PriceSmart gains 4% on Q3 earnings and revenue beat

SAN DIEGO – PriceSmart Inc. (NASDAQ: NASDAQ:), the operator of membership warehouse clubs in Latin America and the Caribbean, reported a robust fiscal third quarter with earnings and revenue surpassing analyst estimates.

The company’s stock surged 4.7% in response to the positive financial results.

For the quarter ending May 31, 2024, PriceSmart announced a significant 11.6% increase in net merchandise sales, reaching $1.19 billion, up from $1.07 billion in the same quarter last year. Total revenues climbed 12.1% to $1.23 billion compared to $1.10 billion in the prior-year period, exceeding the consensus estimate of $1.2 billion. The company’s earnings per diluted share (EPS) for the quarter was $1.08, outperforming the analyst estimate of $1.01.

Comparable net merchandise sales, which reflect the performance of stores open for more than 13 and a half months, rose by 7.8%. This growth was partially aided by favorable foreign currency exchange rate fluctuations, which positively impacted net merchandise sales by 2.5% compared to the previous year.

The company’s operating income for the third quarter stood at $49.9 million, an increase from $43.1 million in the same period last year. Net income also saw a rise of 9.9% to $32.5 million, or $1.08 per diluted share, compared to the third quarter of the prior fiscal year.

Adjusted net income remained consistent at $32.5 million, while adjusted EBITDA for the quarter improved to $71.0 million from $63.9 million in the comparable period last year.

The company’s expansion strategy is also on track, with plans to open a new warehouse club in Cartago, Costa Rica, in the spring of 2025, which will mark the company’s 55th location.

In light of the earnings release, Michael L. McCleary, EVP, Chief Financial Officer and Principal Accounting Officer, stated, “Our strong performance this quarter reflects the successful execution of our strategic initiatives and our commitment to delivering value to our members.”

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