The fiscal third-quarter earnings of the warehouse and discount retailer Costco Wholesale Corp plunged 29 percent, chiefly because of lower revenue, a $34 million litigation payment, and increased staff-benefit costs.

Figuratively speaking, the period that ended May 10, 2009, saw Costco post an income of $209.6 million, as compared to the earlier year figures of $295.1 million. The company’s year-on-year revenue dropped 4.8 percent from $16.26 billion to $15.48 billion; with overall same-store sales falling 7 percent.

Though retailers like Costco – which largely sell big packages of household goods - have fared comparatively better than other retailers, the company has still not been spared by the blows of the weakened economy. Falling gas prices and stronger dollar have adversely affected the company’s revenues.

The retailer said that it booked lower international profit because of the noteworthy strengthening of the US dollar; and added that it experienced overall “ongoing weakness in sales, particularly sales of higher-ticket, discretionary items.” With its sales slipping, the company plans to keep its prices low to win market share, even though that would reduce profits.

In a statement last month, Costco mentioned its intentions of shuttering its two Costco Home stores - which sold home furnishings to the Costco members - this summer, due to the generally weak furniture sales.