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Costco profit up 12 percent

Eight-month-old Hannah Michalek looks on as her mother's purchases are tallied at a Costco store Monday in Seattle. (Associated Press / The Spokesman-Review)
Associated Press
Eight-month-old Hannah Michalek looks on as her mother's purchases are tallied at a Costco store Monday in Seattle. (Associated Press / The Spokesman-Review)

SEATTLE — Costco Wholesale Corp. said Thursday that its fiscal first-quarter profit grew 12 percent, helped by growth at its warehouse clubs open at least one year.

For the 12 weeks ended Nov. 20, the nation’s largest wholesale-club operator reported quarterly earnings of $215.8 million, or 45 cents per share, up from $193.2 million, or 40 cents per share, a year earlier.

The latest quarter included a charge of about 1 cent per share from damage due to Hurricane Wilma in Florida, while the prior year’s results included a 1 cent per share charge from four hurricanes in the state.

The Issaquah-based company said net sales for the quarter increased 12 percent to $12.66 billion from $11.34 billion last year, with sales up 9 percent at warehouses open at least one year.

Total revenue, which includes membership fees, rose to $12.93 billion from $11.58 billion in the year-ago period.

In a conference call with analysts, Costco Chief Financial Officer Richard Galanti said the retailer was particularly pleased with consumer electronics sales.

“The business is on fire,” he said, adding that sales via its Web site are also “going great guns.”

Costco’s profit met analysts’ estimate of 45 cents per share, and was above expectations for $12.82 billion in revenue, according to a Thomson Financial poll. The company had not provided specific guidance, but said in October that estimates were at the high end.

In the conference call, Galanti would not specify whether the company might increase its $45 annual membership fee in response to competitors’ moves. Sam’s Club, a unit of Wal-Mart Stores Inc., will raise its fees by $5 to $40 for consumers and $35 for businesses, effective Jan. 1.