Le Lézard
Classified in: Business, Covid-19 virus
Subject: ERN

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, 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

 

SOURCE PriceSmart, Inc.


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