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Costco sees sales jump in June

Costco sees sales jump in June

U.S. same-store results climb by double digits

Costco Wholesale Corp. continued its streak of robust revenue gains in June, including its third straight month of double-digit increases in U.S. comparable-store sales.

For the five weeks ended July 8, Costco totaled sales of $13.55 billion, up 11.7% from $12.13 billion a year earlier.

June comp-store sales rose 9.7% overall and 10.8% in the United States, compared with year-over-year growth of 6% in Canada and 7.3% in other international markets, Issaquah, Wash.-based warehouse club chain said. E-commerce sales surged 27.9% companywide.

Excluding the impact of fuel price inflation and foreign exchange, Costco’s same-store sales were up 6.9% in June, including a 7.7% increase in the U.S. Growth came in at 3.4% for Canada and 6.9% for international, excluding gas prices and currency exchange, during the month. The gain for e-commerce stayed about the same, with those sales rising 27.7%.

Zacks Equity Research noted that Costco’s strong same-store performance in June came on the heels of an 11.7% uptick in May. “This shows that the company continues to be one of the dominant retail wholesalers based on the breadth and quality of merchandise offered,” Zacks said in a report Thursday on Costco’s June sales results.

During June, food and sundries tallied comp-store sales (excluding foreign exchange) in the mid-single digits, led by tobacco, liquor and frozen foods, David Sherwood, assistant vice president of finance and investor relations at Costco, said in a conference call late Wednesday.

“Fresh foods were up by mid-single digits, and the better-performing departments were bakery and service deli,” he said.

Club traffic and basket size also edged up in June, according to Sherwood. On a comparable basis, Costco’s store traffic during the month increased 4.4% worldwide and 4.6% in the U.S.

“The average transaction was up 5% for the month, which includes the combined impacts from foreign exchange and gasoline price inflation,” he said.

As shown by the e-commerce sales jump in June, Costco is making big strides in growing its digital retail business, according to Zacks.

“This signals that its efforts to drive online sales bode well,” the Zacks research note said. “With the wave of digital transformation hitting the sector, retailers are fast adopting the omnichannel mantra to provide a seamless shopping experience, whether online or in stores. Costco, which shares space with Walmart, Amazon and Target, is no exception to this trend.”

For the year-to-date period through July 8, Costco totaled sales of $116.81 billion, up 12% from $104.28 billion a year ago. E-commerce revenue for the 44 weeks rose 34.8%. Same-store sales for the year to date gained 9.6% overall (6.7% excluding fuel and forex) and 9.1% (7.2% excluding fuel and forex) in the U.S.

As of July 8, Costco had 752 wholesale clubs, including 522 in the United States and Puerto Rico, 98 in Canada, 38 in Mexico, 28 in the United Kingdom, 26 in Japan, 14 in Korea, 13 in Taiwan, nine in Australia, two in Spain, one in Iceland and one in France. The retailer also operates e-commerce websites in the U.S., Canada, the U.K., Mexico, Korea and Taiwan.

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