Costco declares $3.1B special dividend
ISSAQUAH, Wash. — Costco declared a special cash dividend on Costco common stock of $7 per share, payable May 26, to shareholders of record at the close of business on May 10. The aggregate payment will be approximately $3.1 billion.
The special dividend will be funded primarily through additional borrowings. The special dividend will be in addition to the Company’s regular quarterly cash dividend of 50 cents per share that was also declared, which will also be payable on May 26 to shareholders of record at the close of business on May 12, 2017. This amount represents a quarterly increase of 5 cents per share.
“Today’s announcement of a $7 special dividend is our latest step in returning capital to our shareholders,” said Richard Galanti, EVP and CFO. “Our strong balance sheet and favorable access to the credit markets allow us to provide shareholders with this dividend, while preserving financial and operational flexibility to continue to grow our business globally. Costco will continue to be in a financial position allowing us to take care of our employees, enhance the value of the Costco membership, and create shareholder value over the long term.”
Costco currently operates 729 warehouses, including 508 in the United States and Puerto Rico.
Walmart’s tech incubator names CEO
BENTONVILLE, Ark. — Walmart’s technology incubator, Store No. 8, hired Jennifer Fleiss as its CEO, according to several media reports.
Fleiss is a co-founder of Rent the Runway, stepped down from the online clothing-rental service earlier this year. At Walmart, she will lead Code Eight, which will develop “highly personalized, one-to-one shopping experiences,” according to a statement.
Walmart announced the creation of Store No. 8, a technology incubator that will be based in the Silicon Valley. The initiative, announced in March, is named after an early Walmart store that company founder Sam Walton used to try out new retail strategies. It was created to identify trends that are reshaping the shopping experience, including virtual reality, robotics and personalized shopping.
Fleiss, a Harvard Business School graduate, remains a board member of Rent the Runway, which she helped found in 2009. She and fellow Harvard alum Jennifer Hyman have raised $190 million in venture capital for Rent the Runway, according to reports.
New NACDS Chairman: Pharmacy can play a leading role
SCOTTSDALE, Ariz. — Chief merchant and CFO of H-E-B, Martin Otto, officially handed over the National Association of Drug Stores chairman gavel to Co-chief operating officer of Walgreens Boots Alliance and president of Walgreens Alex Gourlay during the NACDS Tuesday morning General Session II.
In introducing Gourlay, Otto (pictured right in the photo) said: “His climb up the corporate ladder has been due to a few basic beliefs. In particular, a commitment to hard work, staying true to people in business and doing the right thing. A keen eye for detail has also been his trademark. … He and his team are tough competitors, who are committed to making a difference for their customers and I look forward to working together with him in the coming year.”
“I hope my tenure as NACDS chairman is as successful as yours,” Gourlay responded to Otto in kind.
“I take my responsibilities as [NACDS chairman] seriously and will work hard to ensure we take leadership forward,” he added.
Following the ceremony, Gourlay stated pharmacy and NACDS can truly play a leading role.
“We are very well positioned as a pharmacy-centric organization to make a difference in peoples’ lives in big and small ways,” he said. “However, it’s not going to be easy.”
Two goals of Gourlay’s tenure will be focusing on building trust and improving efficiency. “This marketplace in America is very inefficient. I can give you a 101 examples of things I see and compare and contrast to Europe that could be made much more efficient in this marketplace. There is a huge opportunity for us to not only become more accessible, but more affordable.”
Regarding lingering challenges, Gourlay cited global unrest and political uncertainty as one major hindrance to growth. On the retail front, he added many challenges lay ahead as well.
“There have been more bricks-and-mortar stores close in the last three months than the previous decade. That’s incredible.”
America’s growing spend on healthcare is another source of concern, said Gourlay, adding the quality of healthcare is “not good enough. People are dying young in this country and many more have chronic diseases like diabetes.”
A moment of truth
David Pothast, U.S. chief customer officer, Johnson & Johnson Consumer, kicked off the General Session II by asserting that shoppers have tremendous power, and while price is still important, is no longer everything.
“We are experience a mobile moment of truth,” he said. “ … We need to embrace the new marketplace.”
He cited two examples of retailers he truly admires, Panera and Apple.
Regarding Panera, Pothast said the retailer’s success is predicated on two things.
“It’s the best service you can imagine. It’s based on attitude.”
And zeroing in on Apple, he questioned out loud why its stores are always packed.
“It’s the experience they create. We need to do more of this in our industry,” said Pothast.
The event closed with commentary from Richard Fisher, former president and CEO of the Federal Reserve Bank of Dallas, who discussed the both the political and financial climate in the United States.
“I believe the United States has been a uniquely successful experiment that’s been an example to the rest of the world,” he said. “Which means we have an obligation to continue to be exemplary.”