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NATICK, Mass. -- BJ's Wholesale Club, Inc. yesterday posted net income of $18.6 million, or 27 cents per diluted share, for its first quarter ended April 30, 2005, vs. net income of $16.1 million, or 23 cents per diluted share, for the year-ago period.
Net sales for the first quarter went up 9.8 percent to $1.8 billion, and comparable-club sales rose 5.8 percent, including a contribution from gasoline sales of 70 basis points.
In a statement president and c.e.o. Mike Wedge noted: "We are pleased with our first-quarter results, which reflect the outstanding efforts of BJ's team members. We delivered a healthy 5.8 percent comp sales increase, exceeded our merchandise margin expectations, and continued to drive down product cost through our global sourcing and e-sourcing initiatives. Our business fundamentals, together with Member Insight and our real estate initiatives, give us confidence regarding BJ's long-term growth."
The company further said that it repurchased about 1.2 million shares of BJ's common stock during the first quarter at an average cost of $28.84 per share, for a total of about $33.6 million.
Results for the first quarter also included $2.9 million of post-tax income ($4.3 million pretax) from a recovery of certain claims connected with the House2Home bankruptcy, and $1.8 million of post-tax expense ($3 million pre-tax) to boost the company's reserve for claims by various credit card-issuing banks. The net total of these two items was $1.1 million, or two cents per diluted share of income, which wasn't included in the company's first-quarter earnings guidance of 22 cents to 25 cents per diluted share. The charge to increase BJ's credit card reserve was mainly because of a rise in the retailer's estimate of legal expenses to be incurred. "BJ's is vigorously contesting all claims and will continue to explore all possible defenses and all possible claims against others," the company said.
BJ's currently operates 156 BJ's clubs and 81 gas stations, compared with 150 clubs and 78 gas stations at the end of last year's first quarter. The company additionally operates two ProFoods Restaurant Supply Clubs in the Metro New York market.