BJ’s Wholesale Club (US:BJ)2025-03-14 20:15Operations and Membership - As of fiscal year end 2024, the company operates 250 warehouse clubs and 186 gas stations across 21 states[35]. - The company has over 7.5 million members, with annual membership fee income of $456.5 million for fiscal year 2024[36]. - The annual membership fee for Club Card increased from $55 to $60, and for Club+ from $110 to $120 effective January 1, 2025[36]. - BJ's has over 7.5 million paid memberships as of February 1, 2025, targeting price-sensitive customers with large household sizes[50]. - Club+ members accounted for 39% of total memberships and 50% of merchandise spend (excluding gas and membership fee income) in fiscal year 2024[53]. Sales and Merchandise - The company claims to provide members with savings of over 25% on a representative basket of manufacturer-branded groceries compared to supermarket competitors[24]. - Private label brands, Wellsley Farms and Berkley Jensen, account for approximately 26% of total net sales, excluding gasoline[36]. - In fiscal year 2024, perishables, grocery, and sundries constituted approximately 87% of merchandise sales, while general merchandise and services made up about 13%[51]. - The company limits its merchandise offerings to approximately 7,000 core active SKUs, significantly fewer than supermarkets and supercenters[44]. - BJ's private label products accounted for approximately 26% of total net sales, excluding gasoline, in fiscal year 2024[47]. Strategic Initiatives and Expansion - The company completed the acquisition of four distribution centers and a private transportation fleet from Burris Logistics on May 2, 2022[36]. - The company aims to achieve high sales volumes and efficient operations by purchasing directly from manufacturers and minimizing handling costs[41]. - The company operates in a market where warehouse clubs attract customers from various retail channels, offering lower prices than traditional retailers[37]. - The company has made significant investments in enhancing fresh offerings and new club openings, indicating a commitment to operational improvements[80]. - The company is focused on market expansion and strategic initiatives under the leadership of William C. Werner, executive vice president of strategy and development[81]. Financial Management and Debt - As of February 1, 2025, the total outstanding debt was $575.0 million, including $175.0 million under the ABL Revolving Facility and $400.0 million under the First Lien Term Loan at interest rates of 5.41% and 6.08% respectively[264]. - A 100 basis point change in prevailing market rates would result in an annual interest cost change of approximately $5.8 million[264]. - The company is exposed to interest rate risk, with substantially all borrowings carrying variable interest rates, which may impact net interest expense and cash flow from operations[263]. - The company aims to limit the impact of interest rate changes on earnings and cash flows, reflecting a proactive financial management strategy[263]. - The company may utilize interest rate caps and/or swap agreements in the future to manage interest rate risks associated with variable rate debt[263]. Leadership and Workforce - The executive team includes Robert W. Eddy as chairman and CEO, Laura L. Felice as CFO, and Paul Cichocki as chief commercial officer, among others, indicating a strong leadership structure[78][79][80][81]. - The company has expanded its executive team with Anjana Harve as chief information officer, effective September 2023, enhancing its IT leadership[79]. - The leadership team has extensive experience in retail and consumer products, which supports the company's strategic objectives and operational effectiveness[78][79][80][81]. - The company employs over 33,000 full-time and part-time team members as of February 1, 2025, with no union representation[69]. Community Engagement - BJ's Charitable Foundation has awarded over $37 million to nonprofit organizations since its inception in 2004, supporting community initiatives[74].