Costco 2014 Annual Report Download - page 2

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THE COMPANY
Costco Wholesale Corporation and its subsidiaries (Costco or the Company) began operations in 1983 in
Seattle, Washington. In October 1993, Costco merged with The Price Company, which had pioneered the
membership warehouse concept, to form Price/Costco, Inc., a Delaware corporation. In January 1997,
after the spin-off of most of its non-warehouse assets to Price Enterprises, Inc., the Company changed its
name to Costco Companies, Inc. On August 30, 1999, the Company reincorporated from Delaware to
Washington and changed its name to Costco Wholesale Corporation, which trades on the NASDAQ
Global Select Market under the symbol “COST.”
As of December 2014, the Company operated a chain of 671 warehouses in 43 states, Washington, D.C.,
and Puerto Rico (474 locations), nine Canadian provinces (88 locations), Mexico (34 locations), the
United Kingdom (26 locations), Japan (20 locations), Korea (11 locations), Taiwan (10 locations, through
a 55%-owned subsidiary), Australia (seven locations) and Spain (one location). The Company’s online
business operates websites in the U.S., Canada, U.K., and Mexico.
CONTENTS
Financial Highlights ..................................................................................................................................... 1
Letter to Shareholders ................................................................................................................................. 2
Map of Warehouse Locations...................................................................................................................... 6
Business Overview ...................................................................................................................................... 8
Risk Factors................................................................................................................................................. 13
Properties: Warehouses, Administration and Merchandise Distribution Properties ................................... 21
Market for Costco Common Stock, Dividend Policy and Stock Repurchase Program ............................... 22
Five Year Operating and Financial Highlights ............................................................................................. 24
Management’s Discussion and Analysis of Financial Condition and Results of Operations ...................... 25
Executive Officers and Corporate Governance ........................................................................................... 37
Management’s Reports ............................................................................................................................... 38
Reports of Independent Registered Public Accounting Firm ...................................................................... 39
Consolidated Financial Statements ............................................................................................................. 41
Notes to Consolidated Financial Statements .............................................................................................. 46
Directors and Officers of the Company ....................................................................................................... 70
Additional Information .................................................................................................................................. 72