations for the fourth quarter and the twelve months of fiscal year 2014 which ended on August 31, 2014.

For the fourth quarter of fiscal year 2014, net warehouse club sales increased 5.6% to $599.6 million from $568.0 million in the fourth quarter of fiscal year 2013. Total revenues for the fourth quarter of fiscal year 2014 were $622.6 million compared to $585.4 million in the comparable period of the prior year. The Company had 33 warehouse clubs in operation as of August 2014 compared to 31 warehouse clubs in operation as of August 2013.

The Company recorded operating income during the quarter of $33.8 million, as compared to operating income of $32.4 million in the prior year. Net income was $21.9 million, or $0.73 per diluted share, in the fourth quarter of fiscal year 2014 as compared to $20.8 million, or $0.69 per diluted share, in the fourth quarter of fiscal year 2013.

For the twelve months ended August 31, 2014, net warehouse club sales increased 9.2% to $2.4 billion from $2.2 billion for the twelve months ended August 31, 2013. Total revenues for the twelve months ended August 31, 2014 increased 9.5% to $2.5 billion from $2.3 billion in the same period of the prior year. For the twelve months ended August 31, 2014, the Company recorded operating income of $136.7 million and net income of $92.9 million, or $3.07 per diluted share. During the twelve months ended August 31, 2013, the Company recorded operating income of $127.0 million and net income of $84.3 million, or $2.78 per diluted share.

The Company plans to file its Annual Report on Form 10-K for the year ended August 31, 2014 on October 30, 2014.

PriceSmart management will host a conference call at 12:00 p.m. Eastern time (9:00a.m. Pacific time) on Wednesday, October 29, 2014, to discuss the financial results. Individuals interested in participating in the conference call may do so by dialing (877) 627-6590 toll free, or (719) 325-4865 for international callers and entering participant code 9101656. A digital replay will be available through November 30, 2014, following the conclusion of the call by dialing (888) 203-1112 for domestic callers, or (719) 457-0820 for international callers, and entering replay passcode 9101656.

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 33 warehouse clubs in 12 countries and one U.S. territory (six in Costa Rica; four each in Panama and Trinidad; three each in Guatemala, the Dominican Republic, Colombia and Honduras; two in El Salvador; 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: our financial performance is dependent on international operations, which exposes us to various risks; any failure by us to manage our widely dispersed operations could adversely affect our business; we face significant competition; future sales growth depends, in part, on our ability to successfully open new warehouse clubs; we might not identify in a timely manner or effectively respond to changes in consumer preferences for merchandise, which could adversely affect our relationship with members, demand for our products and market share; although we have begun to offer limited online shopping to our members, our sales could be adversely affected if one or more major international online retailers were to enter our markets or if other competitors were to offer a superior online experience; we face difficulties in the shipment of, and inherent risks in the importation of, merchandise to our warehouse clubs; we are exposed to weather and other natural disaster risks; general economic conditions could adversely impact our business in various respects; we are subject to risks associated with possible changes in our relationships with third parties with which we do business, as well as the performance of such third parties; we rely extensively on computer systems to process transactions, summarize results and manage our business, and failure to adequately maintain our systems and disruptions in our systems could harm our business and adversely affect our results of operations; we could be subject to additional tax liabilities; a few of our stockholders own approximately 28.1% of our voting stock as of August 31, 2014,which may make it difficult to complete some corporate transactions without their support and may impede a change in control; our inability to develop and retain existing key personnel or to attract highly qualified employees could adversely impact our business, financial condition and results of operations; we are subject to volatility in foreign currency exchange rates; we face the risk of exposure to product liability claims, a product recall and adverse publicity; if we do not maintain the privacy and security of confidential information, we could damage our reputation, incur substantial additional costs and become subject to litigation; we are subject to payment related risks; changes in accounting standards and assumptions, estimates and judgments by management related to complex accounting matters could significantly affect our financial condition and results of operations; we face increased public company compliance risks and compliance risks related to our international operations; we face increased compliance risks associated with compliance with Section 404 of the Sarbanes-Oxley Act of 2002; if remediation costs or hazardous substance contamination levels at certain properties for which we maintain financial responsibility exceed management's current expectations, our financial condition and results of operations could be adversely impacted. In addition to the risks described above, these statements are also subject to 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 filed for the fiscal year ended August 31, 2013 filed on October 30, 2013 pursuant to the Securities Exchange Act of 1934. 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.

   
   
PRICESMART, INC.  
CONSOLIDATED STATEMENTS OF INCOME  
(amounts in thousands, except per share data)  
   
   
    Three Months Ended     Twelve Months Ended  
    August 31,     August 31,  
    2014     2013     2014     2013  
Revenues:                                
Net warehouse club sales   $ 599,568     $ 567,997     $ 2,444,314     $ 2,239,266  
Export sales     12,217       7,439       31,279       23,059  
Membership income     9,762       9,047       38,063       33,820  
Other income     1,008       911       3,911       3,667  
Total revenues     622,555       585,394       2,517,567       2,299,812  
Operating expenses:                                
Cost of goods sold:                                
Net warehouse club     508,310       482,236       2,083,933       1,907,632  
Export     11,621       7,068       29,731       21,796  
Selling, general and administrative:                                
Warehouse club operations     53,884       50,664       212,476       194,140  
General and administrative     12,879       12,334       49,944       46,784  
Pre-opening expenses     1,392       116       3,331       1,525  
Loss/(gain) on disposal of assets     699       536       1,445       889  
Total operating expenses     588,785       552,954       2,380,860       2,172,766  
Operating income     33,770       32,440       136,707       127,046  
Other income (expense):                                
Interest income     277       257       853       1,335  
Interest expense     (1,328 )     (1,265 )     (4,295 )     (4,216 )
Other income (expense), net     (528 )     97       984       (954 )
Total other income (expense)     (1,579 )     (911 )     (2,458 )     (3,835 )
Income from continuing operations before provision for income taxes and loss of unconsolidated affiliates     32,191       31,529       134,249       123,211  
Provision for income taxes     (10,337 )     (10,688 )     (41,372 )     (38,942 )
Income (loss) of unconsolidated affiliates     2       (2 )     9       (4 )
Income from continuing operations     21,856       20,839       92,886       84,265  
Net income   $ 21,856     $ 20,839     $ 92,886     $ 84,265  
Net income per share:                                
Basic net income per share from continuing operations   $ 0.73     $ 0.69     $ 3.07     $ 2.78  
Basic net income per share from discontinued operations, net of tax     --       --       --       --  
Basic net income per share   $ 0.73     $ 0.69     $ 3.07     $ 2.78  
Diluted net income per share from continuing operations   $ 0.73     $ 0.69     $ 3.07     $ 2.78  
Diluted net income per share from discontinued operations, net of tax   $ --     $ --     $ --     $ --  
Diluted net income per share   $ 0.73     $ 0.69     $ 3.07     $ 2.78  
Shares used in per share computations:                                
Basic     29,788       29,687       29,747       29,647  
Diluted     29,796       29,697       29,757       29,657  
Dividends per share   $ --     $ --     $ 0.70     $ 0.60  
                                 
 
 
 PRICESMART, INC.      
 CONSOLIDATED BALANCE SHEETS      
 (amounts in thousands, except share data)   
 
       
    August 31,  
    2014     2013  
ASSETS                
Current Assets:                
Cash and cash equivalents   $ 137,098     $ 121,874  
Short-term restricted cash     2,353       5,984  
Receivables, net of allowance for doubtful accounts of $0 and $0 as of August 31, 2014 and August 31, 2013, respectively     7,910       3,130  
Merchandise inventories     226,383       217,413  
Deferred tax assets - current, net     6,177       6,290  
Prepaid expenses and other current assets (includes $495 and $0 as of August 31, 2014 and August 31, 2013, respectively, for the fair value of derivative instruments)     22,570       20,890  
Total current assets     402,491       375,581  
Long-term restricted cash     27,013       34,775  
Property and equipment, net     426,325       338,478  
Goodwill     36,108       36,364  
Deferred tax assets - long term     11,825       12,871  
Other non-current assets (includes $1,095 and $1,505 as of August 31, 2014 and August 31, 2013, respectively, for the fair value of derivative instruments)     27,593       19,866  
Investment in unconsolidated affiliates     8,863       8,104  
Total Assets   $ 940,218     $ 826,039  
LIABILITIES AND EQUITY                
Current Liabilities:                
Accounts payable     225,761       199,425  
Accrued salaries and benefits     17,799       17,862  
Deferred membership income     17,932       16,528  
Income taxes payable     7,664       8,059  
Other accrued expenses     21,030       20,136  
Long-term debt, current portion     11,848       12,757  
Deferred tax liability - current     157       111  
Total current liabilities     302,191       274,878  
Deferred tax liability - long-term     2,290       2,622  
Long-term portion of deferred rent     5,591       4,440  
Long-term income taxes payable, net of current portion     1,918       2,184  
Long-term debt, net of current portion     79,591       60,263  
Other long-term liabilities (includes $0 and $14 for the fair value of derivative instruments and $372 and $589 for the defined benefit plan as of August 31, 2014 and August 31, 2013, respectively)     372       603  
Total liabilities     391,953       344,990  
Equity:                
Common stock, $0.0001 par value, 45,000,000 shares authorized; 30,950,701 and 30,924,392 shares issued and 30,209,917 and 30,234,506 shares outstanding (net of treasury shares) as of August 31, 2014 and August 31, 2013, respectively     3       3  
Additional paid-in capital     397,150       390,581  
Tax benefit from stock-based compensation     9,505       8,016  
Accumulated other comprehensive loss     (49,286 )     (41,475 )
Retained earnings     215,613       143,871  
Less: treasury stock at cost; 740,784 and 689,886 shares as of August 31, 2014 and August 31, 2013, respectively     (24,720 )     (19,947 )
Total equity     548,265       481,049  
Total Liabilities and Equity   $ 940,218     $ 826,039  
                 

Contact Information

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