In the third quarter, BJ’s earnings beat a Wall Street estimate and comparable store sales advanced as the general merchandise business stabilized.
The company pointed out that its membership fees would increase at the start of 2025.
Net income in the quarter was $155.7 million, or $1.17 per diluted share, versus $130.5 million, or 97 cents per diluted share, in the year-before period. Adjusted for one-time events, net income was $157.3 million, or $1.18 per diluted share, versus $135.5 million, or $1 per diluted share, in the year-previous period. Although revenue fell short of a Zacks Investment Research estimate of $5.13 billion, earnings beat the firm’s forecast of 91 cents per adjusted diluted share.
Comparable club sales, with gasoline sales excluded, increased by 3.8% year-over-year in the quarter, led by strong traffic, the company noted. BJ’s indicated that an increase in sales, temporarily driven by the recent port strike and hurricanes, had a favorable impact of slightly less than one percentage point on third-quarter comps excluding gasoline.
Net sales grew to $4.98 billion while total revenue advanced to $5.1 billion from $4.82 billion and $4.92 billion, respectively, in the year-earlier quarter, the company noted. Operating income was $229.4 million versus $199.4 million in the year-prior period. Digitally enabled comps gained 30%. Membership fee income grew by 8.4% year-over-year to $115 million.
In a conference call, Bob Eddy, BJ’s chairman and CEO, said the company would increase its basic membership fee by $5 to $60 and the Plus membership by $10 to $120 on January 1, 2025. General merchandise comps were flat in the quarter year over year, but Eddy said the company is making progress in the GM business..
“Our assortment and presentation in our home and apparel categories are improving each quarter. Notably, our seasonal GM categories delivered positive comps in the third quarter for the first time in nine quarters.”
He added, “Our nimble teams adapted our localization strategies to take advantage of an unseasonably warmer fall season and capture opportunistic sales in grilling, producing low double digit comps in the category.”
In announcing the financial results, Eddy said, “Our third quarter results demonstrate the combination of great value and strong execution. We delivered robust membership growth and hit a milestone of 7.5 million members. Our value proposition continues to resonate in new and existing markets..”
