BJ's Sees 'Remarkable' Q3 Performance
With robust same-store sales growth, significant market share gains and record profitability, it's no wonder that BJ’s Wholesale Club CEO Lee Delaney called the company’s third-quarter performance "remarkable."
Same-store sales, excluding fuel, increased 18.5% and digitally enabled sales increased 200% during the third quarter ended Oct. 31, compared with the prior year. Both figures are a deceleration from the second quarter when BJ’s reported a 24.2% comp increase and digitally enabled sales growth of more than 300%. Conversely, there was a slight acceleration in membership fee income, which advanced 11% to $85 million, compared with the prior year, whereas in the second quarter, membership income increased 10.4%.
Not reflected in BJ’s third-quarter performance is the impact of the addition of fresh and frozen grocery items, which were added to the company’s click-and-collect offering just days before the end of the third-quarter reporting period.
“As we look ahead, we are confident our business will continue to thrive, given the structural shift in consumer behavior, our market share gains and our strategic investments in digital capabilities, membership, assortment, marketing and geographic expansion," said Delaney. "Our team members across our business are working hard to execute at the highest standards and meet our members’ increased demand for our products and services. We remain grateful for their continued dedication and hard work in helping us drive industry-leading results."
In addition to the 18.5% comp increase, BJ's said that total sales increased 15.7% to $3.6 billion.The top-line growth, combined with membership fee income, enabled the company to grow net income $123% to $122.8 million.
In the fourth quarter, the company is likely to see the impact of fresh and frozen categories on its digital business, since products in those categories became eligible for pickup on Oct. 29.
“With the expansion of our buy online, pick up in-club service, BJ’s members can do their weekly grocery shopping – and check off anything else on their list – in an easy, one-stop shop,” said Jeff Desroches, BJ's EVP and club operations officer, when the service expansion was revealed.
Westborough, Massachusetts-based BJ's Wholesale Club operates 219 clubs and 148 BJ's Gas locations in 17 states. The company is No. 27 on The PG 100, Progressive Grocer's 2020 list of the top food and consumables retailers in North America.
