Shares of PriceSmart, Inc. fell 6.2% since it reported soft sales for April on May 7. The company also broke its three-month positive comparable net merchandise sales (comps) trend in April. Apparently, comps for the four weeks ended Apr 26, 2020, plunged 19.2% for 41 warehouse clubs. The metric was also hurt by foreign currency fluctuations to the tune of $4.8 million or 2.1%. However, comps rose 15.7%, 1% and 0.3% in March, February and January, respectively.
Net merchandise sales during the month under review declined 10.9% to $216 million from $242.5 million a year ago. This follows a respective increase of 17.1%, 11.7% and 3.9% for March, February and January. Currency-rate fluctuations negatively impacted the metric by $5.5 million or 2.2% in April. The dismal top-line performance in April mainly stemmed from the ill impact of COVID-19, which resulted in lower traffic at the company’s warehouse clubs.
Nevertheless, the company has been working to brave such challenges and is evaluating ways for convenient shopping. Impressively, management started rolling out the 'Click and Go' program across most of its Central America and Colombia markets during April. The latest program enables consumers to shop and place orders online, and then pick-up at club. In addition, its Assisted Shopping Program provides product information online as well as helps deliver orders quickly. Moreover, the company has been boosting its delivery capabilities. These initiatives are minimizing human-to-human contact and in turn containing the spread of the virus.
Encouragingly, net merchandise sales grew 4.9% to $2,172.5 million for the fiscal till Apr 30. The metric was hurt by foreign currency fluctuations to the tune of $28.2 million or 1.3%. For the 34-week period ended Apr 26, 2020, comps increased 0.2% from the year-ago period. The metric was also hurt by foreign currency fluctuations to the tune of $26.3 million or 1.3%.
Shares of this membership shopping warehouse club operator have fallen 13.9% in the past three months compared with the industrys decline of 9.4%.
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