Costco Wholesale Corporation (COST)
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Monthly Sales Update May 2021

Jun 3, 2021

David Sherwood
AVP of Finance and Investor Relations, Costco Wholesale

Hello, thank you for calling Costco Wholesale Corporation. I'm David Sherwood, AVP of Finance and Investor Relations, and I will review our sales results for the four-week retail month of May, which started on Monday, May 3rd, and ended on Sunday, May 30th. This period is compared to the four weeks that began on Monday, May 4th, and ended on Sunday, May 31st, 2020. This call will include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements involve risks and uncertainties that may cause actual events, results, and/or performance to differ materially from those indicated by such statements. The risks and uncertainties include, but are not limited to, those outlined in today's call and sales release, as well as other risks identified from time to time in the company's public statements and reports filed with the SEC.

Forward-looking statements speak only as of the date they are made, and the company does not undertake to update them except as required by law. As reported in our release today, net sales for May came in at $15.59 billion, an increase of 24.2% from $12.55 billion last year. Comparable sales were as follows. On a reported basis, in the U.S., the four weeks is at 21.9%, 39 weeks, 15.3%. In Canada, the four weeks was at 28.8%, 39 weeks, 20.7%. Other international for four weeks, 21.5%, 39 weeks, 20.9%. Total company, the four weeks was at 22.8%, and the 39 weeks is at 16.8%. E-commerce for the four weeks is at 12.1%, 39 weeks, 58.9%. Comparable sales, excluding the impacts on changes in gasoline prices and foreign exchange were as follows. In the U.S., the four weeks was at 16.7%, 39 weeks, 15.3%.

In Canada, the four weeks was at 8.9%, 39 weeks, 14.1%. Other international, four weeks, 9.6%, 39 weeks, 15.6%. Total company, the four weeks was at 14.7% and the 39 weeks at 15.2%. E-commerce, four weeks, 8.7% and 39 weeks, 57.1%. Our comp traffic or frequency for May was up 18.8% worldwide and up 18.3% in the U.S. This year's four-week May retail month had one additional shopping day versus last year due to the calendar shift of Memorial Day. This positively impacted total and comparable sales as well as traffic by approximately 2%-2.5%. Foreign currency year-over-year relative to the US dollar impacted May comp sales as follows. Canada, positively by approximately 17%, other international, positively by approximately 10.5%, and total company, positively by approximately 3.7%. Gasoline price inflation positively impacted total reported comp sales by approximately 4.4%.

Their average selling price was 53% higher year-over-year at $3.13 per gallon this year compared to $2.05 last year. Comp Gasoline volume was also up significantly relative to last year. Worldwide, the average transaction for May was up 3.4%, which included the positive impacts from Gasoline inflation and FX. In terms of regional merchandising categories, the general highlights were as follows. U.S. regions with the strongest sales increases were Texas, Southeast, and Midwest. Other international and local currencies, we saw the strongest results in Spain, Mexico, and Korea. Moving into merchandise highlights, the following comparable sales results by category for the month exclude the positive impact of foreign exchange. Food and sundries were positive mid to high single digits. Candy, sundries, and liquor were the strongest departments. Fresh foods were up low double digits. Better-performing departments included service deli and bakery.

Non-foods were positive in the mid to high teens. Better-performing departments included home furnishings, jewelry, and apparel. Ancillary business sales were up more than 80%. Gas, hearing aids, Optical, and Food Court were all significant drivers. Looking ahead, the June reporting period will include the five weeks beginning May 31st and ending July 4th compared to the five weeks beginning June 1st and ending July 5th, 2020. June will have one fewer shopping day versus last year due to the calendar shift of Memorial Day. June sales will be announced on Thursday, July 8th at 1:15 P.M. Pacific Time. If you have any questions regarding our May sales results or any other Investor Relations questions, please call Bob Nelson at 425-313-8255, Josh Dahmen at 425-313-8254, or myself, David Sherwood, at 425-313-8239. This recording will be available until 5:00 P.M. Pacific Time, Thursday, June 10th.

Thanks for calling, and have a great day. This recording will be available until 5:00 PM Pacific Time, Thursday, June 10th. Thanks for calling. Have a great day.