BJ’s Wholesale Club, Inc. (BJ), a leading warehouse club operator in the United States, recently reported better-than-expected first-quarter 2010 results. The quarterly earnings of 49 cents a share, surpassed the Zacks Consensus Estimate of 43 cents, and climbed 8.9% from 45 cents delivered in the prior-year quarter.
The stronger-than-expected results prompted management to lift the earnings guidance. Management now expects earnings between $2.58 and $2.68 per share, up from the previous guidance range of $2.54 and $2.64 for fiscal year 2010. The current Zacks Consensus Estimate for fiscal 2010 is $2.62.
Total revenue, which includes net sales, membership fees and other revenue, jumped 12.7% to $2,608.1 million from the prior-year quarter. Net sales for the quarter rose 12.9% to $2,549 million, membership fee income climbed 5.8% to $47 million and other revenue jumped 10.8% to $12.2 million.
Comparable club sales for first-quarter 2010 climbed 7.8%, including a positive impact of 3.6% from gasoline sales. Merchandise comparable club sales for the quarter increased by 4.2%, excluding gasoline sales. Management now expects second quarter merchandise comp sales between 4% and 6%.
BJ’s Wholesale Club experienced a 6% rise in comparable sales of food, whereas sales of general merchandise rose by 1%.
The company ended the quarter with cash and cash equivalents of $63.6 million, total long-term debt of $1 million and shareholders equity of $1,065.1 million. In fiscal 2010, management plans capital expenditures between $215 million and $235 million.
BJ’s Wholesale Club repurchased 272,800 shares during the quarter at an average cost of $33.69, aggregating $9.2 million. As of May 1, 2010, the company had approximately $272 million at its disposal under the existing Board authorization for repurchase.
BJ’s Wholesale Club currently operates 188 clubs in 15 states.
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