On the heels of a record first quarter, BJ’s Wholesale Club’s sales slid during the second quarter, the club-based retailer said Tuesday in reporting earnings for the period ended July 29.
Total comparable club sales dipped by 5.3% during the quarter compared to the year before. However, the membership-based warehouse retailer reported comparable club sales, excluding gas, edged up 1.1% year over year.
Profits were also down for the second quarter compared to prior year as BJ’s reported net income of $131.3 million compared to $141 million. Adjusted EBITDA decreased by 1.8% to $268.8 million in the second quarter of fiscal 2023 compared to $273.7 million in the second quarter of fiscal 2022.
On the upside, the membership-based warehouse retailer again achieved high member renewal rate, in reporting its second-quarter earnings.
Membership fee income for the second quarter increased by 5% year over year to $103.7 million. Digital sales rose 15% from the year before.
“Our strong performance in the second quarter reflects our continued gains in membership, traffic and market share, driven by the great value that we provide our members every day,” said Chairman and CEO Bob Eddy in a statement. “We continue to balance gross margins with investments in value and in growing the size and quality of our membership with an eye toward the future. I’m proud of the team’s execution in the quarter and believe that we are well-positioned for continued growth.”
With a focus on value, the Marlborough, Massachusetts-based wholesale club said it remains committed to its traffic and market share gains.
“We continue to navigate shifts in consumer behavior driven by the broader macroeconomic environment. As a result, we are refining our outlook for the rest of the fiscal year,” said EVP and CFO Laura Felice in a statement.
Felice said BJ’s expects comparable store sales, excluding the impact of gasoline sales, to increase approximately 2% year over year. with adjusted EPS to be in the $3.80 to $3.92 range for fiscal 2023.
During the second quarter, the retailer opened one new club and one new gas station. Store count growth is also expected for the third quarter as Eddy said on the earnings call “our team will be busy with anticipated openings later this year as we enter our 20th state in Madison, Alabama.”
BJ’s currently operates 238 clubs and 168 gas locations in 19 states.