BJ's Wholesale Club Holdings, Inc. has recently released its 10-Q report, providing an in-depth look at the company's financial performance for the first quarter of fiscal year 2025. BJ's Wholesale Club operates membership warehouse clubs on the eastern half of the United States, offering groceries, fresh food, general merchandise, gasoline, and other ancillary services through its clubs, website, and mobile app. The company's net sales for the first quarter of fiscal year 2025 were $5.0 billion, marking a 4.7% increase from the same period in fiscal year 2024.
Comparable club sales, a key performance indicator, increased by 1.6% for the first quarter of fiscal year 2025, with merchandise comparable club sales growing by 3.9%. The increase in net sales was primarily driven by traffic and unit growth, particularly in the perishables, grocery, and sundries division. Membership fee income also saw a notable 8.1% increase, reaching $120.4 million in the first quarter of fiscal year 2025.
Cost of sales for the first quarter of fiscal year 2025 was $4.2 billion, representing 83.1% of net sales, with the merchandise gross margin rate increasing by 30 basis points compared to the prior year period. Selling, general, and administrative expenses (SG&A) increased by 5.4% to $760.9 million in the first quarter of fiscal year 2025, primarily driven by increased labor and occupancy costs due to new club and gas station openings.
Pre-opening expenses for new clubs and distribution centers were $5.0 million in the first quarter of fiscal year 2025, compared to $0.9 million in the same period of fiscal year 2024. Interest expense, net decreased to $11.1 million in the first quarter of fiscal year 2025 from $14.0 million in the first quarter of fiscal year 2024.
The company's adjusted net income for the first quarter of fiscal year 2025 was $150.9 million, with adjusted earnings per diluted share (EPS) reaching $1.14. Adjusted EBITDA for the same period was $285.8 million, highlighting the company's core operating performance.
BJ's Wholesale Club's primary sources of liquidity are cash flows generated from club operations and borrowings from its ABL Revolving Facility. As of May 3, 2025, the company had cash and cash equivalents totaling $39.5 million and $1.0 billion of unused capacity under its ABL Revolving Facility. Net cash provided by operating activities for the first three months of fiscal year 2025 was $208.1 million, with net cash used in investing activities amounting to $142.3 million and net cash used in financing activities totaling $54.6 million. The market has reacted to these announcements by moving the company's shares -0.88% to a price of $111.04. Check out the company's full 10-Q submission here.
