Shares of BJ's Wholesale Club (BJ 0.06%) jumped 7.4% on Thursday as investors cheered the discount warehouse chain's impressive revenue and profit growth.
The retailer's net sales rose 16.3% year over year to $4.4 billion in its fiscal 2022 first quarter, which ended on April 30. The gains were fueled by a 14.4% jump in total comparable-club sales. Excluding gasoline sales, BJ's comps grew by 4.1%.
The warehouse club's membership count rose to 6.5 million as BJ's value-priced offerings proved popular with cash-strapped consumers. The company's membership fee income, in turn, climbed 11.9% to $96.6 million.
"Gains in member traffic underscored the value we provide," CEO Bob Eddy said in a press release. "Our business model remains more relevant than ever in the current inflationary environment."
BJ's is also doing an admirable job of managing inflationary cost pressures. Higher freight costs led to a relatively modest 30 basis point (1 basis point is equal to 0.01%) decline in its merchandise gross margin.
This disciplined cost containment combined with BJ's sales growth helped to drive its operating income 19.1% higher to $150.3 million. Its adjusted earnings per share, which were boosted by stock buybacks, increased 20.8%, to $0.87.
Importantly, BJ's e-commerce operations are also growing at a solid clip. Its digitally enabled sales surged 26% in Q1. The company is investing in its logistics network to further strengthen its online initiatives. BJ's acquired four refrigerated distribution centers in January to gain more control over its perishable supply chain.
"Our digital business remains a key competitive advantage," Eddy said. "We're quickly expanding our footprint and we recently closed the acquisition of our perishable distribution network, which will support our future growth efforts and drive long-term shareholder value."