BJ Wholesale Club : Investor Presentation November 2024

Published: 2024-11-21 07:12:06 ET BJ

BJ's Wholesale Club Investor Presentation

November 2024

Q3 FY24: Strong execution and great value drives momentum in traffic and membership, including milestone of 7.5 million members

A stronger company today, built on our strategic priorities

Q3 FY24 results

Improve member loyalty

7.5M Members

$115.0 M

MFI1 +8.4% vs. Q3 FY23

90%

Tenured renewal rate2

39%

Higher-tier penetration

Co-brand partnership with Capital One enhances value proposition

Unbeatable

Deliver

member

value

experience

conveniently

Focus on value continues to resonate in current environment demonstrated by growth in traffic, units sold and market share

+30%

Digitally-enabled comparable sales growth

90%+

Digital sales fulfilled in-club

25.5%

Own brand penetration2

Grow our footprint

Opened 3 new clubs and 4 new gas stations in Q3 FY24

Currently operates 247 clubs and 182 gas stations

Company expects to operate more than 250 clubs by fiscal year end 2024

$5.0B

Net sales +3.4% vs. Q3 FY23

+3.8%

Comparable club sales ex. the impact of gasoline vs. Q3 FY23

+20bps

Merchandise gross margin rate vs. Q3 FY23

$308.3M

Adjusted EBITDA3 +13.5% vs. Q3 FY23

$1.18

Adjusted EPS3 +18.0% vs. Q3 FY23

Strong balance sheet and free cash

• Capital allocation priority remains investing in the business

• Net debt to LTM adjusted EBITDA3 of 0.5x

flow provide strategic flexibility

•

Returned $129.3M to shareholders via share repurchases (YTD Q3 FY24)

•

Announced new $1 billion share repurchase program

$201.4M

Free cash flow3

Key investment highlights

Advantaged

business model in a favorable market backdrop

Loyal membership

base that is

growing in size and

quality

Differentiated

shopping

experience focused

on fresh, value

and convenience

Accelerated

expansion of

highly profitable

club base

Prudent capital

allocation strategy

maximizes

shareholder value

The warehouse club model offers significant structural advantages

Operate efficiently

Constantly reinvest into value

Earn member loyalty, stability and data

1 25% savings based on a representative basket of manufacturer-branded groceries compared to traditional supermarket competitors. For additional information, refer to our Form 10-K filed with the SEC on March 18, 2024

The warehouse club channel is growing and taking share

U.S. warehouse club market size1

($ in B)

$108

$113

$121

$132

$141

$147

$151

$152

$155

$165

$176

$183

$204

$236

$269

$278

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

2023

Accelerated share gains in recent years with opportunity for future growth1

U.S. sales growth by channel

2023 share of

(2018 - 2023 CAGR)

U.S. retail sales

9.5%

4.8%

6.7%

5.7%

3.6%

U.S. warehouse club market

Warehouse Total retail Grocery

GAFO 2

club

Source: HHC Publishing - 2023 Warehouse Club Focus; U.S. Census Bureau data (seasonally adjusted)

GAFO represents stores that specialize in merchandise including furniture & home furnishings, electronics & appliances, computers, clothing & accessories, sporting goods, hobby, book, music, general merchandise, and office supplies

MFI has grown every year for over 25 years

($ in M)

$448

$421

$397

$361

$333

$283

$302

$229

$242

$243

$247

$255

$259

$210

$139

$150

$159

$173

$175

$180

$191

$118

$124

$106

$56 $66 $79 $90

FY97 FY98 FY99 FY00 FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 LTM

StoreFY24 count

107

118

130

140

150

157

165

172

177

180

187

189

195

198

201

207

213

214

215

216

217

221

226

235

243

247

Renewal

81%

83%

84%

82%

83%

84%

83%

83% 82% 82%

83%

82%

84%

83%

83% 84% 85%

86%

87% 87%

88%

89%

90%

rate1

MEMBERSHIP FEE

INCREASE

1 Represents tenured renewal rate which is reported annually

BJ's go-to-market strategy is differentiated

vs. Club

vs. Grocery

vs. Mass channel

Broader assortment

Smaller pack sizes

Smaller club format

Convenient locations

Full-service deli

~25% lower prices1

Treasure hunt

Services & fuel

Price below mass channel break-even

Larger pack sizes

We strive to deliver a great member experience grounded in value

How members save at BJ's

Lower prices

Fresh food and deli assortment can fulfill weekly grocery shopping needs

Quality own brand products

Digital app allows for convenient shopping and coupon usage

Low-priced fuel and services

Illustrative member savings1

~10x

Return on

membership

fee

EDLP savings

Coupons

Own brands

Gas savings

Higher-tier membership rewards

Attractive credit card rewards

1 Estimate of average annual member savings. Assumes Every Day Low Price ("EDLP") savings versus traditional grocery

Our goal is to deliver convenience to our members

Digitally-enabled sales

BOPIC1 / Curbside pickup

Same-day delivery ("SDD")

Ship-to-home,

Express Pay, other2

In-club conveniences

Targeted messaging and

Price scan

retail media program

In-club coupons

Deli pre-ordering

Buy online, pick up in club

All other digital offering e.g. services

Disclaimer

BJ's Wholesale Club Holdings Inc. published this content on November 21, 2024, and is solely responsible for the information contained herein. Distributed by Public, unedited and unaltered, on November 21, 2024 at 12:11:04.783.