Pricesmart Inc (PSMT) Reports 10% Growth in Net Merchandise Sales in Q4 2023
Pricesmart Inc (NASDAQ:PSMT) reported a 10% increase in net merchandise sales for Q4 2023.
The company's adjusted earnings per diluted share were $0.65, net of $0.30 tax settlement charges.
Operating income for the fiscal year 2023 was $184.5 million, compared to $167.1 million in the prior year period.
Net income attributable to Pricesmart increased 4.5% to $109.2 million in fiscal year 2023.
Pricesmart Inc (NASDAQ:PSMT), a leading operator of 52 warehouse clubs in 12 countries and one U.S. territory, released its earnings for the fiscal fourth quarter of 2023 on October 30, 2023. The company reported a 10% increase in net merchandise sales, reaching $1.09 billion from $989.9 million in the fourth quarter of fiscal year 2022. The company's adjusted earnings per diluted share stood at $0.65, net of $0.30 tax settlement charges.
Financial Performance
Pricesmart's total revenues for the fourth quarter of fiscal year 2023 increased 9.5% to $1.12 billion compared to $1.02 billion in the comparable period of the prior year. The company recorded operating income during the fiscal fourth quarter of $32.1 million compared to operating income of $39.0 million in the prior year period. The decrease is primarily due to a $9.2 million charge to settle minimum tax litigation in one of the markets and a $5.7 million asset impairment charge and related closure costs.
Net income attributable to Pricesmart decreased to $15.4 million, or $0.49 per diluted share, in the fourth quarter of fiscal year 2023 compared to $23.3 million, or $0.75 per diluted share, in the fourth quarter of fiscal year 2022. This decrease was primarily due to a $0.30 per diluted share negative impact related to the settlement of minimum tax litigation and an $0.18 per diluted share negative impact for an asset impairment charge and related closure costs.
Year-to-Date Financial Results
For the twelve months ended August 31, 2023, total revenues increased 8.5% to $4.41 billion compared to $4.07 billion in the prior year. Net merchandise sales increased 9.0% to $4.30 billion from $3.94 billion in the comparable prior year period. The company recorded operating income during fiscal year 2023 of $184.5 million compared to operating income of $167.1 million in the prior year period.
Net income attributable to Pricesmart increased 4.5% to $109.2 million, or $3.50 per diluted share, in fiscal year 2023 compared to $104.5 million, or $3.38 per diluted share, in fiscal year 2022. This increase includes a $0.30 per diluted share negative impact related to the settlement of minimum tax litigation and an $0.18 per diluted share negative impact for an asset impairment charge and related closure costs.
Future Outlook
Pricesmart plans to continue its growth trajectory with the opening of a warehouse club in Escuintla, Guatemala on November 30, 2023, and a warehouse club in Santa Ana, El Salvador in early 2024. Once these two new clubs are open, the company will operate 54 warehouse clubs.
Despite the challenges faced in the fiscal year 2023, Pricesmart Inc (NASDAQ:PSMT) has demonstrated resilience and adaptability, delivering solid financial results. The company's strategic initiatives and commitment to providing high-quality merchandise and services at low prices continue to drive its growth and profitability.
Explore the complete 8-K earnings release (here) from Pricesmart Inc for further details.
This article first appeared on GuruFocus.
