BJ's records 'the most profitable third quarter in our history'

BJ’s Wholesale Club made history with its third-quarter profits as same-store sales increased 9.7% year-over-year, prompting President and CEO Bob Eddy to tell analysts on Thursday’s earnings call with investors that “this was the most profitable third quarter in our history.”

BJ's Wholesale Club reported fiscal third-quarter net income of $129.9 million, despite ongoing challenges with inflation. Growth continued across several segments for the third quarter as same-store sales increased by 5.3%, and membership fee income increased by 8.7% year-over-year, to $99.5 million, BJ’s reported.

With a focus on value, the Marlborough, Massachusetts-based wholesale club saw significant omnichannel growth, as digitally enabled sales growth was 43% year-over-year.

“We reported another quarter of strong results, demonstrating the power of our business model,” Eddy said. “Food categories continue to anchor our strength with comps increasing double digits over last year’s performance."

Other fiscal highlights for the third quarter include earnings per diluted share of 95 cents, reflecting a 3.3% year-over-year increase and adjusted earnings per diluted share of 99 cents, reflecting a 8.8% year-over-year increase, the company reported. Cash from operating activities was $173.1 million and free cash flow was $78.7 million for the third quarter.

Continuing its footprint expansion, the company opened three new clubs in the third quarter.

“The clubs we have opened in the past several years continue to perform better than our initial plans, giving us the confidence to sustain four to five percent unit growth in the foreseeable future,” Eddy told analysts on the earnings call.

As a result of a strong third quarter performance, the company has raised its outlook for the remainder of fiscal 2022.

“We are optimistic about the outlook on our business given the sustained strength in our grocery business and our gains in market share,” said Laura Felice, EVP and CFO of BJ's Wholesale Club, in a statement. “We now expect fiscal year 2022 comparable club sales growth, excluding the impact of gasoline sales, to be in the 5.0% to 5.5% range. While we expect continued merchandise margin rate pressure, we also now expect fiscal year 2022 EPS to be in the $3.70 to $3.80 range. We remain confident that the strength of our core business and our intense focus on delivering value will continue to drive long-term growth.”

BJ’s Wholesale Club will open its 24th New Jersey location in Wayne on Friday, bringing the retailer's store count to 234 nationwide.