NEW YORK (Reuters) - BJ’s Wholesale Club Inc BJ.N, the No. 3 U.S. warehouse club operator, on Wednesday reported a 26 percent jump in quarterly profit, beating Wall Street expectations, as shoppers headed to its stores for discounts on food and fuel.
The retailer also boosted its full-year earnings forecast.
BJ’s said profit for its fiscal first-quarter, ended May 3, rose to $17.2 million, or 29 cents per share, from $13.7 million, or 21 cents per share, a year earlier.
Analysts, on average, expected 28 cents per share, according to Reuters Estimates.
Net sales, which exclude membership fee revenue, rose 12.3 percent to $2.26 billion. Sales at clubs open at least a year, a key retail gauge known as comparable club sales, jumped 9.6 percent, including a 3.9 percent boost from sales of gasoline.
Membership fees and other revenue rose to $47.5 million from $46.9 million.
Shoppers pay an annual fee to shop at warehouse clubs like BJ‘s, Costco Wholesale Corp (COST.O) and Wal-Mart Stores Inc’s (WMT.N) Sam’s Club to get discounts on everything from fresh food to TVs to bulk-sized packages of paper towels.
Many warehouse club locations also operate gas stations, which typically sell cheaper fuel than do local competitors.
BJ’s has been working to turn around its business after facing disappointing sales and fewer customers coming to its club. Its business is starting to improve at the same time the U.S. economy is faltering, and shoppers are looking for ways to save money on everyday purchases, like food and gasoline.
As of February 2, BJ’s operated 100 gasoline stations at its clubs, according to a recent regulatory filing.
BJ’s now expects full-year earnings of $2.04 to $2.14 per share, up from its previous view of $1.98 to $2.08 per share.
Reporting by Nicole Maestri; Editing by Derek Caney and Steve Orlofsky