NOTE 18 – QUARTERLY FINANCIAL INFORMATION (UNAUDITED)

Summarized quarterly financial information for fiscal years 2018, 2017 and 2016 is as follows (in thousands, except per share data):



	Three Months Ended,									Year Ended,
Fiscal Year 2018	Nov 30, 2017		Feb 28, 2018			May 31, 2018		Aug 31, 2018		Aug 31, 2018
Total revenues	$	767,072	$	839,563		$	782,201	$	777,866	$	3,166,702
Total cost of goods sold	$	644,985	$	708,040		$	652,694	$	650,801	$	2,656,520
Net income attributable to PriceSmart, Inc.	$	22,490	$	14,148	(1)	$	18,694	$	18,996	$	74,328
Basic net income per share	$	0.74	$	0.47		$	0.61	$	0.62	$	2.44
Diluted net income per share	$	0.74	$	0.47		$	0.61	$	0.62	$	2.44



	Three Months Ended,								Year Ended,
Fiscal Year 2017	Nov 30, 2016		Feb 28, 2017		May 31, 2017		Aug 31, 2017		Aug 31, 2017
Total revenues	$	739,572	$	793,296	$	730,258	$	733,502	$	2,996,628
Total cost of goods sold	$	618,671	$	667,563	$	617,598	$	615,920	$	2,519,752
Net income attributable to PriceSmart, Inc.	$	24,869	$	27,219	$	18,838	$	19,798	$	90,724
Basic net income per share	$	0.82	$	0.90	$	0.62	$	0.64	$	2.98
Diluted net income per share	$	0.82	$	0.90	$	0.62	$	0.64	$	2.98



	Three Months Ended,								Year Ended,
Fiscal Year 2016	Nov 30, 2015		Feb 29, 2016		May 31, 2016		Aug 31, 2016		Aug 31, 2016
Total revenues	$	711,931	$	777,931	$	704,262	$	711,052	$	2,905,176
Total cost of goods sold	$	598,015	$	657,725	$	597,242	$	596,644	$	2,449,626
Net income attributable to PriceSmart, Inc.	$	23,672	$	25,942	$	16,837	$	22,272	$	88,723
Basic net income per share	$	0.78	$	0.85	$	0.55	$	0.74	$	2.92
Diluted net income per share	$	0.78	$	0.85	$	0.55	$	0.74	$	2.92

⁽¹⁾

In the second quarter of fiscal year 2018, the Company recorded its provisional tax estimate of $13.4 million as a result of the U.S. Tax Reform Transition Tax. The Company finalized its calculation of this Transition Tax in the fourth quarter of fiscal year 2018, reducing it to approximately $12.5 million.

Restatement

The Company is restating its previously issued Consolidated balance sheets and Consolidated statements of cash flows as of and for the three, six, and nine month interim periods of fiscal year 2018 ended November 30, 2017, February 28, 2018 and May 31, 2018, respectively, to reflect a revision in presentation of short-term investments within current assets. In the aforementioned financial statements, the Company presented certain Certificates of Deposit and similar time-based deposits with financial institutions (collectively referred to herein as “CDs”) with maturities greater than three months and up to one year as Cash and cash equivalents, when they should have been presented as Short-term investments. This misclassification did not impact Revenue, Operating income, Net income, Cash flows from operations, Total assets or Total current assets.

In the past, the Company has disclosed in Management’s Discussion & Analysis in previously filed 1934 Act filings a lack of availability of U.S. dollars in certain markets (U.S. dollar illiquidity), which impedes our ability to convert local currencies obtained through merchandise sales into U.S. dollars to settle the U.S. dollar liabilities associated with our imported products. Also, as the Company has previously disclosed in Management’s Discussion & Analysis in previously filed 1934 Act filings, during fiscal year 2017 and fiscal year 2018, the Company experienced this situation in Trinidad. Until the central bank in Trinidad makes more U.S. dollars available, this condition is likely to continue. In reaction to the situation in Trinidad, the Company began investing the excess Trinidad and Tobago (TT) dollars into Certificates of Deposit or similar time-based deposits with financial institutions (referred to collectively herein as “CDs”) with terms of three months or less, which the Company correctly presented as Cash and cash equivalents on the consolidated balance sheet. As the Company’s balance of TT dollars increased, the Company began investing in CDs with terms of four months and up to twelve months. During the first three quarters of fiscal year 2018, the Company presented these four to twelve month CDs as Cash and cash equivalents in its consolidated balance sheet. However, in accordance with generally accepted accounting principles, these four to twelve month CDs should have been presented as Short-term investments. The correction of the misclassification of these investments within the Total current assets section of the consolidated balance sheets also requires the Company to disclose in the Cash provided by (used in) investing activities section of the consolidated statements of cash flows the cash used in Investments in and Settlements of short-term investments.

The following tables summarize the impacts of these misclassifications on the consolidated balance sheets and statements of cash flows for the interim periods of fiscal year 2018 (amounts in thousands):


	November 30, 2017
Financial Statement Captions	As Previously Reported		Adjustment		As Restated
Cash and cash equivalents	$	129,183	$	(39,339)	$	89,844
Short-term and long-term restricted cash	$	3,359	$	—	$	3,359
Total cash and cash equivalents, and restricted cash as shown in the statement of cash flows	$	132,542	$	(39,339)	$	93,203

Short-term investments	$	—	$	39,339	$	39,339


	For the Three Months Ended November 30, 2017
Statement of Cash Flows Captions	As Previously Reported		Adjustment		As Restated
Net cash provided by (used in) operating activities	$	(10,163)	$	—	$	(10,163)

Investing Activities
Additions to property and equipment	$	(19,752)	$	—	$	(19,752)
Short-term investments		—		(39,339)		(39,339)
Proceeds from settlements of short-term investments		—		—		—
Proceeds from disposal of property and equipment		20		—		20
Net cash provided by (used in) investing activities	$	(19,732)	$	(39,339)	$	(59,071)

Net cash provided by (used in) financing activities	$	(5,296)	$	—	$	(5,296)
Effect of exchange rate changes on cash, cash equivalents, and restricted cash	$	2,021	$	—	$	2,021
Net increase (decrease) in cash, cash equivalents, and restricted cash	$	(33,170)	$	(39,339)	$	(72,509)
Cash, cash equivalents, and restricted cash at beginning of period	$	165,712	$	—	$	165,712
Cash, cash equivalents, and restricted cash at end of period	$	132,542	$	(39,339)	$	93,203


	February 28, 2018
Financial Statement Captions	As Previously Reported		Adjustment		As Restated
Cash and cash equivalents	$	152,132	$	(58,745)	$	93,387
Short-term and long-term restricted cash	$	3,479	$	—	$	3,479
Total cash and cash equivalents, and restricted cash as shown in the statement of cash flows	$	155,611	$	(58,745)	$	96,866

Short-term investments	$	—	$	58,745	$	58,745


	For the Six Months Ended February 28, 2018
Statement of Cash Flows Captions	As Previously Reported		Adjustment		As Restated
Net cash provided by (used in) operating activities	$	59,079	$	—	$	59,079

Investing Activities
Additions to property and equipment	$	(46,233)	$	—	$	(46,233)
Short-term investments		—		(66,388)		(66,388)
Proceeds from settlements of short-term investments		—		7,643		7,643
Proceeds from disposal of property and equipment		54		—		54
Net cash provided by (used in) investing activities	$	(46,179)	$	(58,745)	$	(104,924)
						—
Net cash provided by (used in) financing activities	$	(21,859)	$	—	$	(21,859)
Effect of exchange rate changes on cash, cash equivalents, and restricted cash	$	(1,142)	$	—	$	(1,142)
Net increase (decrease) in cash, cash equivalents, and restricted cash	$	(10,101)	$	(58,745)	$	(68,846)
Cash, cash equivalents, and restricted cash at beginning of period	$	165,712	$	—	$	165,712
Cash, cash equivalents, and restricted cash at end of period	$	155,611	$	(58,745)	$	96,866


	May 31, 2018
Financial Statement Captions	As Previously Reported		Adjustment		As Restated
Cash and cash equivalents	$	141,164	$	(53,890)	$	87,274
Short-term and long-term restricted cash	$	3,649	$	—	$	3,649
Total cash and cash equivalents, and restricted cash as shown in the statement of cash flows	$	144,813	$	(53,890)	$	90,923

Short-term investments	$	—	$	53,890	$	53,890


	For the Nine Months Ended May 31, 2018
Statement of Cash Flows Captions	As Previously Reported		Adjustment		As Restated
Net cash provided by (used in) operating activities	$	90,765	$	—	$	90,765

Investing Activities
Business acquisition, net of cash acquired	$	(23,895)	$	—	$	(23,895)
Additions to property and equipment		(74,788)		—		(74,788)
Short-term investments		—		(72,953)		(72,953)
Proceeds from settlements of short-term investments		—		19,063		19,063
Deposits for land purchase option agreements		300		—		300
Proceeds from disposal of property and equipment		93		—		93
Net cash provided by (used in) investing activities	$	(98,290)	$	(53,890)	$	(152,180)

Net cash provided by (used in) financing activities	$	(12,389)	$	—	$	(12,389)
Effect of exchange rate changes on cash and cash equivalents and restricted cash	$	(985)	$	—	$	(985)
Net increase (decrease) in cash, cash equivalents, and restricted cash	$	(20,899)	$	(53,890)	$	(74,789)
Cash, cash equivalents, and restricted cash at beginning of period	$	165,712	$	—	$	165,712
Cash, cash equivalents, and restricted cash at end of period	$	144,813	$	(53,890)	$	90,923