PriceSmart(PSMT)2025-04-10 16:00Financial Data and Key Metrics Changes - In the second quarter, net merchandise sales reached over 1.4 billion [14] - Net merchandise sales increased by 0.8% or 7% in constant currency during the second quarter [15] - Net income for the second quarter was 1.45 per diluted share, compared to 1.31 per diluted share in the same quarter last year [25] - Adjusted EBITDA for the second quarter was 84.1 million in the same period last year [25] - Total gross margins as a percentage of net merchandise sales decreased by 10 basis points to 26.6% [21] Business Line Data and Key Metrics Changes - In Central America, net merchandise sales increased by 0.4% or 0.6% in constant currency [15] - In the Caribbean, net merchandise sales increased by 0.4% or 0.6% in constant currency [16] - In Colombia, net merchandise sales increased by 0.6% or 16% in constant currency [17] - Membership accounts grew by 0.1% to over 1.9 million accounts, with a 12-month removal rate of 87% [18] Market Data and Key Metrics Changes - All markets in Central America had positive comparable net merchandise sales growth, except for El Salvador [15] - The Caribbean region contributed approximately 230 basis points to the growth in total consolidated comparable net merchandise sales for the second quarter [16] - Colombia contributed approximately 100 basis points to the growth in total consolidated comparable net merchandise sales for the quarter [17] Company Strategy and Development Direction - The company is focusing on enhancing its distribution infrastructure and plans to open new warehouse clubs in Guatemala and other locations [30][31] - The company is actively seeking ways to improve its distribution network, including operating its own fleet of trucks [33] - The company is investing in technology to enhance supply chain efficiency and improve the member experience [44] Management's Comments on Operating Environment and Future Outlook - Management acknowledged ongoing tariff challenges and emphasized the importance of sourcing products locally and regionally [10][11] - The company is developing contingency plans to adapt to the uncertain tariff environment [12] - Management expressed optimism about the growth opportunities in digital channels and plans to continue investing in this area [44] Other Important Information - The company opened its ninth warehouse club in Costa Rica during the quarter [9] - The effective tax rate for the second quarter was 22% compared to 25% a year ago, primarily due to tax optimization initiatives [24] - The company has seven recycling centers open and plans to expand this program [46] Q&A Session Summary Question: Impact of tariffs on merchandise sourcing - Management is not aware of any reciprocal tariffs imposed by Central American countries and believes the impact will be minimal [55][60] Question: Future store openings - Management disclosed that there are up to six locations in various stages of due diligence and permitting, but no specific timing was provided [66]