Costco, BJ's benefit from gas and food sales
NEW YORK (Reuters) - Costco Wholesale Corp (COST.O) and BJ's Wholesale Club Inc (BJ.N) on Thursday reported strong June sales as gas prices and food sales boosted results at the warehouse club operators.
Costco, the No 1 U.S. warehouse club operator, posted a 9 percent rise in June sales at stores open a least a year, or comparable-club sales, while BJ's, the No 3 U.S. warehouse club operator, had a 16.5 percent sales increase on that basis.
Comparable-club sales at No. 2 U.S. warehouse club Sam's Club, a division of Wal-Mart Stores Inc (WMT.N), rose 8.3 percent, including fuel sales.
Ken Perkins, president of Retail Metrics, said in a note that shoppers were looking for bargains to offset the "painful affects" of record gas and food prices.
He said Costco's 9 percent June comparable-club sales were "very impressive given the current retail backdrop."
Customers pay an annual fee to shop at warehouse clubs and they get discounts on everything from cameras to bulk-sized packages of paper towels. The clubs have also increased the selection of fresh and prepared food.
Many warehouse locations also operate gasoline stations where less expensive fuel is sold, which helps to bring customers into the clubs.
Costco's comparable-club sales at its U.S. locations rose 9 percent. About 4 percentage points of that came from higher gas prices, with an average price per gallon of $4.03 in June, up from $2.93 a gallon last year, the company said.
Excluding gas sales, BJ's said its comparable club sales rose 8.3 percent, while Sam's Club's sales rose 4.6 percent excluding fuel.
SMALL BUSINESSES ALSO BENEFIT
Sam's Club chief executive officer Doug McMillon said in a statement that its small business shoppers were "especially price conscious" in this environment. And he said sales at Sam's Club were still shifting toward fuel, food and consumable items, like household cleaners.
BJ's said comparable-store sales of food in June rose roughly 11 percent, driven by strong demand for perishable goods, while Costco said its food business had a high-single-digit rise in comparable store sales.
"We are, of course, benefiting from some inflation on the food side as a result of recent run up in costs of commodities and the continued run-up in cost of oil and gasoline," Costco said on a recorded call.
Costco said sales were weaker in the month for televisions and computers, while BJ's said electronics, jewelry, and televisions were among its weaker departments.
Costco's total sales for the five weeks ended July 6 rose 12 percent to $7.14 billion. Its international division comparable store sales rose 11 percent, but on a local currency basis, it said those sales were up 8 percent.
BJ's total sales for the five weeks ended July 5 rose to $1.05 billion from $887 million, while Sam's Club total sales rose for the five weeks ended July 4 rose to $4.81 billion from $4.42 billion
(Reporting by Nicole Maestri; Editing by Toni Reinhold)
