Costco 2009 Annual Report Download

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YEAR ENDED AUGUST 30, 2009
2009
Annual
Report

Table of contents

  • Page 1
    Annual Report YEAR ENDED AUGUST 30, 2009 2009

  • Page 2
    ...and changed its name to Costco Wholesale Corporation, which trades on the NASDAQ under the symbol "COST." As of December 2009, the Company operated a chain of 566 warehouses in 40 states and Puerto Rico (413 locations), nine Canadian provinces (77 locations), the United Kingdom (21 locations), Korea...

  • Page 3
    FINANCIAL... Fiscal Year 2008 2009 0 2005 2006 2007 Fiscal Year 2008 2009 Excludes Mexico At Fiscal Year End *VTWHYHISL...Year 2008 2009 2005 2006 2007 Fiscal Year 2008 2009 (]LYHNL:HSLZ7LY>HYLOV\ZL :HSLZ0U4PSSPVUZ @LHY 6WLULK LMVYL ;V[HSZ VM >OZLZ 101 $101 2000 *First year sales...

  • Page 4
    ... year we opened twenty new warehouses; we increased our membership cardholder base by 2.3 million members, with membership renewals remaining strong at over 87%; and our employees continued to have job security along with one of the best wage and benefits packages in the retail industry. Fiscal 2009...

  • Page 5
    ...in existing markets. We currently operate 566 warehouses across the globe: 413 in the U.S. and Puerto Rico, 77 in Canada, 32 in Mexico, 21 in the United Kingdom, nine in Japan, seven in Korea, six in Taiwan and one in Australia. Our goal is still to double our number of units over the next ten years...

  • Page 6
    ..., build special product sizes and pallet configurations, while offering lower prices and becoming even more competitive in the marketplace. Our ancillary businesses, which include pharmacy, optical, hearing-aid, one-hour photo, food courts and gas stations, continue to offer value to our members...

  • Page 7
    ..., please log on to Costco.com and review our Corporate Sustainability Report, published in January 2009. We know we face challenges. Today's financial environment means that we must work harder than ever before to make a dollar. We must concentrate on cost containment at every level, as well as...

  • Page 8
    ... City of Industry Clovis Coachella Valley Commerce - Bus. Ctr. Concord Corona Culver City Cypress Danville El Camino El Centro Eureka Fairfield Folsom Fontana Foster City Fountain Valley AUSTRALIA HAWAII                  MÉXICO Fremont San Diego Fresno S.E. San...

  • Page 9
    ... City Potomac Mills Sterling Winchester WASHINGTON (28) Aurora Village Bellingham Burlington Clarkston Covington Everett Federal Way Fife - Bus. Ctr. Gig Harbor Issaquah Kennewick Kirkland Lacey Melville Nanuet Nesconset New Rochelle Port Chester Queens Staten Island Westbury Yonkers NORTH CAROLINA...

  • Page 10
    ..., coupon mailers, weekly email blasts from costco.com, and handouts) to existing members promoting selected merchandise. These practices result in lower marketing expenses as compared to typical retailers. In connection with new warehouse openings, our marketing teams personally contact businesses...

  • Page 11
    ... products are offered for sale in case, carton, or multiple-pack quantities only. In keeping with our policy of member satisfaction, we generally accept returns of merchandise. On certain electronic items, we have a 90-day return policy in the United States, Canada and the United Kingdom and provide...

  • Page 12
    ...the number of ancillary businesses in operation at fiscal year end: 2009 2008 2007 Food Court and Hot Dog Stands ...One-Hour Photo Centers ...Optical Dispensing Centers ...Pharmacies ...Gas Stations ...Hearing-Aid Centers ...Print Shops and Copy Centers ...Car Washes ...Number of warehouses ... 521...

  • Page 13
    ... services are generally provided by third-parties and vary by country and state. In addition, Executive members qualify for a 2% annual reward (which can be redeemed at Costco warehouses), up to a maximum of approximately $500 per year, on all qualified purchases made at Costco. At the end of 2009...

  • Page 14
    ..., warehouse location and member service. Over 1,200 warehouse club locations exist across the U.S. and Canada, including our 483 North American warehouses, and every major metropolitan area has several club operations. In addition to other membership warehouse operators such as Wal-Mart's Sam's Club...

  • Page 15
    ... to reduce Costco's use of resources and generation of waste; and to lead by example. The group has been developing company-wide solutions to manage some aspects of our business most directly related to sustainability, including: data research, tracking and analysis; policy development; designing or...

  • Page 16
    ...for use in any Costco warehouse or at Costco.com. By refurbishing, recycling and keeping renewable materials out of landfills and incinerators, Costco has found new revenue streams while helping protect the environment. Energy Efficient Products and Innovative Packaging We have been an active member...

  • Page 17
    ... members, employees, warehouse sites, products and services and in other important respects with many other local, regional and national retailers, both in the United States and in foreign countries. We compete with other warehouse club operators, discount retailers, supermarkets, supercenter stores...

  • Page 18
    ... prices. We have no assurances of continued supply, pricing or access to new products, and any vendor could at any time change the terms upon which it sells to us or discontinue selling to us. Member demands may lead to out-of-stock positions of our merchandise, leading to loss of sales and profits...

  • Page 19
    ... our financial results. Damage to our brands or reputation may negatively impact comparable warehouse sales, lower employee morale and productivity, diminish member trust, and reduce member renewal rates and, accordingly, membership fee revenues, resulting in a reduction in shareholder value. 17

  • Page 20
    ... effect upon future claim costs and currently recorded liabilities and could materially impact our consolidated financial statements. Changes in Tax Rates We compute our income tax provision based on enacted tax rates in the countries in which we operate. As the tax rates vary among countries...

  • Page 21
    ... and earnings per share or new warehouse openings, could cause the market price of our stock to decline, as could changes in our dividend or share repurchase policies. We rely extensively on computer systems to process transactions, summarize results and manage our business. Disruptions in both...

  • Page 22
    ... our locations, which could have a material adverse effect on our business, financial condition, and results of operations. These events could also reduce demand for our products or make it difficult or impossible to receive products from suppliers. We are subject to a wide variety of federal, state...

  • Page 23
    ... effect on the Company's business, results of operations and financial condition. The Company does not maintain key man insurance. If we do not maintain the privacy and security of member-related information, we could damage our reputation with members, incur substantial additional costs and become...

  • Page 24
    ... At August 30, 2009, we operated 527 membership warehouses: NUMBER OF WAREHOUSES Own Land and Building Lease Land and/or Building(1) Total United States and Puerto Rico ...Canada ...United Kingdom ...Japan ...Korea ...Taiwan ...Australia ...Total ... 323 68 19 1 3 - 1 415 83 9 2 8 4 6 - 112...

  • Page 25
    ...($54.08 per share) through 2009 fiscal year end. The maximum remaining dollar value of shares that may be purchased under the stock repurchase program is $2,002. There was no common stock repurchase program activity for the fourth quarter of 2009. Equity Compensation Plans Information related to our...

  • Page 26
    ... Club, Inc.; The Home Depot, Inc.; Lowe's Companies; Best Buy Co., Inc.; Office Depot, Inc.; Staples Inc.; Target Corporation; Kroger Company; and Wal-Mart Stores, Inc. The information provided is from August 29, 2004 through August 30, 2009. COMPARISON OF 5-YEAR CUMULATIVE TOTAL RETURN AMONG COSTCO...

  • Page 27
    ... be read in conjunction with Management's Discussion and Analysis of Financial Condition and Results of Operations, and our Consolidated Financial Statements. SELECTED FINANCIAL DATA (dollars in millions, except per share and warehouse data) Aug. 30, 2009 (52 weeks) Aug. 31, 2008 (52 weeks) Sept...

  • Page 28
    ...Costco Home locations) in 2009. Net sales were significantly impacted by the year-over-year decrease in the price of gasoline and by certain foreign exchange rates; Membership fees increased 1.8%, to $1,533, primarily due to new membership sign-ups at warehouses opened in 2009, the continued benefit...

  • Page 29
    ...of our current year results to prior years. The impact of each of these items noted above is presented below: 2007 Sales return reserve Employee tax consequences on stock options Deferred membership Excise tax refund Total Net sales ...Membership fees ...Total revenue ...Merchandise costs ...Gross...

  • Page 30
    ...comparable warehouse sales and $2,284 primarily from sales at new warehouses opened during 2008 and 2007. In the third quarter of 2007, we introduced a 90-day return policy in the United States on certain electronic items. Significantly stronger foreign currencies, particularly in Canada, positively...

  • Page 31
    ... the U.S. dollar, particularly in Canada, the United Kingdom, and Korea, which negatively impacted membership fees during 2009 by approximately $50. Membership fees were also impacted by a lower number of warehouse openings year-over-year. Our member renewal rate, currently at 87% is consistent with...

  • Page 32
    ...one-hour photo, tire shop and food services, partially offset by an increase in our gasoline business; a $32, or five basis point LIFO charge, resulting from price increases in certain food items and gasoline; and a three basis point decrease resulting from the increased penetration of the Executive...

  • Page 33
    ...the timing of the opening relative to our year-end, whether the warehouse is owned or leased, whether the opening is in an existing, new, or international market. The decline in 2009 is primarily attributable to fewer warehouse openings. Provision for Impaired Assets and Closing Costs, Net 2009 2008...

  • Page 34
    ...by $19 of net gain on the sale of real property, largely former warehouse locations. At the end of both 2009 and 2008, the reserve for warehouse closing costs was $5 and primarily related to future lease obligations. Interest Expense 2009 2008 2007 Interest expense ...2009 vs. 2008 $108 $103 $64...

  • Page 35
    ... share, related to a proposed litigation settlement concerning our membership renewal policy, as well as a $23 pre-tax charge, or approximately $0.03 per diluted share, for an adjustment to the net realizable value of the cash surrender value of employee life insurance contracts. Net income for 2009...

  • Page 36
    ..., approximately $758 and $788 at the end of 2009 and 2008, respectively, represented debit and credit card receivables, primarily related to sales in the week prior to the end of the fiscal year. Net cash provided by operating activities totaled $2,092 in 2009 compared to $2,206 in 2008, a decrease...

  • Page 37
    ... and the excess tax benefit on share-based awards of $276, a decrease in the net proceeds from short-term borrowings of $195 as well as a decrease in the cash provided by the issuance of longterm debt of $103. The effect of exchange rate changes, reflected in the consolidated statement of cash flows...

  • Page 38
    ... financing of land, building, and equipment costs for new and remodeled warehouses. Capital is also required for initial warehouse operations and working capital. While there can be no assurance that current expectations will be realized and plans are subject to change upon further review, it is our...

  • Page 39
    ... Rate Entity Credit Facility Description Expiration Date U.S...U.S...Australia(1) ...Canada(1, 3) ...Japan(1) ...Japan(1) ...Japan(1) ...Korea(1) ...Taiwan ...Taiwan ...United Kingdom ...United Kingdom ...United Kingdom ...United Kingdom(2) ...United Kingdom ... Uncommitted Stand By Letter of...

  • Page 40
    ... gross proceeds of $450. The current Zero Coupon Notes outstanding are convertible into a maximum of 961,000 shares of Costco Common Stock shares at an initial conversion price of $22.71. Holders of the Zero Coupon Notes may require us to purchase the Zero Coupon Notes (at the discounted issue price...

  • Page 41
    ... the end of 2009. Purchases are made from time-to-time as conditions warrant in the open market or in block purchases, and pursuant to plans under SEC Rule 10b5-1. Repurchased shares are retired, in accordance with the Washington Business Corporation Act. Critical Accounting Policies The preparation...

  • Page 42
    ... for membership fee revenue on a deferred basis, whereby revenue is recognized ratably over the one-year membership period. Our Executive members qualify for a 2% reward (which can be redeemed only at Costco warehouses), up to a maximum of $500 per year, on all qualified purchases made at Costco. We...

  • Page 43
    ...their then-current fair market value. We provide estimates for warehouse closing costs for both leased and owned locations to be closed or relocated. A considerable amount of judgment is involved in determining any impairment or our net liability, particularly related to the estimated sales price of...

  • Page 44
    ... debt and may affect the interest expense related to the variable rate debt. See Note 3 to the consolidated financial statements included in Part II, Item 8 of this Report for more information on our long and short-term debt. Foreign Currency-Exchange Risk Our foreign subsidiaries conduct limited...

  • Page 45
    ...Costco's Proxy Statement for our Annual Meeting of Shareholders to be held on January 28, 2010. A list of the names and positions of the Directors, as well as the Executive and Senior Officers of our Company, appears on page 90 of this report. The following is a list of the names, ages and positions...

  • Page 46
    ... the standards of the Public Company Accounting Oversight Board (United States). The independent registered public accounting firm's responsibility is to express an opinion as to the fairness with which such financial statements present our financial position, results of operations and cash flows in...

  • Page 47
    ... Control- Integrated Framework. Based on its assessment, management has concluded that our internal control over financial reporting was effective as of August 30, 2009. James D. Sinegal President Chief Executive Officer Richard A. Galanti Executive Vice President Chief Financial Officer 45

  • Page 48
    ... financial statements referred to above present fairly, in all material respects, the consolidated financial position of Costco Wholesale Corporation and subsidiaries as of August 30, 2009 and August, 31, 2008, and the results of their operations and their cash flows for the 52-week periods ended...

  • Page 49
    ... Public Company Accounting Oversight Board (United States), the consolidated balance sheets of the Company as of August 30, 2009 and August 31, 2008, and the related consolidated statements of income, stockholders' equity and comprehensive income, and cash flows for each of the 52-week periods ended...

  • Page 50
    COSTCO WHOLESALE CORPORATION CONSOLIDATED BALANCE SHEETS (dollars in millions, except par value and share data) August 30, 2009 August 31, 2008 ASSETS CURRENT ASSETS Cash and cash equivalents ...Short-term investments ...Receivables, net ...Merchandise inventories ...Deferred income taxes and other...

  • Page 51
    COSTCO WHOLESALE CORPORATION CONSOLIDATED STATEMENTS OF INCOME (dollars in millions, except per share data) 52 weeks ended August 30, 2009 52 weeks ended August 31, 2008 52 weeks ended September 2, 2007 REVENUE Net sales ...Membership fees ...Total revenue ...OPERATING EXPENSES Merchandise costs ...

  • Page 52
    COSTCO WHOLESALE CORPORATION CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY AND COMPREHENSIVE INCOME (dollars in millions, except share data) Common Stock Shares Amount Additional Paid-In Capital Accumulated Other Comprehensive Income Retained Earnings Total BALANCE AT SEPTEMBER 3, 2006 ......

  • Page 53
    ...earnings ...Accretion of discount on long-term debt ...Excess tax benefit on share based awards ...Other-than-temporary impairment loss on investments ...Other non-cash items, net ...Change in deferred income taxes ...Change in receivables, other current assets, deferred membership fees, accrued and...

  • Page 54
    ... facilities. At August 30, 2009, Costco operated 527 warehouses in 40 states and Puerto Rico (406 locations), nine Canadian provinces (77 locations), the United Kingdom (21 locations), Japan (nine locations), Korea (seven locations), Taiwan (six locations) and Australia (one location), as well as 32...

  • Page 55
    ... of the specific identification method. Vendor Receivables and Allowances Periodic payments from vendors in the form of volume rebates or other purchase discounts that are evidenced by signed agreements are reflected in the carrying value of the inventory when earned or as the Company progresses...

  • Page 56
    ...all foreign operations are primarily valued by the retail inventory method and are stated using the first-in, first-out (FIFO) method. The Company believes the LIFO method more fairly presents the results of operations by more closely matching current costs with current revenues. The Company records...

  • Page 57
    ... not material. The Company did not make any capital contributions to its investment in Costco Mexico in 2009, 2008, or 2007. The Company adjusts the carrying value of its life insurance contracts to the net cash surrender value at the end of each reporting period. The adjustment reflects changes in...

  • Page 58
    Accounts Payable The Company's banking system provides for the daily replenishment of major bank accounts as checks are presented. Accordingly, included in accounts payable at the end of 2009 and 2008 are $611 and $640, respectively, representing the excess of outstanding checks over cash on deposit...

  • Page 59
    ... relationship. There can be no assurance, however, that this effectively mitigates counterparty risk. In addition, the contracts are limited to a time period of less than one year. See Note 3 for information on the fair value of these contracts. At the end of 2009, the fair value of the Company...

  • Page 60
    ... current and historical financial statements was not material. As previously disclosed, effective with renewals occurring on and after March 1, 2009, the Company changed an element of its membership renewal policy. Memberships renewed within two months after expiration of the current membership year...

  • Page 61
    ... of certain membership fees paid by late-renewing members, the effect is not expected to be material. The Company's Executive members qualify for a 2% reward, which can be redeemed at Costco warehouses, up to a maximum of $500 per year, on all qualified purchases made at Costco. The Company accounts...

  • Page 62
    ...useful life through the expected closing date and remaining lease obligations, net of estimated sublease income, for leased locations. At the end of both 2009 and 2008, the Company's reserve for warehouse closing costs was $5 and primarily related to future lease obligations. Fair Value of Financial...

  • Page 63
    ...common shares outstanding using the treasury stock method for shares subject to stock options and restricted stock units and the "if converted" method for the convertible note securities. Stock Repurchase Programs Shares repurchased are retired, in accordance with the Washington Business Corporation...

  • Page 64
    ... ending after June 15, 2009. The Company adopted these new requirements in its fourth quarter of 2009. Adoption of this standard had no material impact on the Company's consolidated financial statements. In April 2009, three FASB Staff Positions (FSP) were issued addressing fair value of financial...

  • Page 65
    ... Company's investments at August 30, 2009 and August 31, 2008, were as follows: Balance Sheet Classification 2009: Cost Basis Unrealized Gains Unrealized Losses Recorded Basis Short-term Investments Other Assets Available-for-sale: Money market mutual funds ...U.S. government and agency securities...

  • Page 66
    ..., respectively, and gross realized losses from sales were $2 and $1 in 2009 and 2007, respectively. In 2008, gross realized losses from sales were not significant. The following tables present the length of time available-for-sale securities were in continuous unrealized loss positions, but were not...

  • Page 67
    ... and changed to a floating net asset value. In light of the restricted liquidity, the Company elected to receive a pro-rata allocation of the underlying securities in a separately managed account. The Company assessed the fair value of these securities through market quotations and review of current...

  • Page 68
    ... asset and mortgage-backed securities, and forward foreign exchange contracts. Valuation methodologies are based on "consensus pricing," using market prices from a variety of industry-standard independent data providers or pricing that considers various assumptions, including time value, yield curve...

  • Page 69
    ...individual securities as of the beginning of the reporting period in which the transfer occurred. During the fourth quarter of 2009, the Company expanded its description of Level 3 input evaluation to address pricing elements of adopting FSP 157-4. This updated description did not change the current...

  • Page 70
    ...of Credit Australia(1) ...Guarantee Line Canada(1) ...Multi-Purpose Line Japan(1) ...Revolving Credit Japan(1) ...Bank Guaranty Japan(1) ...Revolving Credit Japan(2) ...Commercial Letter of Credit Korea(1) ...Multi-Purpose Line Taiwan ...Multi-Purpose Line Taiwan ...Multi-Purpose Line United Kingdom...

  • Page 71
    ... Line Canada(1, 3) ...MultiPurpose Line Japan(1) ...Revolving Credit Japan(1) ...Bank Guaranty Japan(1) ...Revolving Credit Korea(1) ...MultiPurpose Line Taiwan ...MultiPurpose Line Taiwan ...MultiPurpose Line United Kingdom ...Revolving Credit United Kingdom ...Uncommitted Money Market United...

  • Page 72
    ... Year Average Amount Outstanding During the Fiscal Year Weighted Average Interest Rate During the Fiscal Year Year ended August 30, 2009 Bank borrowings: Canada ...United Kingdom ...Japan ...Bank overdraft facility: United Kingdom ...Other: United Kingdom Money Market Line Borrowing ...Year ended...

  • Page 73
    .... The current Zero Coupon Notes outstanding are convertible into a maximum of 961,000 shares of Costco Common Stock shares at an initial conversion price of $22.71. Holders of the Zero Coupon Notes may require the Company to purchase the Zero Coupon Notes (at the discounted issue price plus accrued...

  • Page 74
    ... The Company leases land and/or buildings at 112 of the 527 warehouses open at August 30, 2009, and certain other office and distribution facilities primarily under operating leases. These leases expire at various dates through 2049, with the exception of one lease in the Company's United Kingdom...

  • Page 75
    ... the stock repurchase balances in the consolidated statements of cash flows to the extent that repurchases had not settled at the end of the fiscal year. Purchases are made from time-to-time as conditions warrant in the open market or in block purchases, and pursuant to share repurchase plans under...

  • Page 76
    ... awarded RSU grants continue to involve daily vesting upon certain terminations of employment. Additionally, employees who attain certain years of service with the Company will receive shares under accelerated vesting provisions on the annual vesting date rather than upon qualified retirement. The...

  • Page 77
    ...39.62 At the end of 2008 and 2007, there were 15,735 and 19,283 options exercisable at weighted average exercise prices of $39.14 and $38.35, respectively. The tax benefits realized and intrinsic value related to total stock options exercised during 2009, 2008 and 2007 are provided in the following...

  • Page 78
    ... with this review and guidance issued by the U.S. Internal Revenue Service in 2006, the Compensation Committee of the Board of Directors approved a program intended to protect approximately 1,000 Company employees who are United States taxpayers from certain adverse tax consequences resulting...

  • Page 79
    ... completed 90 days of employment. For all U.S. employees, with the exception of California union employees, the plan allows pre-tax deferrals against which the Company matches 50% of the first one thousand dollars of employee contributions. In addition, the Company provides each eligible participant...

  • Page 80
    ...Company files income tax returns in the United States, various state and local jurisdictions, in Canada and in several other foreign jurisdictions. With few exceptions, the Company is no longer subject to U.S. federal, state or local examination for years before fiscal 2004. The Company is currently...

  • Page 81
    ... Puerto Rico) ...Foreign ...Total ... $1,426 288 $1,714 $1,542 457 $1,999 $1,374 336 $1,710 The provisions for income taxes for 2009, 2008, and 2007 are as follows: 2009 2008 2007 Federal: Current ...Deferred ...Total federal ...State: Current ...Deferred ...Total state ...Foreign: Current...

  • Page 82
    ...operations. In 2009, the distribution was not material. The Company has not provided for U.S. deferred taxes on cumulative undistributed earnings of certain non-U.S. affiliates, including its 50% owned investment in the Mexico corporate joint venture, aggregating $1,554 and $1,235 at the end of 2009...

  • Page 83
    ...rates of pay for all department and ancillary managers in California in violation of Labor Code Section 515(d). On October 2, 2009, the court granted the Company's motion for summary judgement. Terry Head v. Costco Wholesale Corp., Superior Court for the County of Los Angeles, Case No. BC-409805. In...

  • Page 84
    ... to the United States District Court for the Eastern District of New York), it is asserted that the Company violated various provisions of California and New York common law and statutes in connection with a membership renewal practice. Under that practice, members who paid their renewal fees late...

  • Page 85
    ... New Mexico, North Carolina, South Carolina, Tennessee, Texas, Utah, and Virginia. Other than payments to class representatives, the settlement does not provide for cash payments to class members. On August 18, 2009, the court preliminarily approved the settlement and set a hearing for April 1, 2010...

  • Page 86
    ... class action relating to sales of certain waffles, which alleges that labeling (provided by the Company's supplier) of these items was deceptive and misleading. Hodes, et al., v. Van's International Foods, et al., United States District Court for the Central District of California, Case No...

  • Page 87
    ... States Attorney's Office for the Central District of California, seeking records relating to the Company's receipt and handling of hazardous merchandise returned by Costco members and other records. The Company is cooperating with the inquiry and at this time cannot reasonably estimate any loss...

  • Page 88
    ... (m) at warehouses in these four states. The Company has responded to these allegations, is engaged in communications with the Department about these and additional allegations made by letter dated September 10, 2009, and has entered into a tolling agreement. An Information Request, dated January 14...

  • Page 89
    ...is accounted for under the equity method and its operations are not consolidated in the Company's financial statements. United States Operations(a) Canadian Operations Other International Operations Total Year Ended August 30, 2009 Total revenue ...Operating income ...Depreciation and amortization...

  • Page 90
    ... results of operations for 2009 and 2008. 52 Weeks Ended August 30, 2009 First Quarter 12 Weeks Second Quarter 12 Weeks Third Quarter 12 Weeks Fourth Quarter 16 Weeks Total 52 Weeks REVENUE Net sales ...Membership fees ...Total revenue ...OPERATING EXPENSES Merchandise costs ...Selling, general...

  • Page 91
    ... Weeks Second Quarter 12 Weeks Third Quarter 12 Weeks Fourth Quarter 16 Weeks Total 52 Weeks REVENUE Net sales ...Membership fees ...Total revenue ...OPERATING EXPENSES Merchandise costs ...Selling, general and administrative ...Preopening expenses ...Provision for impaired assets and closing costs...

  • Page 92
    ..., Costco Wholesale Industries & Business Development Richard D. DiCerchio Senior Executive Vice President, COO - Global Operations, Distribution & Construction John B. Gaherty Senior Vice President, General Manager - Midwest Region Richard A. Galanti Executive Vice President, Chief Financial Officer...

  • Page 93
    ... Court Deb Cain GMM - Foods - Northwest Region Deborah Calhoun GMM - Foods - San Diego Region Patrick Callans Corporate Purchasing and Business Centers Richard Chang Country Manager - Taiwan Jeff Cole U.S. Gas Purchasing & Operations Julie Cruz Operations - Southeast Region Victor Curtis Pharmacy...

  • Page 94
    ... Room, please contact the SEC at 1-800-SEC-0330. Additionally, the SEC maintains an internet site that contains reports, proxy and information statements and other information regarding issuers that file electronically with the SEC at www.sec.gov. Corporate Office 999 Lake Drive Issaquah, WA 98027...

  • Page 95

  • Page 96