Members-only wholesale group, Costco UK has posted a sales uplift of 8% in the full year 2015/16 (to 28 August 2016), taking its turnover over £2bn for the first time.
Around one third of this growth came from the first full year of trading of the new warehouse at Sunbury, opened in August 2015.
Food and grocery categories performed especially well, with tobacco, beers & wines and frozen amongst those noted for outperformance. The business reports that the growth trend continued into H1 of 2016/17, with sales to 12 February 2017 showing 'strong improvement' over 2015/16.
Over the period, Costco added petrol forecourts to four further existing warehouse locations: Bristol, Sheffield, Thurrock and Haydock. Following two further forecourts added at Chester in late 2016 and Manchester in early 2017, Costco now has eight across it portfolio nationally, with more planned to open in the coming months. The expansion of its fuel offer made a significant contribution to overall sales growth in 2015/16, estimated to represent 18% of the total uplift.
The group remains committed to adding 1-2 new warehouses ongoing. Following the opening of its Wembley site in August 2016 (click here for our detailed insight report) it has 28 warehouses, and ultimately sees potential for a total of 35 to 40. Included in its pipeline for future openings is a site in Stevenage, Hertfordshire, acquired in December 2016.
During the year, Costco moved its central distribution function to Crick, Northamptonshire, where it now occupies a 380,000 sq ft facility, with scope for further expansion. In addition, the site supports Costco's online retailing operation, as well as partially supporting its two warehouses in Spain. Crick will also be involved in supporting distribution to the sites in both Iceland and the forthcoming opening in France, near Paris.
Costco Online is reported as wholly separate operation, unconsolidated with the warehouse division. Sales in this online division reached £59.5m in 2015/16, up 29% on the previous year.
Non-food categories comprise substantially the largest parts of the division, with the growth being driven above all by gardening and furniture lines, as well as small appliances.
Having achieved a small profit in 2014/15 Costco Online, made a loss of £1.3m in this latest year, due to an increase in fixed costs linked to the transfer of operations to the new distribution facility at Crick.