Pricesmart, Inc. · NASDAQ:PSMT
Pricesmart — Q1 2024 Earnings Presentation
31 slides from Pricesmart's earnings presentation, Jan 10, 2024
Slide 1: PriceSmart, Inc. Overview Presentation
PriceSmart, Inc. Overview Presentation Issued January 2024 NASDAQ: PSMT 1
Slide 2: Forward Looking Statements and Non-GAAP Financial Measures
Forward Looking Statements: This presentation may contain forward-looking statements concerning the Company's anticipated future revenues and earnings, adequacy of future cash flows, omni-channel initiatives, proposed warehouse club openings, the Company's performance relative to competitors, the ou
Slide 3: Business Overview
PriceSmart BUSINESS OVERVIEW
Slide 4: Our Origins
OUR ORIGINS FOUNDED FedMart 1954 FOUNDED 1993 Founded in San Diego, California in 1954 Founders: Sol Price and local investors Price Club and Costco Merger in 1993 Founding Principles: Duty to our Customers • Merger created the second largest • Customers come first • Sell only quality merchandise me
Slide 5: Our History
OUR HISTORY 1996 1997 1999 2008 2011 2012 2013 2017 2018 2019 2020 2021 2022 2023 2024 First Location PriceSmart Expansion PriceSmart PriceSmart PriceSmart 1 Million PriceSmart Launch of Launch of • Launch of • Addition of • Opening of • Opening of 51st • Opening of in Panama Listed on into $1 Billi
Slide 6: Our Culture
6 OUR CULTURE Values Integrity Always do the right thing. Respect Treat employees, suppliers and Members the way you want to be treated. Accountability Deliver on commitments you make to your team and the company. Passion Operate great warehouse clubs while putting Members first. Community Support a
Slide 7: Our Mission
OUR MISSION PriceSmart exists to improve the lives and businesses of our Members, our employees and our communities through the responsible delivery of the best quality goods and services at the lowest possible prices. Our mission is to serve as a model company, which operates profitably and provide
Slide 8: Our Six Rights Value Proposition
OUR SIX RIGHTS VALUE PROPOSITION Squeeze Out Inefficiencies The Right Limited SKU Selection Merchandise The Right Efficient Distribution with Regional and Domestic Distribution Centers Time Low Margins to Pass Savings onto Members Leverage Volume Buying Reinvest in Membership Value The Right Commitmen
Slide 9: Our Club Locations
OUR CLUB LOCATIONS PriceSmart operates 53 warehouse clubs GUATEMALA HONDURAS in emerging and developing markets that Miraflores Pradera Fraijanes Tegucigalpa San Pedro Sula reach 12 countries and one U.S. territory. San Cristobal El Sauce Guatemala City Escuintla USVI NICARAGUA Managua St. Thomas Ma
Slide 10: Our Distribution Network
OUR DISTRIBUTION NETWORK DOMINICAN REPUBLIC Florida Produce Distribution Center During the first three months of fiscal Domestic Distribution Center Global Distribution Center year 2024: GUATEMALA Produce Distribution Center ▪ 79.5% of net merchandise sales were in currencies other than the U.S. dol
Slide 11: Our Growth Plan
OUR GROWTH PLAN • Invest in Remodeling Current PriceSmart Clubs, Adding New PriceSmart Locations and Opening More Distribution Centers. • Increase Membership Value for both Retail and Business Members, which drives Membership Income and Merchandise Sales. • Increase Sales via PriceSmart.com and Enha
Slide 12: Recent Club Openings
RECENT CLUB OPENINGS December 2020 October 2021 November 2021 April 2022 Usaquén Guatemala City Floridablanca Portmore 8th Club in Colombia 5th Club Guatemala 9th Club Colombia 2nd Club Jamaica May 2023 September 2023 November 2023 San Miguel El Poblado (Medellín) Escuintla 3rd Club El Salvador 10th
Slide 13: Real Estate Growth (Expected Openings)
REAL ESTATE GROWTH (Expected Openings) February 2024 Santa Ana 4th Club El Salvador 13
Slide 14: Enhanced Membership Value
ENHANCED MEMBERSHIP VALUE Continued growing of We partner with the PriceSmart foundation to seek to Member Wellness Offerings: Our popular Member’s Selection Continued focus on Philanthropy support and strengthen our communities by investing in Pharmacy, Optical and Audiology. Product Line-up keeps
Slide 15: Omni-Channel Platform
OMNI-CHANNEL PLATFORM Onboard/Renew Membership online Growing multi-channel personalized communication and Order online, Member interaction pick up at the Club! Exclusive online merchandise! PriceSmart App (easy access to product offers, Home digital membership card, delivery! order tracking) 15
Slide 16: Environmental and Social
ENVIRONMENTAL AND SOCIAL Our Environmental Initiatives Sustainable facilities focused on reducing and minimizing PriceSmart’s environmental impact ✓ Solar Panels ✓ Lighting Systems ✓ Hot Water Reclamation Systems ✓ Waste Management ✓ Sustainable Fisheries ✓ Food Bank Partnerships ✓ Recycling Centers
Slide 17: Workplace Rankings
WORKPLACE RANKINGS We are ranked: • PriceSmart in the Top 100 Global Most Loved Workplaces for 2023 by Newsweek's Magazine • 2nd Best Workplace in Colombia within the Retail Sector by job portal Computrabajo 17
Slide 18: Financials
PriceSmart FINANCIALS
Slide 19: Q1 FY24 Financial Highlights
Q1 FY24 FINANCIAL HIGHLIGHTS $38.0 Million 10.7% 11.7% Net Income $58.2 Million Membership Income and Net Merchandise Sales Adjusted Net Income* Growth Operating Growth Income $17.7 Million $77.8 Million $1.14 Billion Membership Income Adjusted EBITDA* Net Merchandise Sales $1.24 10.6% 5.0% Earnings
Slide 20: Strong Sales
STRONG SALES Comparable Club Sales Net Merchandise Sales ($ in Millions) Changes in U.S. dollar Comparable Net Merchandise Sales CAGR 8.4% 15.0% 10.4% 8.0% $4,301 $4,410 5.8% 7.1% $3,945 10.0% $3,192 $3,465 5.0% -1.5% 0.0% -5.0% FY20 FY21 FY22 FY23 TTM 11/30/2023 FY20 FY21 FY22 FY23 3 months YTD FY2
Slide 21: Consistent and Reliable Membership Income
CONSISTENT AND RELIABLE MEMBERSHIP INCOME Membership Renewal Rate & Membership Accounts Membership Fee Income 1.76 1.81 1.82 200% 1.56 1.67 ($ in millions) & Average Fee 180% 160% 140% 120% CAGR 5.4% 90% 89% 87% 87% 100% 81% 80% 60% $66 $68 40% $61 $55 $56 20% Membership Accounts (in millions) TTM R
Slide 22: Investing in Membership Experience
INVESTING IN MEMBERSHIP EXPERIENCE Platinum Members 169,525 160,913 Platinum CAGR 21% 131,316 103,231 77,909 * FY20 FY21 FY22 FY23 3 months YTD FY24 Platinum Penetration 8.9% 9.3% 7.4% 6.2% 5.0% *Our Diamond Members generally pay an annual membership fee of approximately $35 to $40 and our FY20 FY21
Slide 23: Margins and Operating Income
MARGINS AND OPERATING INCOME Total Revenue Margin% and (1) Operating Income % and Total Revenue ($ in billions) Total Revenue ($ in billions) TTM 11/30/202316.1% 17.2% $4.5 TTM 11/30/2023 4.1% $4.5 16.1% FY23 17.2% $4.4 FY23⁽³⁾ 4.2% $4.4 16.4% FY22 16.8% $4.1 FY22 4.1% $4.1 16.7% FY21⁽²⁾ 17.8% $3.6
Slide 24: Earnings per Diluted Share
EARNINGS PER DILUTED SHARE Earnings Per Diluted Share Adjusted Earnings Per Diluted Share** CAGR 11.1%* CAGR 16.8%* 16.1% 16.4% $3.50 $3.18 $3.38 16.7% $4.06 $2.55 $3.18 $3.33 $2.55 $1.24 $1.24 FY20 FY21 FY22 FY23 Q1 FY24 FY20⁽¹⁾ FY21⁽¹⁾ FY22 FY23 Q1 FY24⁽¹⁾ (1) Adjusted Earnings per Diluted Share f
Slide 25: Capital Expenditures
CAPITAL EXPENDITURES Maintenance and Growth CapEx ($ Millions) $73.2 $69.3 $19.7 $13.6 FY23 Q1 FY24 Total Growth CapEx⁽¹⁾ Total Maintenance CapEx⁽²⁾ (1) Total growth expenditures for new clubs, supply chain improvements, and major remodels. (2) Total maintenance expenditures for operational fixtures
Slide 26: Strong Financial Metrics
STRONG FINANCIAL METRICS (Amount in thousands of dollars, YTD Q1 except Number of Warehouse Clubs) FY 2020 FY 2021 FY 2022 FY 2023 FY 2024 Amounts Held by Foreign Subsidiaries 203,598 160,808 203,952 139,050 163,608 Amounts Held Domestically 100,173 54,671 47,421 113,152 23,280(3) Total Cash and Cas
Slide 27: Appendix
APPENDIX PriceSmart
Slide 28: GAAP to Non-GAAP Reconciliations
GAAP to Non-GAAP Reconciliations Adjusted Net Income and Adjusted EBITDA Adjusted Net Income Three Months Ended (Amounts in thousands, except Earnings Per Diluted Share) November 30, 2023 November 30, 2022 Net income as reported $ 38,047 $ 32,905 Adjustments: (1) Aeropost-related write-offs - 2,125
Slide 29: GAAP to Non-GAAP Reconciliations (Continued)
GAAP to Non-GAAP Reconciliations (Continued) Adjusted Earnings Per Diluted Share Adjusted Net Income per Diluted Share Years Ended Three Months Ended August 31, 2020 August 31, 2021 August 31, 2022 August 31, 2023 November 30, 2023 Net income attributable to PriceSmart per diluted share $ 2.55 $ 3.1
Slide 30: GAAP to Non-GAAP Reconciliations (Continued)
GAAP to Non-GAAP Reconciliations (Continued) Constant Currency Reconciliations Net Merchandise Sales and Net Merchandise Sales - Constant Currency Reconciliation Net Merchandise Sales - Impact of Foreign Currency Net Merchandise Sales (Amounts in millions) Constant Currency Exchange FY 20 $ 3,192 $
Slide 31: Investor Relations
INVESTOR RELATIONS Investor Relations Contact Michael McCleary Executive Vice President and Chief Financial Officer ir@pricesmart.com 858-404-8826 31 24