BJ’s Q4 Performance Contributes to Record Year
BJ’s Wholesale Club Holdings Inc. has reported fourth-quarter comps and profits that were higher than anticipated, contributing to another milestone year.
For the quarter ended Feb. 1, comparable-club sales increased by 4.0% year over year, while comparable-club sales excluding gas sales grew by 4.6%. This was led by traffic, which contributed more than three percentage points to comps in the quarter. It was the 12th consecutive quarter of traffic growth for the company.
Membership fee income jumped by 7.9% in Q4 to $117.0 million. During fiscal year 2024, BJ’s reported another record membership year, with full-year membership fee income increasing by 8.5% and renewal rate remaining strong at 90%. Merchandising initiatives and digital conveniences drove greater member engagement, according to BJ’s.
Perishables, grocery and the sundries division delivered more than 4% comp growth in the Q4, with perishables leading the way. “Our strength in perishables has been a recurring theme all year as more members make us their weekly destination for quality essentials such as produce, dairy and meat,” said Bob Eddy, BJ's chairman and CEO, during the company's quarterly earnings call.
[RELATED: BJ’s Commits to Growing Fresh Business]
“Our fresh initiatives have sparked meaningful produce demand since the full rollout in the second quarter,” explained Eddy. “Our efforts have boosted our credibility in fresh, exhibited by our double-digit produce comps in each of the past three quarters. In fiscal 2024, our fresh business grew at a rate that was 10 percentage points greater than the rest of the market. While our performance in produce alone validates our work, we are especially encouraged by the positive ripple effects on overall member behavior. Early indications since launching Fresh 2.0 show that tenured members who are completely new to buying fresh produce at BJ’s are making more trips and on average shopping across four more categories than they have in the past.”
The club retailer is also performing well in digital conveniences. In Q4, digitally enabled comparable-sales growth was 26.0%, reflecting two-year stacked comp growth of 53.0%
“Today, about 60% of members engage with us digitally in some shape or form," noted Eddy.
“Our terrific fourth-quarter performance contributed to a record year at BJ’s, powered by all-time-high membership results," he added. "Our improved assortment, investments in value and significant growth in digital sales drove our 12th consecutive quarter of traffic growth."
Additionally, while gross profit decreased to $949.0 million in Q4, from last year's $963.3 million, due primarily to the impact of the 53rd week in fiscal 2023, the gross profit increased in FY2024 to $3.76 billion, from $3.64 billion in FY2023.
Also in FY2024, gross profit increased to $3.76 billion, from $3.64 billion in FY2023, while net income grew to $534.4 million in FY2024, compared with $523.7 million in FY2023.
Adjusted EBITDA increased by 0.8% to $1.09 billion in FY2024, versus last year’s $1.08 billion.
BJ’s opened seven new clubs and 12 gas stations in its latest fiscal year and is planning to grow its footprint. The membership warehouse operator has said that it will expand into Texas as part of a plan to add 25-30 new clubs over its next two fiscal years.
“As we look to fiscal 2025, we believe our continued focus on our strategic priorities and commitment to delivering great value will drive strong results for our business,” observed Laura Felice, BJ’s EVP and CFO. “We also recognize the macro-driven uncertainties in the operating environment, and as such, remain cautiously optimistic about the year.”
The company provided the following guidance for FY2025:
- Comparable-club sales, excluding the impact of gasoline sales, to increase 2.0% to 3.5% year-over-year
- Adjusted EPS to range from $4.10 to $4.30
- Capital expenditures of approximately $800 million, driven by a growing pipeline of future clubs, including the construction of the company’s recently revealed ambient distribution center in Ohio.
Marlborough, Mass.-based BJ’s currently operates more than 250 clubs and 188 BJ’s Gas locations in 21 states. The company is No. 30 on The PG 100, Progressive Grocer’s 2024 list of the top food and consumables retailers in North America.
