BJ's Wholesale Q4 Results Top Estimates

Retailer BJ’s Wholesale Club Holdings, Inc. (BJ) announced Thursday that profit for the fourth quarter increased 20.7 percent from last year, driven by improved gross margins and 13.1 percent revenue growth. Adjusted earnings per share and quarterly revenues topped analysts’ estimates. The company also initiated earnings guidance for the full-year 2023, below estimates.

In pre-market trading on the NYSE, BJ’s Wholesale is up $3.19 or 4.29 percent to $77.50.

For the fourth quarter, net income grew to $129.78 million or $0.95 per share from $107.57 million or $0.78 per share in the prior-year quarter.

Excluding items, adjusted net income was $136.69 million or $1.00 per share, compared to $109.91 million or $0.80 per share in the year-ago quarter.

On average, analysts polled by Thomson Reuters expected the company to report earnings of $0.87 per share for the quarter. Analysts’ estimates typically exclude special items.

Total revenues for the quarter increased 13.1 percent to $4.93 billion from $4.36 billion in the same quarter last year. Analysts expected revenues of $4.80 billion for the quarter.

Net sales grew 13.2 percent to $4.83 billion and membership fee income increased 8.0 percent to $101.83 million from last year. Digitally-enabled sales growth was 22 percent.

Total comparable club sales increased 9.8 percent and comparable club sales, excluding the impact of gasoline sales, grew 8.7 percent. The Company also achieved a record 90 percent tenured member renewal rate.

Merchandise gross margin rate, which excludes gasoline sales and membership fee income, increased 30 basis points over the fourth quarter of fiscal 2021, driven by improved inventory management.

The Company successfully launched its co-brand credit card program with Capital One and Mastercard in late February, officially naming it the BJ’s One Mastercard program. The program will provide a first-class rewards and customer service experience, delivering more value back to its members.

The program will offer up to 5 percent rewards on in-club earnings and up to 2 percent rewards on out-of-club earnings as well as up to 15 cents off/gallon at BJ’s Gas.

Looking ahead to fiscal 2023, BJ’s expects earnings per share to remain approximately flat year-over-year, including the 53rd week benefit of low-teens cents per share, implying earnings of about $3.76 per share. Comparable club sales, excluding the impact of gasoline sales, are expected to increase 4 to 5 percent.

The Street is looking for earnings of $3.85 per share on revenues of $20.53 billion for the year.

Over the long term, the company projects earnings per share growth in the high-single to low-double digit percent, total revenue growth in the mid-single digit percent, and comparable club sales growth in the low-to-mid single digit percent, excluding the impact of gasoline sales.

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