BJ'S WHOLESALE CLUB HOLDINGS, INC., 10-Q filed on 11/24/2021
Quarterly Report
v3.21.2
Cover - shares
9 Months Ended
Oct. 30, 2021
Nov. 18, 2021
Cover [Abstract]    
Document Type 10-Q  
Document Quarterly Report true  
Document Period End Date Oct. 30, 2021  
Document Transition Report false  
Entity File Number 001-38559  
Entity Registrant Name BJ’S WHOLESALE CLUB HOLDINGS, INC.  
Entity Incorporation, State or Country Code DE  
Entity Tax Identification Number 45-2936287  
Entity Address, Address Line One 25 Research Drive  
Entity Address, City or Town Westborough  
Entity Address, State or Province MA  
Entity Address, Postal Zip Code 01581  
City Area Code 774  
Local Phone Number 512-7400  
Title of 12(b) Security Common Stock, par value $0.01  
Trading Symbol BJ  
Security Exchange Name NYSE  
Entity Current Reporting Status Yes  
Entity Interactive Data Current Yes  
Entity Filer Category Large Accelerated Filer  
Entity Small Business false  
Entity Emerging Growth Company false  
Entity Shell Company false  
Entity Common Stock, Shares Outstanding   145,348,881
Entity Central Index Key 0001531152  
Amendment Flag false  
Current Fiscal Year End Date --01-29  
Document Fiscal Period Focus Q3  
Document Fiscal Year Focus 2021  
v3.21.2
Consolidated Balance Sheets - USD ($)
$ in Thousands
Oct. 30, 2021
Jan. 30, 2021
Oct. 31, 2020
Current assets:      
Cash and cash equivalents $ 84,691 $ 43,518 $ 46,116
Accounts receivable, net 200,315 172,719 188,413
Merchandise inventories 1,255,659 1,205,695 1,264,323
Prepaid expenses and other current assets 58,622 48,649 97,116
Total current assets 1,599,287 1,470,581 1,595,968
Operating lease right-of-use assets, net 2,151,255 2,058,763 2,034,742
Property and equipment:      
Land and buildings 405,982 385,572 376,635
Leasehold costs and improvements 254,340 249,073 221,403
Furniture, fixtures and equipment 1,420,083 1,298,440 1,258,876
Construction in progress 85,743 23,633 43,382
Total property and equipment, gross 2,166,148 1,956,718 1,900,296
Less: accumulated depreciation and amortization (1,285,244) (1,158,929) (1,131,038)
Total property and equipment, net 880,904 797,789 769,258
Goodwill 924,134 924,134 924,134
Intangibles, net 127,260 135,123 138,088
Deferred income taxes 5,167 5,737 0
Other assets 22,233 19,403 20,094
Total assets 5,710,240 5,411,530 5,482,284
Current liabilities:      
Current portion of long-term debt 0 260,000 260,000
Current portion of operating lease liabilities 137,036 131,513 131,025
Accounts payable 1,235,763 988,074 1,176,104
Accrued expenses and other current liabilities 731,297 651,625 643,309
Total current liabilities 2,104,096 2,031,212 2,210,438
Long-term operating lease liabilities 2,082,287 1,988,840 1,961,321
Long-term debt 748,149 846,175 845,696
Deferred income taxes 33,995 45,096 47,241
Other non-current liabilities 173,977 180,880 200,210
Commitments and contingencies (see Note 6)
STOCKHOLDERS’ EQUITY      
Preferred stock; par value $0.01; 5,000 shares authorized, and no shares issued 0 0 0
Common stock, par value $0.01; 300,000 shares authorized, 145,318 shares issued and 136,075 outstanding at October 30, 2021; 143,428 shares issued and 137,192 outstanding at January 30, 2021; and 143,199 shares issued and 137,263 outstanding at October 31, 2020 1,453 1,434 1,432
Additional paid-in capital 889,142 826,377 814,376
Accumulated earnings (deficit) 23,745 (295,339) (391,221)
Accumulated other comprehensive loss (2,199) (20,528) (26,124)
Treasury stock, at cost, 9,243 shares at October 30, 2021; 6,236 shares at January 30, 2021; and 5,936 shares at October 31, 2020 (344,405) (192,617) (181,085)
Total stockholders’ equity 567,736 319,327 217,378
Total liabilities and stockholders’ equity $ 5,710,240 $ 5,411,530 $ 5,482,284
v3.21.2
Consolidated Balance Sheets (Parentheticals) - $ / shares
Oct. 30, 2021
Jan. 30, 2021
Oct. 31, 2020
Statement of Financial Position [Abstract]      
Preferred stock, par value (in USD per share) $ 0.01 $ 0.01 $ 0.01
Preferred stock, authorized (in shares) 5,000,000 5,000,000 5,000,000
Preferred stock, issued (in shares) 0 0 0
Common stock, par value (in USD per share) $ 0.01 $ 0.01 $ 0.01
Common stock, authorized (in shares) 300,000,000 300,000,000 300,000,000
Common stock, issued (in shares) 145,318,000 143,428,000 143,199,000
Common stock, outstanding (in shares) 136,075,000 137,192,000 137,263,000
Treasury stock (in shares) 9,243,000 6,236,000 5,936,000
v3.21.2
Consolidated Statements of Operations and Comprehensive Income - USD ($)
$ in Thousands
3 Months Ended 9 Months Ended
Oct. 30, 2021
Oct. 31, 2020
Oct. 30, 2021
Oct. 31, 2020
Total revenues $ 4,264,087 $ 3,731,669 $ 12,309,464 $ 11,483,404
Cost of sales 3,472,869 2,988,397 10,027,991 9,247,042
Selling, general and administrative expenses 617,991 552,307 1,816,014 1,733,482
Pre-opening expense 3,071 610 5,265 5,180
Operating income 170,156 190,355 460,194 497,700
Interest expense, net 11,854 25,882 47,567 68,467
Income from continuing operations before income taxes 158,302 164,473 412,627 429,233
Provision for income taxes 31,700 41,590 93,442 103,940
Income from continuing operations 126,602 122,883 319,185 325,293
Loss from discontinued operations, net of income taxes (85) (87) (101) (145)
Net income $ 126,517 $ 122,796 $ 319,084 $ 325,148
Income per share attributable to common stockholders—basic:        
Income from continuing operations (in USD per share) $ 0.93 $ 0.90 $ 2.35 $ 2.39
Loss from discontinued operations (in USD per share) 0 0 0 0
Net income (in USD per share) 0.93 0.90 2.35 2.39
Income per share attributable to common stockholders—diluted:        
Income from continuing operations (in USD per share) 0.92 0.88 2.31 2.34
Loss from discontinued operations (in USD per share) 0 0 0 0
Net income (in USD per share) $ 0.92 $ 0.88 $ 2.31 $ 2.34
Weighted average shares of common stock outstanding:        
Basic (in shares) 135,581,539 136,011,473 135,603,891 136,269,239
Diluted (in shares) 138,004,727 139,060,460 138,287,952 139,003,419
Other comprehensive income:        
Amounts released from other comprehensive income, net of tax $ 733 $ 3,670 $ 8,909 $ 3,670
Unrealized gain on cash flow hedge, net of income tax provision of $1,279 and $2,278, respectively 3,293 5,856 9,420 (3,208)
Total other comprehensive income 4,026 9,526 18,329 462
Total comprehensive income 130,543 132,322 337,413 325,610
Net sales        
Total revenues 4,172,594 3,646,723 12,042,830 11,236,403
Membership        
Total revenues $ 91,493 $ 84,946 $ 266,634 $ 247,001
v3.21.2
Consolidated Statements of Operations and Comprehensive Income (Parentheticals) - USD ($)
$ in Thousands
3 Months Ended 9 Months Ended
Oct. 30, 2021
Oct. 31, 2020
Oct. 30, 2021
Oct. 31, 2020
Income Statement [Abstract]        
Unrealized gain (loss) on cash flow hedge, tax provision (benefit) $ 1,279 $ 2,278 $ 3,662 $ (1,246)
v3.21.2
Consolidated Statements of Stockholders' Equity (Deficit) - USD ($)
shares in Thousands, $ in Thousands
Total
Common Stock
Additional Paid-in Capital
Accumulated Earnings (Deficit)
Accumulated Other Comprehensive Loss
Treasury Stock
Balance at beginning of period (in shares) at Feb. 01, 2020   140,723       (3,425)
Balance at beginning of period at Feb. 01, 2020 $ (54,344) $ 1,407 $ 773,618 $ (716,369) $ (26,586) $ (86,414)
Net income 95,734     95,734    
Unrealized gain (loss) on cash flow hedge, net of tax (13,942)       (13,942)  
Common stock issued under stock incentive plans (in shares)   1,626        
Common stock issued under stock incentive plans 0 $ 16 (16)      
Stock compensation expense 5,514   5,514      
Net cash received on option exercises 5,608   5,608      
Treasury stock purchases (in shares)           (258)
Treasury stock purchases (6,073)         $ (6,073)
Balance at end of period (in shares) at May. 02, 2020   142,349       (3,683)
Balance at end of period at May. 02, 2020 32,497 $ 1,423 784,724 (620,635) (40,528) $ (92,487)
Balance at beginning of period (in shares) at Feb. 01, 2020   140,723       (3,425)
Balance at beginning of period at Feb. 01, 2020 (54,344) $ 1,407 773,618 (716,369) (26,586) $ (86,414)
Net income 325,148          
Amounts released from other comprehensive income, net of tax 3,670          
Unrealized gain (loss) on cash flow hedge, net of tax (3,208)          
Balance at end of period (in shares) at Oct. 31, 2020   143,199       (5,936)
Balance at end of period at Oct. 31, 2020 217,378 $ 1,432 814,376 (391,221) (26,124) $ (181,085)
Balance at beginning of period (in shares) at May. 02, 2020   142,349       (3,683)
Balance at beginning of period at May. 02, 2020 32,497 $ 1,423 784,724 (620,635) (40,528) $ (92,487)
Net income 106,618     106,618    
Unrealized gain (loss) on cash flow hedge, net of tax 4,878       4,878  
Common stock issued under stock incentive plans (in shares)   246        
Common stock issued under stock incentive plans 0 $ 3 (3)      
Common stock issued under Employee Stock Purchase Plan (ESPP) (in shares)   58        
Common stock issued under Employee Stock Purchase Plan (ESPP) 1,107 $ 1 1,106      
Stock compensation expense 9,064   9,064      
Net cash received on option exercises 3,397   3,397      
Treasury stock purchases (in shares)           (1,047)
Treasury stock purchases (38,460)         $ (38,460)
Balance at end of period (in shares) at Aug. 01, 2020   142,653       (4,730)
Balance at end of period at Aug. 01, 2020 119,101 $ 1,427 798,288 (514,017) (35,650) $ (130,947)
Net income 122,796     122,796    
Amounts released from other comprehensive income, net of tax 3,670       3,670  
Unrealized gain (loss) on cash flow hedge, net of tax 5,856       5,856  
Common stock issued under stock incentive plans (in shares)   546        
Common stock issued under stock incentive plans 0 $ 5 (5)      
Stock compensation expense 8,667   8,667      
Net cash received on option exercises 7,426   7,426      
Treasury stock purchases (in shares)           (1,206)
Treasury stock purchases (50,138)         $ (50,138)
Balance at end of period (in shares) at Oct. 31, 2020   143,199       (5,936)
Balance at end of period at Oct. 31, 2020 217,378 $ 1,432 814,376 (391,221) (26,124) $ (181,085)
Balance at beginning of period (in shares) at Jan. 30, 2021   143,428       (6,236)
Balance at beginning of period at Jan. 30, 2021 319,327 $ 1,434 826,377 (295,339) (20,528) $ (192,617)
Net income 81,579     81,579    
Amounts released from other comprehensive income, net of tax 4,665       4,665  
Unrealized gain (loss) on cash flow hedge, net of tax 3,187       3,187  
Common stock issued under stock incentive plans (in shares)   590        
Common stock issued under stock incentive plans 0 $ 6 (6)      
Stock compensation expense 27,300   27,300      
Net cash received on option exercises 1,497   1,497      
Treasury stock purchases (in shares)           (542)
Treasury stock purchases (24,031)         $ (24,031)
Balance at end of period (in shares) at May. 01, 2021   144,018       (6,778)
Balance at end of period at May. 01, 2021 413,524 $ 1,440 855,168 (213,760) (12,676) $ (216,648)
Balance at beginning of period (in shares) at Jan. 30, 2021   143,428       (6,236)
Balance at beginning of period at Jan. 30, 2021 319,327 $ 1,434 826,377 (295,339) (20,528) $ (192,617)
Net income 319,084          
Amounts released from other comprehensive income, net of tax 8,909          
Unrealized gain (loss) on cash flow hedge, net of tax 9,420          
Balance at end of period (in shares) at Oct. 30, 2021   145,318       (9,243)
Balance at end of period at Oct. 30, 2021 567,736 $ 1,453 889,142 23,745 (2,199) $ (344,405)
Balance at beginning of period (in shares) at May. 01, 2021   144,018       (6,778)
Balance at beginning of period at May. 01, 2021 413,524 $ 1,440 855,168 (213,760) (12,676) $ (216,648)
Net income 110,988     110,988    
Amounts released from other comprehensive income, net of tax 3,511       3,511  
Unrealized gain (loss) on cash flow hedge, net of tax 2,940       2,940  
Common stock issued under stock incentive plans (in shares)   223        
Common stock issued under stock incentive plans 0 $ 2 (2)      
Common stock issued under Employee Stock Purchase Plan (ESPP) (in shares)   59        
Common stock issued under Employee Stock Purchase Plan (ESPP) 1,877 $ 1 1,876      
Stock compensation expense 7,334   7,334      
Net cash received on option exercises 3,416   3,416      
Treasury stock purchases (in shares)           (1,175)
Treasury stock purchases (55,238)         $ (55,238)
Balance at end of period (in shares) at Jul. 31, 2021   144,300       (7,953)
Balance at end of period at Jul. 31, 2021 488,352 $ 1,443 867,792 (102,772) (6,225) $ (271,886)
Net income 126,517     126,517    
Amounts released from other comprehensive income, net of tax 733       733  
Unrealized gain (loss) on cash flow hedge, net of tax 3,293       3,293  
Common stock issued under stock incentive plans (in shares)   1,018        
Common stock issued under stock incentive plans 0 $ 10 (10)      
Stock compensation expense 7,794   7,794      
Net cash received on option exercises 13,566   13,566      
Treasury stock purchases (in shares)           (1,290)
Treasury stock purchases (72,519)         $ (72,519)
Balance at end of period (in shares) at Oct. 30, 2021   145,318       (9,243)
Balance at end of period at Oct. 30, 2021 $ 567,736 $ 1,453 $ 889,142 $ 23,745 $ (2,199) $ (344,405)
v3.21.2
Consolidated Statements of Cash Flows - USD ($)
$ in Thousands
9 Months Ended
Oct. 30, 2021
Oct. 31, 2020
CASH FLOWS FROM OPERATING ACTIVITIES    
Net income $ 319,084 $ 325,148
Adjustments to reconcile net income to net cash provided by operating activities:    
Depreciation and amortization 135,664 124,331
Amortization of debt issuance costs and accretion of original issue discount 2,555 3,470
Debt extinguishment charges 657 4,077
Stock-based compensation expense 42,428 23,245
Deferred income tax (benefit) provision (17,659) 2,289
Changes in operating leases and other non-cash items 6,112 5,441
Increase (decrease) in cash due to changes in:    
Accounts receivable (27,596) 17,940
Merchandise inventories (49,964) (182,821)
Prepaid expenses and other current assets (13,841) (16,964)
Other assets (2,882) (1,959)
Accounts payable 247,689 389,692
Accrued expenses and other current liabilities 72,525 61,829
Other non-current liabilities 18,403 46,254
Net cash provided by operating activities 733,175 801,972
CASH FLOWS FROM INVESTING ACTIVITIES    
Additions to property and equipment, net of disposals (222,498) (152,800)
Proceeds from sale leaseback transactions 19,080 25,893
Net cash used in investing activities (203,418) (126,907)
CASH FLOWS FROM FINANCING ACTIVITIES    
Payments on First Lien Term Loan (100,000) (513,297)
Proceeds from ABL Facility 0 996,000
Payments on ABL Facility (260,000) (1,064,000)
Net cash received from stock option exercises 18,479 16,431
Net cash received from ESPP 1,877 1,107
Acquisition of treasury stock (149,449) (94,671)
Proceeds from financing obligations 1,333 0
Other financing activities (824) (723)
Net cash used in financing activities (488,584) (659,153)
Net increase in cash and cash equivalents 41,173 15,912
Cash and cash equivalents at beginning of period 43,518 30,204
Cash and cash equivalents at end of period 84,691 46,116
Supplemental cash flow information:    
Interest paid 34,189 52,306
Income taxes paid 100,753 111,105
Non-cash financing and investing activities:    
Lease liabilities arising from obtaining right-of-use assets 213,642 90,320
Property additions included in accrued expenses $ 25,445 $ 10,760
v3.21.2
Description of Business
9 Months Ended
Oct. 30, 2021
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Description of Business Description of Business
BJ’s Wholesale Club Holdings, Inc. and its wholly-owned subsidiaries is a leading warehouse club operator primarily on the east coast of the United States. As of October 30, 2021, the Company operated 222 warehouse clubs and 151 gas stations in 17 states.
The Company follows and reports based on the National Retail Federation’s fiscal calendar. The thirteen week periods ended October 30, 2021 and October 31, 2020 are referred to as the "third quarter of fiscal year 2021" and the "third quarter of fiscal year 2020," respectively.
The novel coronavirus ("COVID-19") pandemic has severely impacted the economies of the U.S. and other countries around the world. In the preparation of these financial statements and related disclosures we have assessed the impact that COVID-19 has had on our estimates, assumptions and accounting policies and made additional disclosures, as necessary.
v3.21.2
Summary of Significant Accounting Policies
9 Months Ended
Oct. 30, 2021
Accounting Policies [Abstract]  
Summary of Significant Accounting Policies Summary of Significant Accounting Policies
Basis of Presentation
The accompanying interim financial statements of BJ’s Wholesale Club Holdings, Inc. are unaudited and, in the opinion of management, reflect all normal recurring adjustments considered necessary for a fair statement of the Company’s financial statements in accordance with generally accepted accounting principles in the United States of America ("GAAP"). 
The consolidated balance sheet as of January 30, 2021 is derived from the audited consolidated balance sheet as of that date. The unaudited results of operations through the third quarter of fiscal year 2021 are not necessarily indicative of future results or results to be expected for fiscal year 2021. The Company’s business, in common with the business of retailers generally, is subject to seasonal influences. The Company’s sales and operating income have typically been highest in the fourth quarter holiday season and lowest in the first quarter of each fiscal year. 
These unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and footnotes thereto included in our Annual Report on Form 10-K for the fiscal year 2020, as filed with the Securities and Exchange Commission on March 19, 2021.
Recently Adopted Accounting Pronouncements
The accounting policies the Company follows are set forth in its audited financial statements for fiscal year 2020. There have been no material changes to these accounting policies, except as noted below for a new accounting pronouncement adopted at the beginning of fiscal year 2021.
Income Taxes (ASU 2019-12)
In December 2019, the Financial Accounting Standards Board issued Accounting Standards Update ("ASU") 2019-12, Simplifying the Accounting for Income Taxes (Topic 740). This standard simplifies the accounting for income taxes by eliminating certain exceptions to the guidance in Accounting Standards Codification 740 related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. The standard also simplifies aspects of the accounting for franchise taxes and enacted changes in tax laws or rates and clarifies the accounting for transactions that result in a step-up in the tax basis of goodwill. The standard is effective for public companies for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. The Company adopted this standard as of January 31, 2021. The adoption of this standard did not have a material impact on the Companys consolidated financial statements.
v3.21.2
Revenue Recognition
9 Months Ended
Oct. 30, 2021
Revenue from Contract with Customer [Abstract]  
Revenue Recognition Revenue Recognition
Performance Obligations
The Company identifies each distinct performance obligation to transfer goods (or bundle of goods) or services. The Company recognizes revenue as it satisfies a performance obligation by transferring control of the goods or services to the customer.
Net sales—The Company recognizes net sales at clubs and gas stations when the customer takes possession of the goods and tenders payment. Sales tax is recorded as a liability at the point of sale. Revenue is recorded at the point of sale based on the transaction price on the shelf sign, net of any applicable discounts, sales tax and expected refunds. For e-commerce sales, the Company recognizes sales when control of the merchandise is transferred to the customer, which is typically at the shipping point. The following tables summarize the Company’s point of sale transactions at clubs and gas stations, excluding sales tax, as a percentage of both net sales and total revenues:
Thirteen Weeks Ended
October 30, 2021October 31, 2020
Point of sale transactions, excluding sales tax, as a percent of net sales
94%
96%
Point of sale transactions, excluding sales tax, as a percent of total revenues
92%
94%
Thirty-Nine Weeks Ended
October 30, 2021October 31, 2020
Point of sale transactions, excluding sales tax, as a percent of net sales
93%
96%
Point of sale transactions, excluding sales tax, as a percent of total revenues
91%
94%
BJ’s Perks Rewards and My BJ’s Perks programs—The Company’s BJ’s Perks Rewards® membership program allows participating members to earn 2% cash back, up to a maximum of $500 per year, on qualified purchases made at BJ’s. The Company also offers a co-branded credit card program, the My BJ’s Perks® program, which allows My BJ’s Perks® Mastercard credit card holders to earn up to 5% cash back on eligible purchases made at BJ’s and up to 2% cash back on purchases made with the card outside of BJ’s. Cash back has been in the form of electronic awards issued in $10 increments that may be used online or in-club at the register and expire six months from the date issued. 
Earned awards may be redeemed on future purchases made at the Company. The Company recognizes revenue for earned awards when customers redeem such awards as part of a purchase at one of the Company’s clubs or on the Company’s website or app. The Company accounts for these transactions as multiple element arrangements and allocates the transaction price to separate performance obligations using their relative fair values. The Company includes the fair value of award dollars earned in deferred revenue at the time the award dollars are earned. This liability was $29.3 million at October 30, 2021, $25.5 million at January 30, 2021 and $24.6 million at October 31, 2020.
Royalty revenue received in connection with the My BJ’s Perks co-brand credit card program is variable consideration and is considered deferred until the card holder makes a purchase. The Company’s total deferred royalty revenue related to the outstanding My BJ’s Perks Rewards was $19.1 million, $13.5 million and $13.5 million at October 30, 2021, January 30, 2021 and October 31, 2020, respectively. The timing of revenue recognition is driven by actual customer activities, such as redemptions and expirations. As of October 30, 2021, the Company expects to recognize $13.4 million of the deferred revenue in fiscal year 2021 and expects the remainder to be recognized in the periods thereafter.
Membership—The Company charges a membership fee to its customers. That fee allows customers to shop in the Company’s clubs, shop on the Company’s website and app and purchase gasoline at the Company’s gas stations for the duration of the membership, which is generally 12 months. As the Company has the obligation to provide access to its clubs, website, app and gas stations for the duration of the membership term, the Company recognizes membership fees on a straight-line basis over the life of the membership. The Company’s deferred revenue related to membership fees was $168.1 million, $155.6 million and $151.2 million at October 30, 2021, January 30, 2021 and October 31, 2020, respectively.
Gift Card Program—The Company sells BJ’s gift cards in both physical and digital format, which allow customers to redeem the card for future purchases equal to the amount of the original purchase price of the gift card. Revenue from gift card sales is recognized in proportion to its rate of gift card redemptions as the Company’s performance obligation to redeem the gift
card for merchandise is satisfied when the gift card is redeemed. The Company also recognizes breakage in proportion to its rate of gift card redemptions. Deferred revenue related to gift cards was $10.3 million, $10.3 million and $9.0 million at October 30, 2021, January 30, 2021 and October 31, 2020, respectively. The Company recognized $8.9 million and $9.2 million of revenue from gift card redemptions in the third quarter of fiscal year 2021 and third quarter of fiscal year 2020, respectively. The Company recognized $27.3 million and $28.7 million of revenue from gift card redemptions in the thirty-nine weeks ended October 30, 2021 and October 31, 2020, respectively.
Disaggregation of Revenue
The Company’s club retail operations, which represent substantially all of its consolidated total revenues, are the Company’s only reportable segment. All the Company’s identifiable assets are in the United States. The Company does not have significant sales outside the United States, nor does any customer represent more than 10% of total revenues for any period presented.
The following tables summarize the Company’s percentage of net sales disaggregated by category:
Thirteen Weeks Ended
October 30, 2021October 31, 2020
Grocery72 %77 %
General Merchandise & Services12 %13 %
Gasoline and Other16 %10 %
Thirty-Nine Weeks Ended
October 30, 2021October 31, 2020
Grocery71 %78 %
General Merchandise & Services14 %13 %
Gasoline and Other15 %%
v3.21.2
Debt and Credit Arrangements
9 Months Ended
Oct. 30, 2021
Debt Disclosure [Abstract]  
Debt and Credit Arrangements Debt and Credit Arrangements
The following table summarizes the Company’s debt (in thousands):
October 30, 2021January 30, 2021October 31, 2020
ABL Facility$50,000 $310,000 $310,000 
First Lien Term Loan701,920 801,920 801,920 
Unamortized debt discount and debt issuance cost(3,771)(5,745)(6,224)
Less: current portion— (260,000)(260,000)
Long-term debt$748,149 $846,175 $845,696 
ABL Facility
The ABL Facility is comprised of a $950.0 million revolving credit facility and a $50.0 million term loan. The ABL Facility is secured on a senior basis by certain "liquid assets" of the Company and secured on a junior basis by certain "fixed assets" of the Company. Payment terms on the $50.0 million term loan are restricted in that the term loan cannot be repaid unless all loans outstanding under the revolving credit facility are repaid, and once repaid, cannot be re-borrowed. The availability under the $950.0 million revolving credit facility is restricted based on eligible monthly merchandise inventories and receivables as defined in the agreement governing the ABL Facility. As amended, interest on the revolving credit facility is calculated either at LIBOR plus a range of 125 to 175 basis points or a base rate plus a range of 25 to 75 basis points; and interest on the term loan is calculated at LIBOR plus a range of 200 to 250 basis points or a base rate plus a range of 100 to 150 basis points, in all cases based on excess availability. The applicable spread of LIBOR and base rate loans at all levels of excess availability steps down by 12.5 basis points upon achieving total net leverage of 3.00 to 1.00. The ABL Facility also provides a sub-facility for issuances of letters of credit subject to certain fees defined in the agreement governing the ABL Facility. The ABL Facility is subject to various commitment fees during the term of the facility based on utilization of the revolving credit facility, which is scheduled to mature on August 17, 2023.
At October 30, 2021, there were $50.0 million outstanding in loans under the ABL Facility and $19.4 million in outstanding letters of credit. The interest rate on the revolving credit facility was 1.20%, the interest rate of the term loan was 2.08% and unused capacity was $930.6 million.
At January 30, 2021, there were $310.0 million outstanding in loans under the ABL Facility and $15.0 million in outstanding letters of credit. The interest rate on the revolving credit facility was 1.25%, the interest rate of the term loan was 2.14% and unused capacity was $641.1 million.
At October 31, 2020, there were $310.0 million outstanding in loans under the ABL Facility and $21.2 million in outstanding letters of credit. The interest rate on the revolving credit facility was 1.27%, the interest rate of the term loan was 2.14% and unused capacity was $670.8 million.
First Lien Term Loan
The Company’s First Lien Term Loan matures on February 3, 2024. Voluntary prepayments are permitted. Principal payments must be made on the First Lien Term Loan pursuant to an annual excess cash flow calculation when the net leverage ratio exceeds 3.50 to 1.00. The First Lien Term Loan is subject to certain affirmative and negative covenants but no financial covenants. It is secured on a senior basis by certain "fixed assets" of the Company and on a junior basis by certain "liquid" assets of the Company. 
On October 30, 2020, the Company borrowed $260.0 million from the ABL Facility. The proceeds from the Company’s borrowing and $100.0 million of the Company’s cash and cash equivalents were used to pay $360.0 million of the principal amount outstanding on the First Lien Term Loan. In connection with the payment, the Company expensed $2.8 million of previously capitalized debt issuance costs and original issue discount.
On April 30, 2021, the Company used $100.0 million of cash and cash equivalents to pay $100.0 million of the principal amount outstanding on the First Lien Term Loan. In connection with the payment, the Company expensed $0.7 million of previously capitalized debt issuance costs and original issue discount.
There were $701.9 million, $801.9 million and $801.9 million outstanding on the First Lien Term Loan at October 30, 2021, January 30, 2021 and October 31, 2020, respectively. Interest rates for the First Lien Term Loan were 2.09%, 2.13% and 2.15% at October 30, 2021, January 30, 2021 and October 31, 2020, respectively.
v3.21.2
Interest Expense, Net
9 Months Ended
Oct. 30, 2021
Other Income and Expenses [Abstract]  
Interest Expense, net Interest Expense, net
The following details the components of interest expense for the periods presented (in thousands):
Thirteen Weeks EndedThirty-Nine Weeks Ended
October 30, 2021October 31, 2020October 30, 2021October 31, 2020
Interest on debt$10,864 $15,915 $34,264 $52,860 
Interest on capital lease and financing obligations966 972 2,947 2,971 
Debt issuance costs amortization544 629 1,649 1,934 
Original issue discount amortization288 477 906 1,535 
Loss on debt extinguishment— 2,794 657 4,077 
Loss (gain) on cash flow hedge(808)5,097 7,146 5,097 
Capitalized interest— (2)(2)(7)
Interest expense, net$11,854 $25,882 $47,567 $68,467 
Interest expense in the thirteen and thirty-nine weeks ended October 30, 2021 decreased due to lower debt balances outstanding and lower interest rates
v3.21.2
Commitments and Contingencies
9 Months Ended
Oct. 30, 2021
Commitments and Contingencies Disclosure [Abstract]  
Commitments and Contingencies Commitments and ContingenciesThe Company is involved in various legal proceedings that are typical of a retail business. In accordance with applicable accounting guidance, an accrual will be established for legal proceedings if and when those matters present loss contingencies that are both probable and estimable. The Company does not believe the resolution of any current proceedings will result in a material loss to the consolidated financial statements.
v3.21.2
Stock Incentive Plans
9 Months Ended
Oct. 30, 2021
Share-based Payment Arrangement [Abstract]  
Stock Incentive Plans Stock Incentive Plans
On June 13, 2018, the Company’s Board of Directors adopted, and its stockholders approved, the BJ’s Wholesale Club Holdings, Inc. 2018 Incentive Award Plan (the "2018 Plan"). The 2018 Plan provides for the grant of stock options, restricted stock, dividend equivalents, stock payments, restricted stock units, performance shares, other incentive awards, stock appreciation rights, and cash awards. Prior to the adoption of the 2018 Plan, the Company granted stock-based compensation to employees and non-employee directors under the Fourth Amended and Restated 2011 Stock Option Plan of BJ’s Wholesale Club, Inc. (f/k/a Beacon Holding Inc.), as amended (the "2011 Plan") and the 2012 Director Stock Option Plan of BJ’s Wholesale Club Holdings, Inc. (f/k/a Beacon Holding, Inc.), as amended (the "2012 Director Plan"). No further grants will be made under the 2011 Plan or the 2012 Director Plan.
The 2018 Plan authorizes the issuance of 13,148,058 shares, including 985,369 shares that were reserved but not issued under the 2011 Plan and the 2012 Director Plan. If an award under the 2018 Plan, the 2011 Plan or the 2012 Director Plan is forfeited, expires or is settled for cash, any shares subject to such award may, to the extent of such forfeiture, expiration or cash settlement, be used again for new grants under the 2018 Plan. Additionally, shares tendered or withheld to satisfy grant or exercise price, or tax withholding obligations associated with an award under the 2018 Plan, the 2011 Plan or the 2012 Director Plan will be added to the shares authorized for grant under the 2018 Plan. The following shares may not be used again for grant under the 2018 Plan: (1) shares subject to a stock appreciation right ("SAR") that are not issued in connection with the stock settlement of the SAR upon its exercise and (2) shares purchased on the open market with the cash proceeds from the exercise of options under the 2018 Plan, 2011 Plan or 2012 Director Plan. As of October 30, 2021, there were 5,565,015 shares available for future issuance under the 2018 Plan.
On April 16, 2021, the Compensation Committee approved a modification to the equity awards agreements under the 2011 Plan, 2012 Director Plan and 2018 Plan. In the event that an employee is terminated due to death or disability, the modified equity award agreements provide for: (i) full vesting of all time-based awards, including restricted stock awards and stock options, (ii) pro-rata vesting of all performance-based awards, including performance share units, based on actual performance as of the end of the applicable performance period, pro-rated based on the period of employment during the applicable performance period, and (iii) the extension of the post-termination exercise window for vested stock options.
The following table summarizes the Company’s stock award activity during the thirty-nine weeks ended October 30, 2021 (shares in thousands):
Stock OptionsRestricted StockRestricted Stock UnitsPerformance Stock
SharesWeighted
Average
Exercise
Price
SharesWeighted
Average
Grant
Date Fair
Value
SharesWeighted
Average
Grant
Date Fair
Value
SharesWeighted
Average
Grant
Date Fair
Value
Outstanding, January 30, 20213,673 $17.50 1,575 $26.29 29 $34.54 527 $23.96 
Granted— — 494 44.59 26 46.82 422 44.96 
Forfeited/canceled— — (14)39.76 — — (282)28.98 
Exercised/vested(1,322)13.97 (1,013)29.52 (29)34.60 — — 
Outstanding, October 30, 20212,350 $19.49 1,042 $33.99 26 $46.82 666 $39.56 
Stock-based compensation expense was $7.8 million and $8.7 million for the thirteen weeks ended October 30, 2021 and October 31, 2020, respectively. Stock-based compensation expense was $42.4 million and $23.2 million for the thirty-nine weeks ended October 30, 2021 and October 31, 2020, respectively. Stock-based compensation expense in the thirty-nine weeks ended October 30, 2021 included $17.5 million of stock-based compensation expense related to the modification of stock awards for a former executive.
On June 14, 2018, the Company’s Board of Directors adopted, and its stockholders approved, the BJ’s Wholesale Club Holdings, Inc. Employee Stock Purchase Plan (the "ESPP"), which became effective July 1, 2018. The aggregate number of shares of common stock that were to be reserved for issuance under the ESPP was to be equal to the sum of (i) 973,014 shares and (ii) an annual increase on the first day of each calendar year beginning in 2019 and ending in 2028 equal to the lesser of (A) 486,507 shares, (B) 0.5% of the shares outstanding (on an as converted basis) on the last day of the immediately preceding fiscal year and (C) such smaller number of shares as determined by the Board of Directors. The offering under the ESPP commenced on January 1, 2019. The amount of expense recognized for both the thirteen weeks ended October 30, 2021 and October 31, 2020 was $0.2 million. The amount of expense recognized for the thirty-nine weeks ended October 30, 2021 and October 31, 2020 was $0.7 million and $0.5 million, respectively. As of October 30, 2021, there were 2,177,223 shares available for issuance under the ESPP.
Treasury Shares Acquired
The Company reacquired 28,398 shares to satisfy employees’ tax withholding obligations upon the vesting of restricted stock awards in the thirteen weeks ended October 30, 2021, which were recorded as $1.0 million of treasury stock. The Company reacquired 6,727 shares in the thirteen weeks ended October 31, 2020, which were recorded as $0.1 million of treasury stock.
The Company reacquired 375,223 shares to satisfy employees’ tax withholding obligations upon the vesting of restricted stock awards in the thirty-nine weeks ended October 30, 2021, which were recorded as $16.7 million of treasury stock. The Company reacquired 211,995 shares in the thirty-nine weeks ended October 31, 2020, which were recorded as $6.5 million of treasury stock.
Share Repurchase Program
On December 19, 2019, the Company’s Board of Directors authorized the repurchase of up to $250.0 million of the Company’s outstanding common stock from time to time as market conditions warrant (the "Program"). The Program expires at the end of fiscal year 2021. The Company initiated the Program to mitigate potentially dilutive effects of stock options and shares of restricted stock granted by the Company, in addition to enhancing shareholder value. As of October 30, 2021, $15.3 million remained available to purchase under the Program. The Company repurchased 1,261,873 shares for $71.6 million and 1,200,000 shares for $50.0 million during the thirteen weeks ended October 30, 2021 and October 31, 2020, respectively. The Company repurchased 2,630,989 shares for $135.1 million and 2,299,282 shares for $88.1 million during the thirty-nine weeks ended October 30, 2021 and October 31, 2020, respectively.
v3.21.2
Income Taxes
9 Months Ended
Oct. 30, 2021
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
The Company projects the estimated annual effective tax rate for fiscal year 2021 to be 26.8%, excluding the tax effect of discrete events, such as excess tax benefits from stock-based compensation, changes in tax legislation, settlements of tax audits and changes in uncertain tax positions, among others.
The Company’s effective income tax rate from continuing operations was 20.0% and 25.3% for the thirteen weeks ended October 30, 2021 and October 31, 2020, respectively; and 22.6% and 24.2% for the thirty-nine weeks ended October 30, 2021 and October 31, 2020, respectively. The decrease in the effective tax rate for the thirteen and thirty-nine weeks ended October 30, 2021 compared to the thirteen and thirty-nine weeks ended October 31, 2020 is due primarily to higher excess tax benefits from stock-based compensation as a result of activity related to a former executive.
The Company is subject to taxation in the U.S. federal and various state taxing jurisdictions. In general, the Company’s tax years from 2016 forward remain open and subject to examination by the Internal Revenue Service and various state taxing authorities; however, certain ongoing state audits and appeals relate to periods prior to 2016.
v3.21.2
Fair Value Measurements
9 Months Ended
Oct. 30, 2021
Fair Value Disclosures [Abstract]  
Fair Value Measurements Fair Value Measurements
Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date or "exit price." The inputs used to measure fair value are generally classified into the following hierarchy:
Level 1: Unadjusted quoted prices in active markets for identical assets or liabilities.
Level 2: Unadjusted quoted prices in active markets for similar assets or liabilities, or unadjusted quoted prices for identical or similar assets or liabilities in markets that are not observable for the asset or liability.
Level 3: Unobservable inputs for the asset or liability.
Assets and Liabilities Measured at Fair Value on a Recurring Basis
The fair values of the Company’s derivative instruments are based on quotes received from third-party banks and represent the estimated amount the Company would pay to terminate the agreements taking into consideration current interest rates as well as the creditworthiness of the counterparties. These inputs are considered to be Level 2.
Financial Assets and Liabilities
The gross carrying amount and fair value of the Company’s debt at October 30, 2021 are as follows (in thousands):
Carrying AmountFair Value
First Lien Term Loan$701,920 $701,857 
ABL Facility50,000 50,000 
Total Debt$751,920 $751,857 
The gross carrying amount and fair value of the Company’s debt at January 30, 2021 are as follows (in thousands):
Carrying AmountFair Value
First Lien Term Loan$801,920 $802,256 
ABL Facility310,000 310,000 
Total Debt$1,111,920 $1,112,256 
The gross carrying amount and fair value of the Company’s debt at October 31, 2020 are as follows (in thousands):
Carrying AmountFair Value
First Lien Term Loan$801,920 $788,800 
ABL Facility310,000 310,000 
Total Debt$1,111,920 $1,098,800 
Assets and Liabilities Measured at Fair Value on a Non-Recurring Basis
The Company measures certain non-financial assets and liabilities, including long-lived assets, at fair value on a non-recurring basis.
The Company believes that the carrying amounts of its other financial instruments, including cash, accounts receivable, and accounts payable, approximates their carrying value due to the short-term maturities of these instruments.
v3.21.2
Earnings Per Share
9 Months Ended
Oct. 30, 2021
Earnings Per Share [Abstract]  
Earnings Per Share Earnings Per Share
The table below reconciles basic weighted-average shares of common stock outstanding to diluted weighted-average shares of common stock outstanding for the thirteen and thirty-nine weeks ended October 30, 2021 and October 31, 2020:
Thirteen Weeks EndedThirty-Nine Weeks Ended
October 30, 2021October 31, 2020October 30, 2021October 31, 2020
Weighted-average shares of common stock outstanding, used for basic computation135,581,539 136,011,473 135,603,891 136,269,239 
Plus: Incremental shares of potentially dilutive securities2,423,188 3,048,987 2,684,061 2,734,180 
Weighted-average shares of common stock and dilutive potential shares of common stock outstanding138,004,727 139,060,460 138,287,952 139,003,419 
As their inclusion would have been anti-dilutive, 1,933 restricted shares were excluded from the computation of diluted earnings for the thirteen weeks ended October 30, 2021, and 1,252 restricted shares were excluded from the computation of diluted earnings for the thirteen weeks ended October 31, 2020.
Similarly, 42,483 restricted shares were excluded from the computation of diluted earnings for the thirty-nine weeks ended October 30, 2021. A total of 368,554 stock options and 260,503 restricted shares were excluded from the computation of diluted earnings for the thirty-nine weeks ended October 31, 2020.
v3.21.2
Derivative Financial Instruments
9 Months Ended
Oct. 30, 2021
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Derivative Financial Instruments Derivative Financial Instruments
Interest Rate Swaps
On November 13, 2018, the Company entered into three forward starting interest rate swaps (the "interest rate swaps"), which became effective on February 13, 2019. The Company fixed the LIBOR component of $1.2 billion of its floating rate debt at a rate of approximately 3.0% from February 13, 2019 to February 13, 2022. The Company elected hedge accounting for the interest rate swap agreements, and as such, the effective portion of the gains or losses were recorded as a component of other comprehensive income and the ineffective portion of gains or losses were recorded as interest expense.
On October 30, 2020, the Company borrowed $260.0 million from the ABL Facility. The proceeds from the Company’s borrowing, as well as $100.0 million of the Company’s cash and cash equivalents, were used to pay $360.0 million of the principal amount outstanding on the First Lien Term Loan. Due to the payment of debt principal on the First Lien Term Loan, the Company determined that certain interest payments were no longer probable and a portion of one of the interest rate swap agreements would be ineffective as a result of the payment of debt, and as such, released $3.7 million recorded in other comprehensive income to interest expense, net of tax.
On November 10, 2020, the Company terminated one of the interest rate swaps, which fixed $360.0 million of its floating rate debt at a rate of approximately 3.0%. An additional interest rate swap, which fixed $240.0 million of its floating rate debt at a rate of 3.0%, was determined to be ineffective.
On April 30, 2021, the Company used $150.0 million of its cash and cash equivalents to pay $100.0 million of the principal amount outstanding on the First Lien Term Loan and $50.0 million of the outstanding amounts on the ABL Facility. The Company accelerated the release of unrealized losses into earnings on the ineffective interest rate swap agreements and reclassified $4.7 million recorded in other comprehensive income to interest expense, net of tax.
On July 30, 2021, the Company used $210.0 million of its cash and cash equivalents to pay $210.0 million of the principal amount outstanding on the ABL Facility. The Company accelerated the release of unrealized losses into earnings on the ineffective interest rate swap agreements and reclassified $3.5 million recorded in other comprehensive income to interest expense, net of tax.
The interest rate swaps were recorded as a liability of $8.3 million, $26.4 million and $45.3 million at October 30, 2021, January 30, 2021 and October 31, 2020, respectively. The net of tax amount for the effective and ineffective interest rate swaps were recorded in other comprehensive income and interest expense, respectively.
There were gains of $4.6 million and $8.1 million recorded in other comprehensive income for the thirteen weeks ended October 30, 2021 and October 31, 2020, respectively. There were $12.9 million of gains and $4.5 million of losses recorded in other comprehensive income for the thirty-nine weeks ended October 30, 2021 and October 31, 2020, respectively. The ineffective portion of gains in the third quarter and first nine months of fiscal year 2021 of $1.8 million and $5.1 million, respectively, were recorded in interest expense. In the third quarter and first nine months of fiscal year 2020, all interest rate swap agreements were effective.
The fair values of derivative instruments included on the consolidated balance sheets are as follows (in thousands):
Fair Value at
Accounting
for Cash Flow Hedges
Notional AmountFixed RateBalance Sheet ClassificationOctober 30, 2021January 30, 2021October 31, 2020
Interest rate swap$600,000 3.00 %Other current liabilities$(5,952)$(18,828)$(22,670)
Interest rate swap360,000 3.00 %Other current liabilities(13,587)
Interest rate swap240,000 3.00 %Other current liabilities(2,379)(7,525)(9,061)
Net carrying amount$1,200,000 Total liabilities$(8,330)$(26,353)$(45,318)
v3.21.2
Subsequent Event
9 Months Ended
Oct. 30, 2021
Subsequent Events [Abstract]  
Subsequent Event Subsequent EventOn November 16, 2021, the Company’s Board of Directors approved a new share repurchase program (the "2021 Repurchase Program"), effective immediately. The authorization allows the Company to repurchase up to $500.0 million of its outstanding common stock. The 2021 Repurchase Program expires in January 2025 and gives management the flexibility to determine the terms and conditions under which shares may be purchased. The amount and timing of any repurchases made under the 2021 Repurchase Program will depend on a variety of factors, including available liquidity, cash flow and market conditions. The 2021 Repurchase Program does not obligate the Company to repurchase any dollar amount or number of shares of common stock, and the program may be suspended or discontinued at any time. The Program that was approved in December 2019 was fully exhausted on November 17, 2021.
v3.21.2
Summary of Significant Accounting Policies (Policies)
9 Months Ended
Oct. 30, 2021
Accounting Policies [Abstract]  
Basis of Presentation
Basis of Presentation
The accompanying interim financial statements of BJ’s Wholesale Club Holdings, Inc. are unaudited and, in the opinion of management, reflect all normal recurring adjustments considered necessary for a fair statement of the Company’s financial statements in accordance with generally accepted accounting principles in the United States of America ("GAAP"). 
The consolidated balance sheet as of January 30, 2021 is derived from the audited consolidated balance sheet as of that date. The unaudited results of operations through the third quarter of fiscal year 2021 are not necessarily indicative of future results or results to be expected for fiscal year 2021. The Company’s business, in common with the business of retailers generally, is subject to seasonal influences. The Company’s sales and operating income have typically been highest in the fourth quarter holiday season and lowest in the first quarter of each fiscal year. 
These unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and footnotes thereto included in our Annual Report on Form 10-K for the fiscal year 2020, as filed with the Securities and Exchange Commission on March 19, 2021.
Recently Adopted Accounting Pronouncements
Recently Adopted Accounting Pronouncements
The accounting policies the Company follows are set forth in its audited financial statements for fiscal year 2020. There have been no material changes to these accounting policies, except as noted below for a new accounting pronouncement adopted at the beginning of fiscal year 2021.
Income Taxes (ASU 2019-12)
In December 2019, the Financial Accounting Standards Board issued Accounting Standards Update ("ASU") 2019-12, Simplifying the Accounting for Income Taxes (Topic 740). This standard simplifies the accounting for income taxes by eliminating certain exceptions to the guidance in Accounting Standards Codification 740 related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. The standard also simplifies aspects of the accounting for franchise taxes and enacted changes in tax laws or rates and clarifies the accounting for transactions that result in a step-up in the tax basis of goodwill. The standard is effective for public companies for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. The Company adopted this standard as of January 31, 2021. The adoption of this standard did not have a material impact on the Companys consolidated financial statements.
v3.21.2
Revenue Recognition (Tables)
9 Months Ended
Oct. 30, 2021
Revenue from Contract with Customer [Abstract]  
Point of sale transactions as a percentage of net sales and total revenues The following tables summarize the Company’s point of sale transactions at clubs and gas stations, excluding sales tax, as a percentage of both net sales and total revenues:
Thirteen Weeks Ended
October 30, 2021October 31, 2020
Point of sale transactions, excluding sales tax, as a percent of net sales
94%
96%
Point of sale transactions, excluding sales tax, as a percent of total revenues
92%
94%
Thirty-Nine Weeks Ended
October 30, 2021October 31, 2020
Point of sale transactions, excluding sales tax, as a percent of net sales
93%
96%
Point of sale transactions, excluding sales tax, as a percent of total revenues
91%
94%
Disaggregation of revenue
The following tables summarize the Company’s percentage of net sales disaggregated by category:
Thirteen Weeks Ended
October 30, 2021October 31, 2020
Grocery72 %77 %
General Merchandise & Services12 %13 %
Gasoline and Other16 %10 %
Thirty-Nine Weeks Ended
October 30, 2021October 31, 2020
Grocery71 %78 %
General Merchandise & Services14 %13 %
Gasoline and Other15 %%
v3.21.2
Debt and Credit Arrangements (Tables)
9 Months Ended
Oct. 30, 2021
Debt Disclosure [Abstract]  
Schedule of debt
The following table summarizes the Company’s debt (in thousands):
October 30, 2021January 30, 2021October 31, 2020
ABL Facility$50,000 $310,000 $310,000 
First Lien Term Loan701,920 801,920 801,920 
Unamortized debt discount and debt issuance cost(3,771)(5,745)(6,224)
Less: current portion— (260,000)(260,000)
Long-term debt$748,149 $846,175 $845,696 
v3.21.2
Interest Expense, Net (Tables)
9 Months Ended
Oct. 30, 2021
Other Income and Expenses [Abstract]  
Components of interest expense
The following details the components of interest expense for the periods presented (in thousands):
Thirteen Weeks EndedThirty-Nine Weeks Ended
October 30, 2021October 31, 2020October 30, 2021October 31, 2020
Interest on debt$10,864 $15,915 $34,264 $52,860 
Interest on capital lease and financing obligations966 972 2,947 2,971 
Debt issuance costs amortization544 629 1,649 1,934 
Original issue discount amortization288 477 906 1,535 
Loss on debt extinguishment— 2,794 657 4,077 
Loss (gain) on cash flow hedge(808)5,097 7,146 5,097 
Capitalized interest— (2)(2)(7)
Interest expense, net$11,854 $25,882 $47,567 $68,467 
v3.21.2
Stock Incentive Plans (Tables)
9 Months Ended
Oct. 30, 2021
Share-based Payment Arrangement [Abstract]  
Stock award activity
The following table summarizes the Company’s stock award activity during the thirty-nine weeks ended October 30, 2021 (shares in thousands):
Stock OptionsRestricted StockRestricted Stock UnitsPerformance Stock
SharesWeighted
Average
Exercise
Price
SharesWeighted
Average
Grant
Date Fair
Value
SharesWeighted
Average
Grant
Date Fair
Value
SharesWeighted
Average
Grant
Date Fair
Value
Outstanding, January 30, 20213,673 $17.50 1,575 $26.29 29 $34.54 527 $23.96 
Granted— — 494 44.59 26 46.82 422 44.96 
Forfeited/canceled— — (14)39.76 — — (282)28.98 
Exercised/vested(1,322)13.97 (1,013)29.52 (29)34.60 — — 
Outstanding, October 30, 20212,350 $19.49 1,042 $33.99 26 $46.82 666 $39.56 
v3.21.2
Fair Value Measurements (Tables)
9 Months Ended
Oct. 30, 2021
Fair Value Disclosures [Abstract]  
Gross carrying amount and fair value of debt
The gross carrying amount and fair value of the Company’s debt at October 30, 2021 are as follows (in thousands):
Carrying AmountFair Value
First Lien Term Loan$701,920 $701,857 
ABL Facility50,000 50,000 
Total Debt$751,920 $751,857 
The gross carrying amount and fair value of the Company’s debt at January 30, 2021 are as follows (in thousands):
Carrying AmountFair Value
First Lien Term Loan$801,920 $802,256 
ABL Facility310,000 310,000 
Total Debt$1,111,920 $1,112,256 
The gross carrying amount and fair value of the Company’s debt at October 31, 2020 are as follows (in thousands):
Carrying AmountFair Value
First Lien Term Loan$801,920 $788,800 
ABL Facility310,000 310,000 
Total Debt$1,111,920 $1,098,800 
v3.21.2
Earnings Per Share (Tables)
9 Months Ended
Oct. 30, 2021
Earnings Per Share [Abstract]  
Earnings per share
The table below reconciles basic weighted-average shares of common stock outstanding to diluted weighted-average shares of common stock outstanding for the thirteen and thirty-nine weeks ended October 30, 2021 and October 31, 2020:
Thirteen Weeks EndedThirty-Nine Weeks Ended
October 30, 2021October 31, 2020October 30, 2021October 31, 2020
Weighted-average shares of common stock outstanding, used for basic computation135,581,539 136,011,473 135,603,891 136,269,239 
Plus: Incremental shares of potentially dilutive securities2,423,188 3,048,987 2,684,061 2,734,180 
Weighted-average shares of common stock and dilutive potential shares of common stock outstanding138,004,727 139,060,460 138,287,952 139,003,419 
v3.21.2
Derivative Financial Instruments (Tables)
9 Months Ended
Oct. 30, 2021
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Fair values of derivative instruments by balance sheet location
The fair values of derivative instruments included on the consolidated balance sheets are as follows (in thousands):
Fair Value at
Accounting
for Cash Flow Hedges
Notional AmountFixed RateBalance Sheet ClassificationOctober 30, 2021January 30, 2021October 31, 2020
Interest rate swap$600,000 3.00 %Other current liabilities$(5,952)$(18,828)$(22,670)
Interest rate swap360,000 3.00 %Other current liabilities(13,587)
Interest rate swap240,000 3.00 %Other current liabilities(2,379)(7,525)(9,061)
Net carrying amount$1,200,000 Total liabilities$(8,330)$(26,353)$(45,318)
v3.21.2
Description of Business (Details)
Oct. 30, 2021
state
gas_station
store
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Number of stores | store 222
Number of gas stations | gas_station 151
Number of states in which entity operates | state 17
v3.21.2
Revenue Recognition - Point of Sale Transactions as a Percentage of Net Sales and Total Revenue (Details) - Revenue from Rights Concentration Risk - Point Of Sale Transaction
3 Months Ended 9 Months Ended
Oct. 30, 2021
Oct. 31, 2020
Oct. 30, 2021
Oct. 31, 2020
Net sales        
Concentration Risk [Line Items]        
Concentration risk percentage 94.00% 96.00% 93.00% 96.00%
Total revenue        
Concentration Risk [Line Items]        
Concentration risk percentage 92.00% 94.00% 91.00% 94.00%
v3.21.2
Revenue Recognition - Narrative (Details) - USD ($)
3 Months Ended 9 Months Ended
Oct. 30, 2021
Oct. 31, 2020
Oct. 30, 2021
Oct. 31, 2020
Jan. 30, 2021
Revenue, Major Customer [Line Items]          
Percentage of cash back earned     2.00%    
Maximum annual cash back amount $ 500   $ 500    
Percentage of cash back earned, eligible purchases     5.00%    
Cash back in the form of electronic awards issued     $ 10    
Award liability 29,300,000 $ 24,600,000 29,300,000 $ 24,600,000 $ 25,500,000
Remaining performance obligation 19,100,000 13,500,000 19,100,000 13,500,000 13,500,000
Deferred revenue related to membership fees 13,400,000   13,400,000    
Revenue 4,264,087,000 3,731,669,000 12,309,464,000 11,483,404,000  
Membership          
Revenue, Major Customer [Line Items]          
Deferred revenue related to membership fees $ 168,100,000 151,200,000 168,100,000 151,200,000 155,600,000
Membership fee term 12 months        
Revenue $ 91,493,000 84,946,000 266,634,000 247,001,000  
Gift Card Programs          
Revenue, Major Customer [Line Items]          
Deferred revenue related to membership fees 10,300,000 9,000,000 10,300,000 9,000,000 $ 10,300,000
Revenue $ 8,900,000 $ 9,200,000 $ 27,300,000 $ 28,700,000  
v3.21.2
Revenue Recognition - Percentage of Net Sales Disaggregated by Category (Details)
3 Months Ended 9 Months Ended
Oct. 30, 2021
Oct. 31, 2020
Oct. 30, 2021
Oct. 31, 2020
Grocery        
Disaggregation of Revenue [Line Items]        
Net sales percentage 72.00% 77.00% 71.00% 78.00%
General Merchandise & Services        
Disaggregation of Revenue [Line Items]        
Net sales percentage 12.00% 13.00% 14.00% 13.00%
Gasoline and Other        
Disaggregation of Revenue [Line Items]        
Net sales percentage 16.00% 10.00% 15.00% 9.00%
v3.21.2
Debt and Credit Arrangements - Debt Components (Details) - USD ($)
$ in Thousands
Oct. 30, 2021
Jan. 30, 2021
Oct. 31, 2020
Carrying Amount $ 751,920 $ 1,111,920 $ 1,111,920
Unamortized debt discount and debt issuance cost (3,771) (5,745) (6,224)
Less: current portion 0 (260,000) (260,000)
Long-term debt 748,149 846,175 845,696
ABL Facility      
Carrying Amount 50,000 310,000 310,000
First Lien Term Loan      
Carrying Amount $ 701,920 $ 801,920 $ 801,920
v3.21.2
Debt and Credit Arrangements - Narrative (Details)
9 Months Ended
Jul. 30, 2021
USD ($)
Apr. 30, 2021
USD ($)
Oct. 30, 2020
USD ($)
Oct. 30, 2021
USD ($)
Oct. 31, 2020
USD ($)
Jan. 30, 2021
USD ($)
Carrying amount       $ 751,920,000 $ 1,111,920,000 $ 1,111,920,000
Proceeds from ABL Facility       0 996,000,000  
Cash and cash equivalents   $ 100,000,000   84,691,000 46,116,000 43,518,000
Amortization of debt issuance costs and accretion of original issue discount       2,555,000 3,470,000  
ABL Facility            
Carrying amount       50,000,000 $ 310,000,000 $ 310,000,000
Proceeds from ABL Facility     $ 260,000,000      
Cash and cash equivalents $ 210,000,000   100,000,000      
Repayments of debt $ 210,000,000          
ABL Facility | Term Loan            
Principal amount       $ 50,000,000    
Minimum net leverage ratio for interest rate adjustment       3.00    
Stated interest rate       2.08% 2.14% 2.14%
Repayments of debt   50,000,000        
ABL Facility | Term Loan | London Interbank Offered Rate (LIBOR)            
Decrease in basis spread on variable rate upon achievement of certain net leverage ratio       0.125%    
ABL Facility | Term Loan | London Interbank Offered Rate (LIBOR) | Minimum            
Basis spread on variable rate       2.00%    
ABL Facility | Term Loan | London Interbank Offered Rate (LIBOR) | Maximum            
Basis spread on variable rate       2.50%    
ABL Facility | Term Loan | Base Rate | Minimum            
Basis spread on variable rate       1.00%    
ABL Facility | Term Loan | Base Rate | Maximum            
Basis spread on variable rate       1.50%    
ABL Facility | Revolving Credit Facility            
Maximum borrowing capacity       $ 950,000,000    
Carrying amount       $ 50,000,000 $ 310,000,000 $ 310,000,000
Interest rate at end of period       1.20% 1.27% 1.25%
Unused capacity       $ 930,600,000 $ 670,800,000 $ 641,100,000
ABL Facility | Revolving Credit Facility | London Interbank Offered Rate (LIBOR) | Minimum            
Basis spread on variable rate       1.25%    
ABL Facility | Revolving Credit Facility | London Interbank Offered Rate (LIBOR) | Maximum            
Basis spread on variable rate       1.75%    
ABL Facility | Revolving Credit Facility | Base Rate | Minimum            
Basis spread on variable rate       0.25%    
ABL Facility | Revolving Credit Facility | Base Rate | Maximum            
Basis spread on variable rate       0.75%    
ABL Facility | Letter of Credit            
Carrying amount       $ 19,400,000 21,200,000 15,000,000
First Lien Term Loan            
Minimum net leverage ratio for interest rate adjustment       3.50    
Carrying amount       $ 701,920,000 $ 801,920,000 $ 801,920,000
Cash and cash equivalents   150,000,000 100,000,000      
Repayments of debt   100,000,000 360,000,000      
Amortization of debt issuance costs and accretion of original issue discount   $ 700,000 $ 2,800,000      
Effective interest rate       2.09% 2.15% 2.13%
v3.21.2
Interest Expense, Net (Details) - USD ($)
$ in Thousands
3 Months Ended 9 Months Ended
Oct. 30, 2021
Oct. 31, 2020
Oct. 30, 2021
Oct. 31, 2020
Other Income and Expenses [Abstract]        
Interest on debt $ 10,864 $ 15,915 $ 34,264 $ 52,860
Interest on capital lease and financing obligations 966 972 2,947 2,971
Debt issuance costs amortization 544 629 1,649 1,934
Original issue discount amortization 288 477 906 1,535
Loss on debt extinguishment 0 2,794 657 4,077
Loss (gain) on cash flow hedge (808) 5,097 7,146 5,097
Capitalized interest 0 (2) (2) (7)
Interest expense, net $ 11,854 $ 25,882 $ 47,567 $ 68,467
v3.21.2
Stock Incentive Plans - Narrative (Details) - USD ($)
3 Months Ended 9 Months Ended
Oct. 30, 2021
Jul. 31, 2021
May 01, 2021
Oct. 31, 2020
Aug. 01, 2020
May 02, 2020
Oct. 30, 2021
Oct. 31, 2020
Dec. 19, 2019
Jun. 14, 2018
Jun. 13, 2018
Stock-based compensation expense $ 7,800,000     $ 8,700,000     $ 42,400,000 $ 23,200,000      
Shares reacquired to satisfy tax withholding obligations (in shares) 28,398     6,727     375,223 211,995      
Shares reacquired to satisfy tax withholding obligations $ 1,000,000     $ 100,000     $ 16,700,000 $ 6,500,000      
Shares repurchased $ 72,519,000 $ 55,238,000 $ 24,031,000 50,138,000 $ 38,460,000 $ 6,073,000          
Chief Executive Officer                      
Stock-based compensation expense, modification of stock awards             $ 17,500,000        
The 2011 Plan and 2012 Director Plan                      
Shares reserved for issuance (in shares)                     985,369
Shares available for future issuance (in shares) 5,565,015           5,565,015        
The 2018 Plan                      
Shares authorized for issuance (in shares)                     13,148,058
Employee Stock Purchase Plan                      
Shares reserved for issuance (in shares) 2,177,223           2,177,223        
Stock-based compensation expense $ 200,000     $ 200,000     $ 700,000 $ 500,000      
Shares reserved for issuance (in shares)                   973,014  
Shares reserved for issuance, annual increase (in shares)                   486,507  
Shares reserved for issuance, annual increase percentage                   0.50%  
The Program                      
Share repurchase program, amount authorized                 $ 250,000,000    
Share repurchase program, amount remaining available $ 15,300,000           $ 15,300,000        
Share repurchased (in shares) 1,261,873     1,200,000     2,630,989 2,299,282      
Shares repurchased $ 71,600,000     $ 50,000,000     $ 135,100,000 $ 88,100,000      
v3.21.2
Stock Incentive Plans - Stock Award Activity (Details)
shares in Thousands
9 Months Ended
Oct. 30, 2021
$ / shares
shares
Stock Options  
Shares  
Outstanding (in shares) | shares 3,673
Granted (in shares) | shares 0
Forfeited/canceled (in shares) | shares 0
Exercised/vested (in shares) | shares (1,322)
Outstanding (in shares) | shares 2,350
Weighted Average Exercise Price  
Outstanding (in USD per share) | $ / shares $ 17.50
Granted (in USD per share) | $ / shares 0
Forfeited/canceled (in USD per share) | $ / shares 0
Exercised/vested (in USD per share) | $ / shares 13.97
Outstanding (in USD per share) | $ / shares $ 19.49
Restricted Stock  
Shares  
Outstanding (in shares) | shares 1,575
Granted (in shares) | shares 494
Forfeited/canceled (in shares) | shares (14)
Exercised/vested (in shares) | shares (1,013)
Outstanding (in shares) | shares 1,042
Weighted Average Grant Date Fair Value  
Outstanding (in USD per share) | $ / shares $ 26.29
Granted (in USD per share) | $ / shares 44.59
Forfeited/canceled (in USD per share) | $ / shares 39.76
Exercised/vested (in USD per share) | $ / shares 29.52
Outstanding (in USD per share) | $ / shares $ 33.99
Restricted Stock Units  
Shares  
Outstanding (in shares) | shares 29
Granted (in shares) | shares 26
Forfeited/canceled (in shares) | shares 0
Exercised/vested (in shares) | shares (29)
Outstanding (in shares) | shares 26
Weighted Average Grant Date Fair Value  
Outstanding (in USD per share) | $ / shares $ 34.54
Granted (in USD per share) | $ / shares 46.82
Forfeited/canceled (in USD per share) | $ / shares 0
Exercised/vested (in USD per share) | $ / shares 34.60
Outstanding (in USD per share) | $ / shares $ 46.82
Performance Stock  
Shares  
Outstanding (in shares) | shares 527
Granted (in shares) | shares 422
Forfeited/canceled (in shares) | shares (282)
Exercised/vested (in shares) | shares 0
Outstanding (in shares) | shares 666
Weighted Average Grant Date Fair Value  
Outstanding (in USD per share) | $ / shares $ 23.96
Granted (in USD per share) | $ / shares 44.96
Forfeited/canceled (in USD per share) | $ / shares 28.98
Exercised/vested (in USD per share) | $ / shares 0
Outstanding (in USD per share) | $ / shares $ 39.56
v3.21.2
Income Taxes (Details)
3 Months Ended 9 Months Ended 12 Months Ended
Oct. 30, 2021
Oct. 31, 2020
Oct. 30, 2021
Oct. 31, 2020
Jan. 29, 2022
Income Tax Contingency [Line Items]          
Effective tax rate 20.00% 25.30% 22.60% 24.20%  
Forecast          
Income Tax Contingency [Line Items]          
Effective tax rate         26.80%
v3.21.2
Fair Value Measurements (Details) - USD ($)
$ in Thousands
Oct. 30, 2021
Jan. 30, 2021
Oct. 31, 2020
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]      
Carrying Amount $ 751,920 $ 1,111,920 $ 1,111,920
Fair Value 751,857 1,112,256 1,098,800
First Lien Term Loan      
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]      
Carrying Amount 701,920 801,920 801,920
Fair Value 701,857 802,256 788,800
ABL Facility      
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]      
Carrying Amount 50,000 310,000 310,000
Fair Value $ 50,000 $ 310,000 $ 310,000
v3.21.2
Earnings Per Share - Summary of Basic and Diluted Net Income Per Share Attributable to Common Stockholders (Details) - shares
3 Months Ended 9 Months Ended
Oct. 30, 2021
Oct. 31, 2020
Oct. 30, 2021
Oct. 31, 2020
Earnings Per Share [Abstract]        
Weighted-average shares of common stock outstanding, used for basic computation (in shares) 135,581,539 136,011,473 135,603,891 136,269,239
Plus: Incremental shares of potentially dilutive securities (in shares) 2,423,188 3,048,987 2,684,061 2,734,180
Weighted-average shares of common stock and dilutive potential shares of common stock outstanding (in shares) 138,004,727 139,060,460 138,287,952 139,003,419
v3.21.2
Earnings Per Share - Narrative (Details) - shares
3 Months Ended 9 Months Ended
Oct. 30, 2021
Oct. 31, 2020
Oct. 30, 2021
Oct. 31, 2020
Restricted shares        
Antidilutive securities excluded from computation of diluted earnings per share (in shares) 1,933 1,252 42,483 260,503
Options        
Antidilutive securities excluded from computation of diluted earnings per share (in shares)       368,554
v3.21.2
Derivative Financial Instruments - Narrative (Details)
$ in Thousands
3 Months Ended 9 Months Ended
Jul. 30, 2021
USD ($)
Apr. 30, 2021
USD ($)
Oct. 30, 2020
USD ($)
Nov. 13, 2018
derivative_instrument
Oct. 30, 2021
USD ($)
Oct. 31, 2020
USD ($)
Oct. 30, 2021
USD ($)
Oct. 31, 2020
USD ($)
Jan. 30, 2021
USD ($)
Nov. 10, 2020
USD ($)
Feb. 13, 2019
USD ($)
Derivative [Line Items]                      
Number of derivative instruments entered | derivative_instrument       3              
Amount of hedged item                     $ 1,200,000
Interest rate                     3.00%
Proceeds from ABL Facility             $ 0 $ 996,000      
Cash and cash equivalents   $ 100,000     $ 84,691 $ 46,116 84,691 46,116 $ 43,518    
Gains (losses) reclassified to interest expense $ (3,500) (4,700) $ (3,700)                
Notional amount         1,200,000   1,200,000        
Interest rate swap liability         8,330 45,318 8,330 45,318 $ 26,353    
Derivative gains (losses)         4,600 $ 8,100 12,900 $ (4,500)      
Interest expense         $ 1,800   $ 5,100        
Terminated Interest Rate Swaps                      
Derivative [Line Items]                      
Notional amount                   $ 360,000  
Fixed interest rate                   3.00%  
Ineffective Interest Rate Swap                      
Derivative [Line Items]                      
Notional amount                   $ 240,000  
Fixed interest rate                   3.00%  
ABL Facility                      
Derivative [Line Items]                      
Proceeds from ABL Facility     260,000                
Cash and cash equivalents 210,000   100,000                
Repayments of debt $ 210,000                    
ABL Facility | Term Loan                      
Derivative [Line Items]                      
Repayments of debt   50,000                  
First Lien Term Loan                      
Derivative [Line Items]                      
Cash and cash equivalents   150,000 100,000                
Repayments of debt   $ 100,000 $ 360,000                
v3.21.2
Derivative Financial Instruments - Fair Values of Derivative Instruments (Details) - USD ($)
$ in Thousands
Oct. 30, 2021
Jan. 30, 2021
Oct. 31, 2020
Derivatives, Fair Value [Line Items]      
Notional Amount $ 1,200,000    
Fair Value (8,330) $ (26,353) $ (45,318)
Interest Rate Swap 1      
Derivatives, Fair Value [Line Items]      
Notional Amount $ 600,000    
Fixed Rate 3.00%    
Interest Rate Swap 1 | Other current liabilities      
Derivatives, Fair Value [Line Items]      
Fair Value $ (5,952) (18,828) (22,670)
Interest Rate Swap 2      
Derivatives, Fair Value [Line Items]      
Notional Amount $ 360,000    
Fixed Rate 3.00%    
Interest Rate Swap 2 | Other current liabilities      
Derivatives, Fair Value [Line Items]      
Fair Value $ 0 0 (13,587)
Interest Rate Swap 3      
Derivatives, Fair Value [Line Items]      
Notional Amount $ 240,000    
Fixed Rate 3.00%    
Interest Rate Swap 3 | Other current liabilities      
Derivatives, Fair Value [Line Items]      
Fair Value $ (2,379) $ (7,525) $ (9,061)
v3.21.2
Subsequent Event (Details)
$ in Millions
Nov. 16, 2021
USD ($)
Subsequent Event  
Subsequent Event [Line Items]  
Share repurchase program, amount authorized $ 500.0