Costco: Lower petrol prices help drive profit surge
The UK arm of Costco has said lower petrol prices have actually helped its profit jump to almost £200m after driving up memberships.
The division of the US giant said a decrease in prices at the pumps during its latest financial year contributed to increasing the number of people signing up and renewing their membership which in turn helped boost shoppers at its warehouses.
The membership-based retailer, which operates 29 locations across the UK, has reported a pre-tax profit of £188.9m for the year to 1 September, 2024, up from the £139.2m it achieved in the prior 12 months.
New accounts filed with Companies House also show Costco’s turnover increased from £5bn to £5.3bn over the same period.
The results have also revealed that the UK arm of Costco grew its headcount from 8,194 to 8,654 in the year.
A statement signed off by the board said: “The company continues to face challenges from inflation in commodities, utility costs and labour.
“Despite these pressures, buying and operations teams have shown remarkable resilience and dedication in implementing strategies to mitigate the impact on both our members and the business.
“To partially counteract these cost increases, we continued to improve operating efficiencies.”
Costco: ‘Lower petrol prices are a positive’
On its future, Costco added: “Our outlook remains optimistic as our business continues to grow its value reputation and membership base, leverage pricing through higher volumes, improve efficiency and enhance its online platform, offers and services.
“Although petrol business has experienced a slight decrease in sales due to price deflation, it continues to have a positive impact on our membership sign ups and renewals, which in turn has resulted in higher footfall in our warehouses.
“We believe our business is scaleable, resilient and agile.
“Drawing on a greater depth of product lines now afforded by our suppliers, economics of scale, the power of global buying and a well-funded infrastructure, we will continue to offer our members a wide range of quality products and competitive prices, whether they shop with us in our warehouses or through our e-commerce channel.”