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Costco Q4 profit rises on strength overseas

ISSAQUAH, Wash. - Increased revenue from selling memberships and strength overseas helped push Costco Wholesale Corp.'s net income up 16 per cent in the fiscal fourth quarter.

ISSAQUAH, Wash. - Increased revenue from selling memberships and strength overseas helped push Costco Wholesale Corp.'s net income up 16 per cent in the fiscal fourth quarter.

Costco's shares fell 57 cents to US$64.09 in morning trading after revenue that came in shy of analysts' forecasts.

The nation's biggest warehouse club operator has seen the number of customers in its clubs grow as shoppers hunt for deals in the weak economy.

Costco reported Wednesday that it earned $432 million, or 97 cents per share, for the period ended Aug. 29. That's up from $374 million, or 85 cents per share, a year ago.

This beat analysts' estimates of 95 cents per share, according to Thomson Reuters.

Revenue rose eight per cent to $24.13 billion, helped by more money from membership fees. That missed Wall Street's projected $24.23 billion.

Revenue from sales at clubs open at least a year climbed six per cent. Excluding the effects of higher gas prices and changes in currency exchange rates, the figure rose four per cent. The figure is a key measurement of a retailer's health because it measures results at existing stores rather than newly opened ones.

For the year, net income increased 19 per cent to $1.3 billion, or $2.92 per share, compared with $1.09 billion, or $2.47 per share, a year earlier.

Annual revenue rose 9.1 per cent to $77.95 billion.

Revenue from sales at clubs open at least a year increased seven per cent for fiscal 2010. Removing higher gas prices and changes in currency exchange rates, the metric rose four per cent.

Costco, based in Issaquah, Wash., runs 573 warehouses, including 417 in the U.S. and Puerto Rico, 79 in Canada, 22 in the U.K., seven in Korea, six in Taiwan, nine in Japan, one in Australia and 32 in Mexico.

 
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