PriceSmart (PSMT) Q1 2025 earnings summary

Executive summary

• Net merchandise sales for Q1 FY2025 were $1.22 billion, up 7.8% year-over-year (8.2% in constant currency), with total revenue at $1.26 billion.

• Membership accounts grew 4.8% to over 1.9 million, with a renewal rate of 87.8% and membership income up 13.8% to $20.2 million.

• Private label sales increased to 27.7% of total merchandise sales, up 50 basis points year-over-year.

• Digital channel/omni-channel sales reached 5.7% of total net merchandise sales, with digital sales up 21.1% year-over-year.

• Ongoing expansion includes new club openings in Cartago, Costa Rica (spring 2025) and Quetzaltenango, Guatemala (summer 2025), bringing the total to 56 clubs.

Financial highlights

• Operating income was $58.3 million, nearly flat year-over-year.

• Net income was $37.4 million ($1.21 per diluted share), down from $38 million ($1.24 per share) year-over-year.

• Adjusted EBITDA was $79.1 million, up from $77.8 million in the prior year.

• Gross margin decreased 20 basis points to 15.9% of net merchandise sales.

• Effective tax rate dropped to 26.5% from 32.3% due to tax optimization initiatives.

Outlook and guidance

• Two new clubs are expected to open in 2025, supporting continued growth in emerging markets.

• Continued investment in technology, omni-channel capabilities, and distribution expected to drive future efficiencies, though full benefits may not be realized in FY2025.

• Plans to further expand wellness services, including new pharmacy and optical locations in FY25.