Warehouse Clubs Operator PriceSmart Soars on Strong Q2, Rewards Shareholders With Special Dividend

PriceSmart, Inc. PSMT shares are trading higher after it reported second-quarter FY24 results.

Revenue increased 13.1% Y/Y to $1.29 billion, beating the consensus of $1.28 billion. 

Net merchandise sales rose 13.0% Y/Y (+9.0% Y/Y in constant currency) to $1.26 billion, with foreign currency exchange rate fluctuations impacting positively by $44.2 million.

Comparable net merchandise sales for the 50 warehouse clubs, open for over 13 ½ calendar months, rose 8.8% for the 13 weeks ending March 3, 2024.

Adjusted EBITDA stood at $84.1 million vs. $79.4 million a year ago. Adjusted EPS of $1.31 exceeded the consensus of $1.25.

As of February 29, cash and cash equivalents stood at ~$267 million.

Dividend: The company distributed excess cash to stockholders through a special dividend.

On April 3, 2024, the Board of Directors declared a one-time $1.00 per share special dividend payable on April 30, 2024, to shareholders of record on April 19, 2024. 

As of February 29, the company had 54 warehouse clubs in operation versus 50 the prior year.

PriceSmart has purchased land and plans to open its ninth warehouse club in Costa Rica, located in Cartago. The club will be built on a six-acre property and is anticipated to open in early 2025.

Investors can gain exposure to the stock via Invesco S&P SmallCap Consumer Staples ETF PSCC and SPDR S&P Retail ETF XRT.

Price Action: PSMT shares are up 1.97% at $84.73 premarket on the last check Wednesday.