PriceSmart Inc. Files Q1 2025 10-Q Report

TL;DR

PSMT Q1 10-Q filed. Financials updated.

AI Summary

PriceSmart Inc. filed its 10-Q for the period ending November 30, 2024. The filing details the company's financial performance and position, including net merchandise sales and various assets and liabilities. The report covers the first quarter of their fiscal year.

Why It Matters

This filing provides investors with an update on PriceSmart's financial health and operational performance, crucial for understanding the company's trajectory in the retail sector.

Risk Assessment

Risk Level: low — This is a routine quarterly financial filing with no immediate red flags.

Key Numbers

• 2024-11-30 — Period End Date (The end of the reporting quarter.)
• 2025-01-08 — Filing Date (The date the report was submitted to the SEC.)

Key Players & Entities

• PRICESMART INC (company) — Filer
• 20241130 (date) — Period of Report
• 20250108 (date) — Filing Date
• SAN DIEGO (location) — Business Address City
• DE (location) — State of Incorporation

FAQ

Key Financial Figures

• $0.0001 — ange on which registered Common Stock, $0.0001 par value PSMT NASDAQ Global Select Mar

Filing Documents

• psmt-20241130.htm (10-Q) — 1425KB
• psmt-20241130xexx311.htm (EX-31.1) — 10KB
• psmt-20241130xexx312.htm (EX-31.2) — 10KB
• psmt-20241130xexx321.htm (EX-32.1) — 4KB
• psmt-20241130xexx322.htm (EX-32.2) — 4KB
• 0001041803-25-000007.txt ( ) — 7690KB
• psmt-20241130.xsd (EX-101.SCH) — 56KB
• psmt-20241130_cal.xml (EX-101.CAL) — 91KB
• psmt-20241130_def.xml (EX-101.DEF) — 228KB
• psmt-20241130_lab.xml (EX-101.LAB) — 657KB
• psmt-20241130_pre.xml (EX-101.PRE) — 445KB
• psmt-20241130_htm.xml (XML) — 1156KB

- FINANCIAL INFORMATION

PART I - FINANCIAL INFORMATION ITEM 1.

FINANCIAL STATEMENTS

FINANCIAL STATEMENTS 1 CONSOLIDATED BALANCE SHEETS AS OF NOVEMBER 30, 2024 (UNAUDITED) AND AUGUST 31, 2024 2 CONSOLIDATED STATEMENTS OF INCOME FOR THE THREE MONTHS ENDED NOVEMBER 30, 2024 AND 2023 - UNAUDITED 4 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE THREE MONTHS ENDED NOVEMBER 30, 2024 AND 2023 - UNAUDITED 5 CONSOLIDATED STATEMENTS OF EQUITY FOR THE THREE MONTHS ENDED NOVEMBER 30, 2024 AND 2023 - UNAUDITED 6 CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE THREE MONTHS ENDED NOVEMBER 30, 2024 AND 2023 - UNAUDITED 7

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - UNAUDITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - UNAUDITED 9 ITEM 2.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 30 ITEM 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 51 ITEM 4.

CONTROLS AND PROCEDURES

CONTROLS AND PROCEDURES 52

- OTHER INFORMATION

PART II - OTHER INFORMATION ITEM 1.

LEGAL PROCEEDINGS

LEGAL PROCEEDINGS 53 ITEM 1A.

RISK FACTORS

RISK FACTORS 53 ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS 53 ITEM 3. DEFAULTS UPON SENIOR SECURITIES 53 ITEM 4. MINE SAFETY DISCLOSURES 53 ITEM 5. OTHER INFORMATION 53 ITEM 6. EXHIBITS 54 i Table of Contents

—FINANCIAL INFORMATION

PART I—FINANCIAL INFORMATION

FINANCIAL STATEMENTS

ITEM 1. FINANCIAL STATEMENTS PriceSmart, Inc.'s ("PriceSmart," "we," the "Company" or "our") unaudited consolidated balance sheet as of November 30, 2024 and the consolidated balance sheet as of August 31, 2024, the unaudited consolidated statements of income for the three months ended November 30, 2024 and 2023, the unaudited consolidated statements of comprehensive income for the three months ended November 30, 2024 and 2023, the unaudited consolidated statements of equity for the three months ended November 30, 2024 and 2023, and the unaudited consolidated statements of cash flows for the three months ended November 30, 2024 and 2023 are included herein. Also included herein are the notes to the unaudited consolidated financial statements. 1 Table of Contents PRICESMART, INC. CONSOLIDATED BALANCE SHEETS (AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA) November 30, 2024 (Unaudited) August 31, 2024 ASSETS Current Assets: Cash and cash equivalents $ 120,943 $ 125,364 Short-term restricted cash 3,309 1,383 Short-term investments 101,252 100,165 Receivables, net of allowance for credit losses of $ 52 as of November 30, 2024 and August 31, 2024 23,606 18,847 Merchandise inventories 585,850 528,678 Prepaid expenses and other current assets (includes $ 1,754 and $ 4,480 as of November 30, 2024 and August 31, 2024, respectively, for the fair value of derivative instruments) 57,564 57,910 Total current assets 892,524 832,347 Long-term restricted cash 12,209 9,564 Property and equipment, net 934,087 936,108 Operating lease right-of-use assets, net 100,202 96,415 Goodwill 43,215 43,197 Deferred tax assets 34,801 36,618 Other non-current assets (includes $ 2,962 and $ 1,482 as of November 30, 2024 and August 31, 2024, respectively, for the fair value of derivative instruments) 63,767 61,563 Investment in unconsolidated affiliates 6,877 6,882 Total Assets $ 2,087,682 $ 2,022,694 LIABILITIES AND EQUITY Current Liabilities: Short-term borrowings $ 7,76

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) November 30, 2024 NOTE 1 – COMPANY OVERVIEW AND BASIS OF PRESENTATION PriceSmart, Inc.'s ("PriceSmart," the "Company," "we" or "our") business consists primarily of international membership shopping warehouse clubs similar to, but typically smaller in size than, warehouse clubs in the United States. As of November 30, 2024, the Company had 54 warehouse clubs in operation in 12 countries and one U.S. territory ( ten in Colombia; eight in Costa Rica; seven in Panama; six in Guatemala; five in Dominican Republic; four each in Trinidad and El Salvador; three in Honduras; two each in Nicaragua and Jamaica; and one each in Aruba, Barbados and the United States Virgin Islands), of which the Company owns 100 % of the corresponding legal entities (see Note 2 - Summary of Significant Accounting Policies). In addition, the Company plans to open one warehouse club in Cartago, Costa Rica in the spring of 2025 and one new warehouse club in Quetzaltenango, Guatemala in the summer of 2025. Once these two new clubs are open, the Company will operate 56 warehouse clubs. Our operating segments are the United States, Central America, the Caribbean and Colombia. PriceSmart continues to invest in technology and talent to support the following three major drivers of growth: 1. Invest in Remodeling Current PriceSmart Clubs, Adding New PriceSmart Locations and Opening More Distribution Centers; 2. Increase Membership Value; and 3. Drive Incremental Sales via PriceSmart.com and Enhanced Online, Digital and Technological Capabilities. Basis of Presentation – The interim consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q for interim financial reporting pursuant to the rules and regulations of the U.S. Securities and Exchange Commission ("SEC"). These interim consolidated financial statements should be read in conjunction with the consolidated financial statements and notes inclu

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) In the case of the Company's ownership interest in a real estate development joint venture, both parties to the joint venture share all rights, obligations and the power to direct the activities of the VIE that most significantly impact the VIE's economic performance. As a result, the Company has determined that it is not the primary beneficiary of the VIE and, therefore, has accounted for this entity under the equity method. Under the equity method, the Company's investments in unconsolidated affiliates are initially recorded as an investment in the stock of an investee at cost and are adjusted for the carrying amount of the investment to recognize the investor's share of the earnings or losses of the investee after the date of the initial investment. The Company's ownership interest in a real estate development joint venture the Company has recorded under the equity method as of November 30, 2024 is listed below: Real Estate Development Joint Venture Country Ownership Basis of Presentation GolfPark Plaza, S.A. Panama 50.0 % Equity (1) (1) Joint venture interests are recorded as investment in unconsolidated affiliates on the consolidated balance sheets. Use of Estimates – The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. These estimates and assumptions take into account historical and forward-looking factors that the Company believes are reasonable. Actual results could differ from those estimates and assumptions. Cash and Cash Equivalents – The Company considers as cash and cash equivalents all cash on deposit, highly liquid investments with a maturity of three months or less at the date of purchase and proceeds due from credit and debit card transactions in the process of settlement. In addition, the Company invests some of our ca

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) Tax Receivables – The Company pays Value Added Tax ("VAT") or similar taxes, income taxes, and other taxes within the normal course of business in most of the countries in which it operates related to the procurement of merchandise and/or services the Company acquires and/or on sales and taxable income. VAT is a form of indirect tax applied to the value added at each stage of production (primary, manufacturing, wholesale and retail). This tax is similar to, but operates somewhat differently than, sales tax paid in the United States. The Company generally collects VAT from its Members upon sale of goods and services and pays VAT to its vendors upon purchase of goods and services. Periodically, the Company submits VAT reports to governmental agencies and reconciles the VAT paid and VAT received. The net overpaid VAT may be refunded or applied to subsequent returns, and the net underpaid VAT must be remitted to the government. With respect to income taxes paid, if the estimated income taxes paid or withheld exceed the actual income tax due this creates an income tax receivable. In most countries where the Company operates, the governments have implemented additional collection procedures, such as requiring credit card processors to remit a portion of sales processed via credit and debit cards directly to the government as advance payments of VAT and/or income tax. This collection mechanism generally leaves the Company with net VAT and/or income tax receivables, forcing the Company to process significant refund claims on a recurring basis. These refund or offset processes can take anywhere from several months to several years to complete. Additionally, we are occasionally required to make payments for tax assessments that we are appealing, notwithstanding that we believe it is more likely than not we will ultimately prevail. Minimum tax rules, applicable in some of the countries where the Company operates, requ

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) The following table summarizes the VAT receivables reported by the Company (in thousands): November 30, 2024 August 31, 2024 Prepaid expenses and other current assets $ 992 $ 3,322 Other non-current assets 33,905 30,845 Total amount of VAT receivables reported $ 34,897 $ 34,167 The following table summarizes the Income tax receivables reported by the Company (in thousands): November 30, 2024 August 31, 2024 Prepaid expenses and other current assets $ 19,951 $ 20,088 Other non-current assets 21,376 23,679 Total amount of income tax receivables reported $ 41,327 $ 43,767 Lease Accounting – The Company's leases are operating leases for warehouse clubs and non-warehouse club facilities such as corporate headquarters, regional offices, and regional distribution centers. The Company determines if an arrangement is a lease and classifies it as either a finance or operating lease at lease inception. Operating leases are included in Operating lease right-of-use assets, net; Operating lease liabilities, current portion; and Long-term operating lease liabilities on the consolidated balance sheets. The Company

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