Costco Profit Rises 35% on Tax Gain; Shares Fall

Costco Wholesale Corp., the largest U.S. warehouse-club retailer, said fiscal second-quarter profit rose 35% on a tax gain and lower healthcare costs. The company’s sales growth slowed, and its shares fell 3.6%, the biggest drop in 19 months.

Net income climbed to $305.5 million, or 62 cents a share, in the quarter ended Feb. 13 from $226.8 million, or 48 cents, a year earlier. Revenue, including membership fees, increased 9.6%, compared with 14% a year earlier, the Issaquah, Wash.-based company said.

Shares of Costco fell $1.69 to $45.02 on Nasdaq.

* Neiman Marcus Group Inc., operator of 37 luxury department stores, said fiscal second-quarter profit climbed 19% to $70.6 million, or $1.43 a share, from $59.2 million, or $1.21, a year earlier. Sales rose 8% to $1.13 billion in the quarter ended Jan. 29.