The third quarter saw earnings slip despite a comparable sales gain for BJ’s Wholesale Club as the company continues effort to improve its general merchandise performance.
Net income was $152.1 million, or $1.15 per diluted share, versus $155.7 million, or $1.17 per diluted share, in the year-before quarter, the company stated. Adjusted for one-time events, net income was $153.1 million, or $1.16 per diluted share, versus $157.3 million, or $1.18 per diluted share, in the year-previous period.
A MarketBeat-published analyst consensus estimate was for adjusted diluted earnings per share of $1.09 and revenues of $5.35 billion.
Comparable club sales, excluding the impact of gasoline, increased by 1.8% year-over-year. In a conference call, Bob Eddy, BJ’s chairman and CEO, said the company’s general merchandise and services business comps also gained 1.8%. BJ’s is managing general merchandise inventory tightly in the face of uncertainty about costs, especially given the volatile tariff situation in the United States. The general merchandise inventory decision is part of a strategy to manage as a means of funding markdowns in select categories and, with that, provide more value for members across the operation, according to BJ’s.
Net sales were $5.22 billion while total revenue was $5.35 billion versus $5 billion and $5.1 billion, respectively, in the year-prior quarter. Operating income was $218.4 million versus $229.4 million in the year-earlier period.
BJ’s updated its guidance for full-year comp sales to up 2% to 3% without fuel impact versus the previous year and adjusted earnings per share in a range of $4.30 to $4.40. Guidance for comps without fuel impact had been for an increase of 2% to 3.5% from the year past with adjusted diluted EPS in the $4.20 to $4.35 range.
In the conference call, Eddy added that although general merchandise has advanced, BJ’s still has work to do in its home and seasonal businesses, “which continue to be impacted by lower discretionary demand and consumer confidence.”
Beyond the Texas and Alabama debuts, Eddy noted, BJ’s also has slated club openings for Springfield, MA, Sumter, SC, Chattanooga, TN, Selma, NC, and Castleberry and Delray, FL.
In announcing the financial results, Eddy said, “Our business continues to perform well in a volatile environment, and we are maintaining an unwavering focus on what matters most, taking care of families who depend on us. We are confident that we can be the destination for value and convenience, and we are entering the holiday season with momentum.”
