BJ's beats expectations...will be sold for 2.8 billion in cash in 4Q

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Solid 2Q From BJ's Reinforces Favorable Views of Warehouse Clubs Amid Economic Uncertainty

BJ's continues to profit, was just sold, we're wondering if people throughout the country who are working for them are sharing in their successes? The industry seems recession proof...Here's the AP story on their "better-than-expected" profits, again....




(Reuters) - BJ's Wholesale Club Inc (BJ.N) posted a much better-than-expected quarterly profit on Wednesday, helped by improved margins, gasoline sales and cost-cutting.

The company, which is being sold to private equity firms Leonard Green & Partners and CVC Capital Partners CVC.UL, earned $45.7 million, or 84 cents per share, in the second quarter, up from $35.8 million, or 67 cents per share, a year earlier. It had forecast a profit of $40.5 million to $42.5 million, or 74 cents to 78 cents per share.

Earnings from continuing operations were 85 cents per share, topping analysts' average forecast of 77 cents, according to Thomson Reuters I/B/E/S.

As previously reported, sales rose 11 percent to $2.98 billion. Sales at stores open at least a year rose 7.8 percent and were up 3.8 percent excluding gasoline sales.

Visits to BJ's stores were essentially flat, while the average amount spent per transaction rose by about 3 percent.

Food sales rose about 5 percent. BJ's has been adding more fresh foods and prepared meals to entice shoppers to do more of their weekly grocery shopping at the club, which charges an annual membership fee.

BJ's agreed in June to be sold for $2.8 billion in cash. The deal is expected to close in the fourth quarter.

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BJ's Wholesale Club Sold for $2.8 billion

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Stories broke on BJ's Wholesale Club's sale last week, and now there is an investor suing the company because the sale price of $2.8 billion is "grossly inadequate" Read it at Bloomberg.

BJ's Wholesale Club will be acquired by Leonard Green & Partners and CVC Capital Partners in an all-cash transaction valued at $2.8 billion. BJ's, which operates 190 warehouse clubs in 15 states, reported $10.6 billion in sales last year.

Under the terms of the agreement, BJ's shareholders will receive $51.25 per share, a 38 percent premium to the closing price June 2010, and a 7 percent premium to the closing price on June 28.

BJ's board of directors unanimously approved the merger agreement. The transaction is expected to close during the fourth quarter.

"BJ's will benefit from the continued execution of our business plan and the significant retail expertise of our new partners at LGP and CVC, as well as from continued investments in our clubs, our people and technology, and the future of our business," says Laura Sen, president and chief executive officer. "Our members will continue to enjoy the top-quality merchandise, outstanding savings and great service that they've come to expect from BJ's on every visit."

Links: http://www.licensemag.com/licensemag/News/BJs-Wholesale-Club-to-be-Acquired/ArticleStandard/Article/detail/729435?contextCategoryId=33594


WSJ: http://online.wsj.com/article/BT-CO-20110629-711984.html

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Related articles

• BJ's Wholesale: Longest Sale Process Ever? (blogs.wsj.com)
• Two Firms Pay $2.8B For BJ's (bostonist.com)
• Private equity firms to buy BJ's Wholesale for $2.8-billion (theglobeandmail.com)

More Buyout Rumors for BJ's Wholesale Club

What's going to happen to this company when it eventually gets bought out???

Shares of BJ's Wholesale Club Inc. rose Wednesday after a report that two private-equity investors are preparing a joint bid to buy the company.

Representatives for BJ's and Leonard Green did not return calls seeking comment. A spokeswoman for CVC declined to comment on the report.

Shares of BJ's rose $1, or 2 percent, to $48.70 in afternoon trading.

The New York Post also wrote about this rumor: http://www.nypost.com/p/news/business/bj_is_seeking_more_3kjfOFYrLKwKZTodp7I8TK


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Laura Sen took a 17% Pay Cut, still raked in $4M

BJ’s Wholesale Club Inc. CEO Laura Sen’s pay package totaled $4 million in 2010, down more than 17 percent from the previous year.

The Westboro-based retailer disclosed in a regulatory filing today that total compensation for Sen included $982,693 in salary along with $697,811 in performance-based pay and stock awards valued at $2.2 million.

Read more: http://news.bostonherald.com/business/general/view/2011_0406bjs_ceo_sen_made_4m_in_2010_down_17_percent/srvc=home&position=recent

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UPDATE: Happy New Years from BJ's, Now You're Laid Off- BJ's to Cut 500 Jobs

So here's a way nobody wanted to start off their 2011.  Great, happy new years from BJ's everyone had a great holiday season and is enjoying the new year. Over the past few days we've been reading up on some interesting news involving BJ's start to 2011, and wanted to fill you in on the details. Five stores will be closing in the Southeast, which will shave 380 jobs, and another 114 corporate level employees will be cut. 

"The Natick-based chain will close five underperforming stores, in Georgia, Florida, and North Carolina, which will result in the loss of 380 positions by the end of this month."

The stores are listed below, all with the closing date of January 17th.

1. Sunrise, Florida: 3469 North University Drive.  - 99 Employees
   
2. Charlotte, North Carolina:  No clear number of employees to be laid off has been announced, over 65
   
3. McDonough BJ’s Wholesale Club 1990 Jonesboro Rd. McDonough, GA 30253
   
   
4. Powder Springs BJ’s Wholesale Club 2435 East West Connector Austell, GA 30106
   
5. Norcross BJ’s Wholesale Club 6344 Cash Ct. Norcross, GA 30071
   

The way they're wording the closings? "BJ's announces Strategic Actions to Optimize Performance'" [Press Release]

Laura Sen has said that these clubs have underperformed. Though we just came across their December sale numbers which read that sales are up big and comparable sales are up 3.8%

BJ's Wholesale Club, Inc. (BJ: News ), an operator of warehouse clubs, reported that sales for December 2010 grew 7.3% to $1.25 billion from $1.16 billion in December 2009.

The Natick, Massachusetts-based company's comparable club sales for December 2010 increased by 3.8%, including a contribution from sales of gasoline of 2.4%, compared to comparable club sales increase of 4.8% in December 2009.

Sales are great, the company is doing fine, this raises an eyebrow.  Just as we previously noted, this is all a restructuring of "dead weight" (not our words) in order to sell the company.

"Management is trying to portray itself as having the ability to make the difficult decisions required to drive stronger earning growth perhaps to stay aboard under a new regime, while also displaying hidden value to would-be bidders,"- Brian Sozzi, Wall Street Strategies analyst. 

Read more at: Boston.com Also: Boston Herald

Right now, it's all about selling this company, at least that's the way it looks to us.  This flat out sucks, these 'strategic actions' are just the worst way to start the new year.

Related articles

• BJ's Wholesale Club slashes nearly 500 jobs (justjobs.com)
• BJ's Wholesale Club closing 3 stores in metro Atlanta (ajc.com)