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BJ’s Wholesale Club Inc. stock rose 3.3% in premarket trade Thursday, after the company posted better-than-expected earnings for its fiscal fourth quarter.
The Marlborough, Mass.-based company had net income of $129.8 million, or 95 cents a share, for the quarter to Jan. 28, up from $107.6 million, or 78 cents a share, in the year-earlier period. Adjusted per-share earnings came to $1.00, ahead of the 88 cent FactSet consensus.
Sales rose 13.2% to $4.828 billion from $4.264 billion, also ahead of the $4.786 billion FactSet consensus. Same-store sales rose 9.8% to beat the 5.5% FactSet consensus.
Membership fee income rose 8% to $101.8 million, and the company had a record 90% tenured member renewal rate. Digital sales grew 22% and the company opened five new clubs since the end of the third quarter.
But costs were higher, with selling, general and administration expenses rising to $707 million from $630.5 million in the year-earlier period, driven by higher labor and occupancy costs due to new club and gas station openings, as well as the costs relating to a new club support center and investments that aim to drive strategic priorities.
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The company launched a co-branded credit card program with Capital One in February. The card offers up to 5% rewards on in-club earnings and up to 2% rewards on out-of-club earnings as well as up to 15 cents off per gallon at BJ’s Gas.
“We look ahead to fiscal 2023 with the understanding that there is still significant uncertainty in the macroeconomic backdrop as well as its influence on the U.S. consumer,” Chief Financial Officer Laura Felice said in a statement.
BJ’s is now expecting fiscal 2023 EPS to be about flat, while same-store sales are expected to rise 4% to 5% excluding gas sales. The current FactSet consensus is for EPS of $3.82, which compares with the $3.76 posted for 2022. The consensus for same-store sales is for growth of 2.7%.
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The company also provided longer-term guidance as part of an Investor Day, saying it expects same-store sales growth of low-to-mid single digit percent, excluding gas sales. It expects revenue growth of mid-single digits and EPS growth of high-single to low-double digit percent.
The stock has gained 22% in the last 12 months, while the S&P 500
SPX,
has fallen 6.7%.
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