Business
PRICESMART ANNOUNCES FISCAL 2023 FIRST QUARTER OPERATING RESULTS
NET MERCHANDISE SALES GREW 8.6%COMPARABLE NET MERCHANDISE SALES INCREASED 5.0%MEMBERSHIP RENEWAL RATE OF 87.9%EPS GREW 7.1% TO RECORD $1.05 SAN DIEGO, Jan. 9,
About this update from Pricesmart, Inc.
NET MERCHANDISE SALES GREW 8.6% COMPARABLE NET MERCHANDISE SALES INCREASED 5.0% MEMBERSHIP RENEWAL RATE OF 87.9% EPS GREW 7.1% TO RECORD $1.05 SAN DIEGO , Jan. 9, 2023 /PRNewswire/ -- PriceSmart, Inc. (NASDAQ: PSMT), operator of 50 warehouse clubs in 12 countries and one U.S. territory, today announced results for the first quarter of fiscal year 2023, which ended on November 30, 2022 . Comments from Robert E. Price , Chairman of the Board: "We had another solid first quarter with total revenues and net merchandise sales exceeding $1.0 billion . Net merchandise sales increased by 8.6% after a negative 2.3% currency impact and comparable net merchandise sales increased by 5.0% after taking into account a negative 2.1% currency impact. "Membership accounts grew 3.9% versus the prior year and ended the quarter at 1.76 million. We continued with strong 12-month renewal rates of 87.9% and our membership income was a record $15.9 million , an increase of 7.5% over the same period last year. We believe that these renewal rates demonstrate that our Members remain pleased with the value they are receiving and appreciate the PriceSmart shopping experience. "The team did a great job of being proactive about selling through overstocked categories and getting back to our core business that has a more standard inventory balance and customary margin structures." First Quarter Financial Results Total revenues for the first quarter of fiscal year 2023 increased 8.1% to $1.05 billion compared to $975.4 million in the comparable period of the prior year. For the first quarter of fiscal year 2023, net merchandise sales increased 8.6% to $1.03 billion from $944.0 million in the first quarter of fiscal year 2022. Foreign currency exchange rate fluctuations impacted net merchandise sales negatively by $21.2 million , or 2.3%, versus the same period in the prior year. The Company had 50 warehouse clubs in operation as of November 30, 2022 , compared to 49 warehouse clubs in operation as of November 30, 2021 . Comparable net merchandise sales (that is, sales in the 47 warehouse clubs that have been open for greater than 13 ½ calendar months) for the 13 weeks ended December 4, 2022 increased 5.0% compared to the prior year. Foreign currency exchange rate fluctuations impacted comparable net merchandise sales negatively by $19.5 million , or 2.1%, versus the same period in the prior year. The Company recorded operating income during the fiscal first quarter of $55.5 million compared to operating income of $46.0 million in the prior year period. Net income attributable to PriceSmart grew 7.9% to $32.9 million , or $1.05 per diluted share, in the first quarter of fiscal year 2023 as compared to $30.5 million , or $0.98 per diluted share, in the first quarter of fiscal year 2022. Conference Call Information PriceSmart management will host a conference call at 12:00 p.m. Eastern time ( 9:00 a.m. Pacific time ) on Tuesday, January 10, 2023 , to discuss the financial results. Individuals interested in participating in the conference call may do so by dialing toll free (855) 209-8211 or (412) 317-5214 for international callers and asking to join the PriceSmart earnings call. A digital replay will be available through January 17, 2023 , shortly following the conclusion of the call by dialing (877) 344-7529 for domestic callers, or (412) 317-0088 for international callers, and entering replay passcode 6032359. 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 and services at low prices to PriceSmart Members. PriceSmart operates 50 warehouse clubs in 12 countries and one U.S. territory (nine in Colombia ; eight in Costa Rica ; seven in Panama ; five in the Dominican Republic and Guatemala , four in Trinidad ; three in Honduras ; two each in El Salvador , Nicaragua , and Jamaica ; and one each in Aruba , Barbados and the United States Virgin Islands ). In addition, the Company plans to open a warehouse club in San Miguel , El Salvador in the spring of 2023 and a warehouse club in Medellín, Colombia in the summer of 2023. Once these two new clubs are open, the Company will operate 52 warehouse clubs. This press release may contain forward-looking statements concerning PriceSmart, Inc.'s (" PriceSmart ", the "Company" or "we") anticipated future revenues and earnings, adequacy of future cash flows, omni-channel initiatives, proposed warehouse club openings, the Company's performance relative to competitors 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," "intend," and like expressions, and the negative thereof. These statements are subject to risks and uncertainties that could cause actual results to differ materially including, but not limited to: various political, economic and compliance risks associated with our international operations, adverse changes in economic conditions in our markets, natural disasters, volatility in currency exchange rates and illiquidity of certain local currencies in our markets, competition, consumer and small business spending patterns, political instability, increased costs associated with the integration of online commerce with our traditional business, whether the Company can successfully execute strategic initiatives, our reliance on third party service providers, including those who support transaction and payment processing, data security and other technology services, cybersecurity breaches that could cause disruptions in our systems or jeopardize the security of Member or business information, cost increases from product and service providers, interruption of supply chains, novel coronavirus (COVID-19) related factors and challenges, exposure to product liability claims and product recalls, recoverability of moneys owed to PriceSmart from governments, risks associated with our leadership transition, and other important factors discussed in the Risk Factors section of the Company's most recent Annual Report on Form 10-K, and other factors discussed from time to time in other filings with the SEC , which are accessible on the SEC's website at www.sec.gov , including Quarterly Reports on Form 10-Q and Current Reports on Form 8- K. Forward -looking statements speak only as of the date that they are made, and the Company does not undertake to update them, except as required by law. For further information, please contact Michael L. McCleary , EVP, Chief Financial Officer and Principal Accounting Officer (858) 404-8826 or send an email to [email protected] . PRICESMART, INC. CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA) Three Months Ended November 30 , November 30 , 2022 2021 Revenues: Net merchandise sales $ 1,025,463 $ 944,043 Export sales 10,458 10,534 Membership income 15,895 14,791 Other revenue and income 2,990 5,988 Total revenues 1,054,806 975,356 Operating expenses: Cost of goods sold: Net merchandise sales 859,068 793,193 Export sales 9,989 10,067 Non-merchandise — 1,809 Selling, general and administrative: Warehouse club and other operations 96,892 91,196 General and administrative 33,172 31,693 Pre-opening expenses — 970 Loss on disposal of assets 158 411 Total operating expenses 999,279 929,339 Operating income 55,527 46,017 Other income (expense): Interest income 1,157 518 Interest expense (2,749) (1,590) Other income (expense), net (4,566) 1,409 Total other income (expense) (6,158) 337 Income before provision for income taxes and loss of unconsolidated affiliates 49,369 46,354 Provision for income taxes (16,426) (15,814) Loss of unconsolidated affiliates (38) (10) Net income 32,905 30,530 Less: net income attributable to noncontrolling interest — (19) Net income attributable to PriceSmart, Inc. $ 32,905 $ 30,511 Net income attributable to PriceSmart, Inc. per share available for distribution : Basic $ 1.05 $ 0.98 Diluted $ 1.05 $ 0.98 Shares used in per share computations: Basic 30,713 30,551 Diluted 30,719 30,603 PRICESMART, INC. CONSOLIDATED BALANCE SHEETS (AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA) November 30 , 2022 August 31 , (Unaudited) 2022 ASSETS Current Assets: Cash and cash equivalents $ 267,944 $ 237,710 Short-term restricted cash 2,873 3,013 Short-term investments 8,920 11,160 Receivables, net of allowance for doubtful accounts of $119 as of November 30 , 2022 and $103 as of August 31, 2022 , respectively 18,757 13,391 Merchandise inventories 510,060 464,411 Prepaid expenses and other current assets (includes $194 and $2,761 as of November 30, 2022 and August 31, 2022 , respectively, for the fair value of derivative instruments) 44,731 43,894 Total current assets 853,285 773,579 Long-term restricted cash 10,871 10,650 Property and equipment, net 756,663 757,241 Operating lease right-of-use assets, net 108,762 111,810 Goodwill 43,173 43,303 Deferred tax assets 27,427 28,355 Other non-current assets (includes $15,986 and $11,884 as of November 30, 2022 and August 31, 2022 , respectively, for the fair value of derivative instruments) 77,242 72,928 Investment in unconsolidated affiliates 10,497 10,534 Total Assets $ 1,887,920 $ 1,808,400 LIABILITIES AND EQUITY Current Liabilities: Short-term borrowings $ 11,050 $ 10,608 Accounts payable 446,572 408,407 Accrued salaries and benefits 33,693 44,097 Deferred income 29,609 29,228 Income taxes payable 9,617 7,243 Other accrued expenses and other current liabilities 40,388 38,667 Operating lease liabilities, current portion 7,349 7,491 Long-term debt, current portion 33,280 33,715 Total current liabilities 611,558 579,456 Deferred tax liability 1,877 2,165 Long-term income taxes payable, net of current portion 5,036 5,215 Long-term operating lease liabilities 115,808 118,496 Long-term debt, net of current portion 118,505 103,556 Other long-term liabilities (includes $8,772 and $8,440 for post-employment plans as of November 30, 2022 and August 31, 2022 , respectively) 8,773 8,439 Total Liabilities 861,557 817,327 PRICESMART, INC. CONSOLIDATED BALANCE SHEETS (AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA) Stockholders' Equity: Common stock $0.0001 par value, 45,000,000 shares authorized; 31,857,969 and 31,697,590 shares issued and 31,050,917 and 30,904,826 shares outstanding (net of treasury shares) as of November 30, 2022 and August 31, 2022 , respectively 3 3 Additional paid-in capital 485,096 481,406 Accumulated other comprehensive loss (196,137) (195,586) Retained earnings 769,799 736,894 Less: treasury stock at cost, 807,052 shares as of November 30, 2022 and 792,764 shares as of August 31, 2022 (32,398) (31,644) Total Stockholders' Equity 1,026,363 991,073 Total Liabilities and Equity $ 1,887,920 $ 1,808,400 View original content to download multimedia: https://www.prnewswire.com/news-releases/pricesmart-announces-fiscal-2023-first-quarter-operating-results-301716881.html SOURCE PriceSmart, Inc.