PriceSmart Reports 7.8% Revenue Growth to $1.26 Billion in Q1 Fiscal 2025

PriceSmart, Inc. reported its financial results for the first quarter of fiscal year 2025, ending November 30, 2024, revealing a total revenue of $1.26 billion, a 7.8% increase from $1.17 billion in the same period last year. The company's net merchandise sales also rose by 7.8%, reaching $1.22 billion compared to $1.14 billion in the prior year. Despite the revenue growth, net income slightly decreased to $37.4 million, or $1.21 per diluted share, down from $38.0 million, or $1.24 per diluted share, in the previous year.

The company experienced notable changes in its operational metrics, with membership income increasing by 13.8% to $20.2 million, driven by a rise in membership fees and an expanding member base. PriceSmart ended the quarter with 54 warehouse clubs, up from 53 a year earlier, and reported a 4.8% increase in total membership accounts, reaching approximately 1.91 million. The company also noted a 5.7% increase in comparable net merchandise sales, indicating a positive trend in customer engagement and spending.

Strategically, PriceSmart is focused on enhancing its operational capabilities and expanding its footprint. The company plans to open two new warehouse clubs in Costa Rica and Guatemala in 2025, which will bring the total to 56 locations. Additionally, PriceSmart is investing in technology to improve its online shopping experience and operational efficiencies, which includes the rollout of a new website and mobile application. The company aims to increase membership value through enhanced services, including optical and pharmacy offerings, and by expanding its private label product line.

Operationally, PriceSmart's total gross margin for the quarter was 15.9%, a slight decrease from 16.1% in the previous year, attributed to rising costs and competitive pricing pressures. Selling, general, and administrative expenses increased by 10.1% to $160.8 million, primarily due to investments in technology. The company reported a net loss of $7.3 million in total other expenses, significantly higher than the $2.1 million loss in the same period last year, largely due to increased foreign currency transaction losses.

Looking ahead, PriceSmart remains optimistic about its growth trajectory, emphasizing its commitment to remodeling existing clubs, expanding its locations, and enhancing its digital capabilities. The company is also focused on mitigating risks associated with currency fluctuations and economic conditions in its operating markets. PriceSmart's management believes that these strategic initiatives will position the company for continued growth and improved financial performance in the coming quarters.