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Item 8. Financial Statements and Supplementary Data

2024-03-18 compared with 2023-03-16 · 363 added, 353 removed, 690 unchanged (51% of the section changed)

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INDEX TO FINANCIAL STATEMENTS

Report of Independent Registered Public Accounting Firm (PCAOB ID 238 )

Consolidated Balance Sheets as of January 2 8 , 202 3 and January 29, 2022

Consolidated Statements of Operations and Comprehensive Income for the Fiscal Years Ended January 2 8 , 202 3 , January 29 , 202 2 and January 30, 2021

Consolidated Statements of S tock holders’ Equity (Deficit) for the Fiscal Years Ended January 2 8 , 202 3 , January 29 , 202 2 and January 30, 2021

Consolidated Statements of Cash Flows for the Fiscal Years Ended January 2 8 , 202 3 , January 29 , 202 2 and January 30, 2021

Report of Independent Registered Public Acc ount ing Firm (PCAOB ID 238 )

Consolidated Balan ce Sheets as of Feb ruary 3, 2024 and January 28, 2023

Consolidated Statements of Operations and Comprehensive Income for the Fiscal Years Ended February 3 , 202 4 , January 2 8 , 202 3 and January 29 , 202 2

Consolidated Statements of Stockholders’ Equity for the Fiscal Years Ended February 3 , 202 4 , January 2 8 , 202 3 and January 29 , 202 2

Consolidated Statements of Cash Flows for the Fiscal Years Ended February 3 , 202 4 , January 2 8 , 202 3 and January 29 , 202 2

Notes to Consolidated Financial Statements

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We have audited the accompanying consolidated balance sheets of BJ’s Wholesale Club Holdings, Inc.

and its subsidiaries (the “Company”) as of January 28, 2023 and January 29, 2022, and the related consolidated statements of operations and comprehensive income, of stockholders' equity (deficit) and of cash flows for each of the three years in the period ended January 28, 2023, including the related notes (collectively referred to as the “consolidated financial statements”).

We also have audited the Company's internal control over financial reporting as of January 28, 2023, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of January 28, 2023 and January 29, 2022 , and the results of its operations and its cash flows for each of the three years in the period ended January 28, 2023 in conformity with accounting principles generally accepted in the United States of America.

Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of January 28, 2023, based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO.

and its subsidiaries (the “Company”) as of February 3, 2024 and January 28, 2023, and the related consolidated statements of operations and comprehensive income, of stockholders' equity and of cash flows for each of the three years in the period ended February 3, 2024, including the related notes (collectively referred to as the “consolidated financial statements”).

We also have audited the Company's internal control over financial reporting as of February 3, 2024, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of February 3, 2024 and January 28, 2023 , and the results of its operations and its cash flows for each of the three years in the period ended February 3, 2024 in conformity with accounting principles generally accepted in the United States of America.

Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of February 3, 2024, based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO.

Basis for Opinions

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We believe that our audits provide a reasonable basis for our opinions.

As described in Management’s Report on Internal Control Over Financial Reporting, management has excluded the four distribution centers and the related private transportation fleet acquired from Burris Logistics, LLC, from its assessment of internal control over financial reporting as of January 28, 2023 because the four distribution centers and the related private transportation fleet were acquired by the Company in a purchase business combination during 2022.

We have also excluded the four distribution centers and the related private transportation fleet acquired from Burris Logistics, LLC, from our audit of internal control over financial reporting.

The four distribution centers and the related private transportation fleet acquired from Burris Logistics, LLC whose total assets and total net sales excluded from management’s assessment and our audit of internal control over financial reporting represent 6.2% and 0.4%, respectively, of the related consolidated financial statement amounts as of and for the year ended January 28, 2023.

Definition and Limitations of Internal Control over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

A company’s internal control over financial reporting includes those policies and procedures

that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;

A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;

(ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company;

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Critical Audit Matters

The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that (i) relate to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that (i) relate to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which they relate.

Workers’ Compensation and General Liability Reserves

As described in Notes 2, 16 and 17 to the consolidated financial statements, the Company is primarily self-insured for workers’ compensation and general liability claims.

As of January 28, 2023, workers’ compensation and general liability reserves were a significant portion of insurance reserves of $110.8 million within other non-current liabilities and a significant portion of insurance reserves of $53.2 million within accrued expenses and other current liabilities.

As of February 3, 2024, workers’ compensation and general liability reserves were a significant portion of insurance reserves of $112.3 million within other non-current liabilities and a significant portion of insurance reserves of $60.1 million within accrued expenses and other current liabilities.

The reported reserves for workers’ compensation and general liability claims are derived from estimated ultimate costs based upon individual claim file reserves and estimates for incurred but not reported claims.

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Developing the independent estimate involved (i) testing the completeness and accuracy of underlying data provided by management and (ii) independently developing the loss development factors and applying actuarial methods.

Acquisition of assets and operations of four distribution centers and the related private transportation fleet from Burris Logistics, LLC.

As described in Notes 1 and 19 to the consolidated financial statements, the Company completed its acquisition of the assets and operations of four distribution centers and the related private transportation fleet from Burris Logistics, LLC for total consideration of approximately $375.6 million.

The transaction was accounted for as a business combination.

The most significant items recorded included property and equipment of $203.4 million, merchandise inventories of $88.1 million, and resulting goodwill of $84.7 million.

As disclosed by management, the Company allocated the consideration paid to the identifiable assets, intangible assets and liabilities based on the estimated fair values as of the closing date of the acquisition.

The excess of the fair value of the purchase price over the fair values of these identifiable assets, intangible assets and liabilities was recorded as goodwill.

Management utilized third-party valuation specialists to assist in the determination of the fair value of the assets acquired.

Specifically, the fair value of the buildings and site improvements were determined using a combination of the cost, income and sales comparison approaches.

The methods used to estimate the fair value involved significant assumptions.

The principal considerations for our determination that performing procedures relating to the acquisition of assets and operations of four distribution centers and the related private transportation fleet from Burris Logistics, LLC is a critical audit matter are (i) the significant judgment by management when developing the fair value estimates of the assets acquired;

(ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating audit evidence related to management's fair value estimates of the assets acquired;

and (iii) the audit effort involved the use of professionals with specialized skill and knowledge.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements.

These procedures included testing the effectiveness of controls relating to the acquisition accounting, including controls over management’s valuation of the assets acquired.

These procedures also included, among others, (i) reading the purchase agreement, (ii) testing management’s process for developing the fair value estimates of the assets acquired, (iii) evaluating the appropriateness of the valuation methods, (iv) testing the completeness and accuracy of data used in the valuation methods, (v) testing the accuracy of the purchase price allocation and goodwill recorded, and (vi) testing inventory existence and valuation, including performing physical inventory observations and cost testing.

Professionals with specialized skill and knowledge were used to assist in evaluating (i) the appropriateness of the Company’s valuation methods and (ii) the reasonableness of the significant assumptions.

/s/ PricewaterhouseCoopers LLP

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(Amounts in thousands, except par value)

January 28, 2023 January 29, 2022

February 3, 2024 January 28, 2023

Current assets:

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Operating lease right-of-use assets, net 2,140,482 2,142,925

Property and equipment:

Land and buildings 722,129 430,376

Leasehold costs and improvements 286,591 282,495

Furniture, fixtures, and equipment 1,397,275 1,249,490

Construction in progress 101,724 70,779

2,507,719 2,033,140

accumulated depreciation and amortization ( 1,170,690 ) ( 1,090,809 )

Total property and equipment, net 1,337,029 942,331

Property and equipment, net 1,578,792 1,337,029

Goodwill 1,008,816 1,008,816

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$ 0.01 par value;

300,000 shares authorized, 146,347 shares issued and 133,903 shares outstanding at January 28, 2023;

300,000 shares authorized, 147,544 shares issued and 132,768 shares outstanding at February 3, 2024;

300,000 shares authorized, 146,347 shares issued and 133,903 shares outstanding at January 28, 2023

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Accumulated other comprehensive income 501 1,550

Treasury stock, at cost, 12,444 shares at January 28, 2023 and 9,945 shares at January 29, 2022

Treasury stock, at cost, 14,776 shares at February 3, 2024 and 12,444 shares at January 28, 2023

( 717,765 ) ( 559,221 )

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Fiscal Year Ended

January 28, 2023 January 29, 2022 January 30, 2021

February 3, 2024 January 28, 2023 January 29, 2022

Net sales $ 19,548,011 $ 18,918,435 $ 16,306,365

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Selling, general and administrative expenses 2,822,513 2,668,569 2,446,465

Pre-opening expense 24,933 14,902 9,809

Pre-opening expenses 19,628 24,933 14,902

Operating income 800,419 737,986 617,323

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Income from continuing operations 523,652 514,262 426,760

Loss from discontinued operations, net of income taxes ( 1,085 ) ( 108 ) ( 152 )

Income (loss) from discontinued operations, net of income taxes 89 ( 1,085 ) ( 108 )

Net income $ 523,741 $ 513,177 $ 426,652

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Income from continuing operations $ 3.94 $ 3.84 $ 3.15

Loss from discontinued operations ( 0.01 ) — —

Income (loss) from discontinued operations — ( 0.01 ) —

Net income $ 3.94 $ 3.83 $ 3.15

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Income from continuing operations $ 3.88 $ 3.77 $ 3.09

Loss from discontinued operations ( 0.01 ) — —

Income (loss) from discontinued operations — ( 0.01 ) —

Net income $ 3.88 $ 3.76 $ 3.09

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Diluted 135,118 136,473 138,045

Other comprehensive income:

Other comprehensive (loss) income:

Postretirement medical plan adjustment, net of income tax (benefit) expense of $( 210 ), $ 26 and $( 43 ), respectively

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Unrealized gain on cash flow hedge, net of income tax of $ 0 , $ 229 and $ 4,827 , respectively

588 12,417 10

Total other comprehensive income 245 21,833 6,058

Total other comprehensive (loss) income ( 1,049 ) 245 21,833

Total comprehensive income $ 522,692 $ 513,422 $ 448,485

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BJ’S WHOLESALE CLUB HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT)

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(Amount in thousands)

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Shares Amount Shares Amount

Balance, February 1, 2020 140,723 $ 1,407 $ 773,618 $ ( 716,369 ) $ ( 26,586 ) ( 3,425 ) $ ( 86,414 ) $ ( 54,344 )

Balance, January 30, 2021 143,428 $ 1,434 $ 826,377 $ ( 295,339 ) $ ( 20,528 ) ( 6,236 ) $ ( 192,617 ) $ 319,327

Net income — — — 426,652 — — — 426,652

Postretirement medical plan adjustment, net of tax — — — — ( 33 ) — — ( 33 )

Unrealized gain on cash flow hedge, net of tax — — — — 10 — — 10

Amounts reclassified from accumulated other comprehensive income, net of tax — — — — 6,081 — — 6,081

Other comprehensive income, net of tax — — — — 21,833 — — 21,833

Dividends paid — — ( 25 ) — — — — ( 25 )

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Stock-based compensation expense — — 53,837 — — — — 53,837

Net cash received from stock option exercises — — 17,985 — — — — 17,985

Exercise of stock options — — 18,713 — — — — 18,713

Acquisition of treasury stock — — — — — ( 3,709 ) ( 196,051 ) ( 196,051 )

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Net income — — — 513,177 — — — 513,177

Postretirement medical plan adjustment, net of tax — — — — ( 110 ) — — ( 110 )

Unrealized gain on cash flow hedge, net of tax — — — — 12,417 — — 12,417

Amounts reclassified from accumulated other comprehensive income, net of tax — — — — 9,526 — — 9,526

Other comprehensive income, net of tax — — — — 245 — — 245

Dividends paid — — ( 25 ) — — — — ( 25 )

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Stock-based compensation expense — — 42,617 — — — — 42,617

Net cash received from stock option exercises — — 18,713 — — — — 18,713

Exercise of stock options — — 8,438 — — — — 8,438

Acquisition of treasury stock — — — — — ( 2,499 ) ( 170,553 ) ( 170,553 )

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Net income — — — 523,741 — — — 523,741

Postretirement medical plan adjustment, net of tax — — — — 78 — — 78

Unrealized gain on cash flow hedge, net of tax — — — — 588 — — 588

Amounts reclassified from accumulated other comprehensive income, net of tax — — — — ( 421 ) — — ( 421 )

Other comprehensive loss, net of tax — — — — ( 1,049 ) — — ( 1,049 )

Dividends paid — — ( 25 ) — — — — ( 25 )

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Stock-based compensation expense — — 39,021 — — — — 39,021

Net cash received from stock option exercises — — 8,438 — — — — 8,438

Exercise of stock options — — 2,603 — — — — 2,603

Acquisition of treasury stock — — — — — ( 2,332 ) ( 158,544 ) ( 158,544 )

Balance, January 28, 2023 146,347 $ 1,463 $ 958,555 $ 644,490 $ 1,550 ( 12,444 ) $ ( 559,221 ) $ 1,046,837

Balance, February 3, 2024 147,544 $ 1,475 $ 1,006,409 $ 1,168,231 $ 501 ( 14,776 ) $ ( 717,765 ) $ 1,458,851

The accompanying notes are an integral part of the consolidated financial statements.

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Fiscal Year Ended

January 28, 2023 January 29, 2022 January 30, 2021

February 3, 2024 January 28, 2023 January 29, 2022

CASH FLOWS FROM OPERATING ACTIVITIES

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Stock-based compensation expense 39,021 42,617 53,837

Deferred income tax benefit ( 1,938 ) ( 507 ) ( 9,197 )

Deferred income tax provision (benefit) 25,572 ( 1,938 ) ( 507 )

Changes in operating leases and other non-cash items ( 21,655 ) 27,730 9,226

Increase (decrease) in cash due to changes in:

Accounts receivable ( 60,967 ) ( 1,232 ) 33,634

Accounts receivable, net 10,764 ( 60,967 ) ( 1,232 )

Merchandise inventories ( 76,271 ) ( 47,544 ) ( 37,240 )

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Payments on long-term debt ( 355,041 ) ( 370,655 ) ( 100,000 )

Payments on First Lien Term Loan ( 320,655 ) ( 100,000 ) ( 510,000 )

Proceeds from revolving lines of credit 742,000 1,402,000 —

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Net cash received from stock option exercises 2,603 8,438 18,713

Net cash received from Employee Stock Purchase Program (ESPP) 4,830 3,822 2,676

Net cash received from ESPP 6,267 4,830 3,822

Acquisition of treasury stock ( 155,180 ) ( 172,288 ) ( 194,316 )

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Net cash used in financing activities ( 261,984 ) ( 52,628 ) ( 525,226 )

Net (decrease) increase in cash and cash equivalents ( 11,521 ) 1,918 13,314

Net increase (decrease) in cash and cash equivalents 2,134 ( 11,521 ) 1,918

Cash and cash equivalents, beginning of period 33,915 45,436 43,518

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Property additions included in accrued expenses 38,516 37,629 29,640

Treasury stock repurchases included in accrued expenses 3,364 — 1,735

The accompanying notes are an integral part of the consolidated financial statements.

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BJ’s Wholesale Club Holdings, Inc.

and its wholly-owned subsidiaries (the "Company" or "BJ’s") is a leading warehouse club operator concentrated primarily in the eastern half of the United States.

As of January 28, 2023, BJ’s operated 235 warehouse clubs and 164 gas stations in 18 states.

BJ’s business is moderately seasonal in nature.

Historically, the Company has realized a slightly higher portion of net sales, operating income, and cash flows from operations in the second and fourth fiscal quarters, attributable primarily to the impact of the summer and year-end holiday season, respectively.

The quarterly results have been, and will continue to be, affected by the timing of new club openings and their associated pre-opening expenses.

As a result of these factors, the financial results for any single quarter or for periods of less than a year are not necessarily indicative of the results that may be achieved for a full fiscal year.

Events and global business conditions such as inflation, the coronavirus ("COVID-19") pandemic, and the war in Ukraine have resulted in certain impacts to the global economy, including market disruptions, volatility in fuel costs, and supply chain challenges.

Throughout fiscal year 2022, we continued to experience elevated supply chain costs, including increased commodity prices, logistics, and procurement costs.

We expect these market disruptions and inflationary pressures to continue into fiscal year 2023.

On May 2, 2022, the Company closed the previously announced acquisition of the assets and operations of four distribution centers and the related private transportation fleet from Burris Logistics, LLC.

The Company financed the purchase price with a combination of available cash and borrowings under the ABL Facility.

See Note 1 9 , "Acquisitions" for additional information.

and its wholly-owned subsidiaries (the "Company" or "BJ’s") is a leading operator of membership warehouse clubs concentrated primarily in the eastern half of the United States.

The Company provides a curated assortment focused on grocery, general merchandise, gasoline and other ancillary services, coupons, and promotions to offer a differentiated shopping experience that is further enhanced by its omnichannel capabilities.

As of February 3, 2024, BJ’s operated 243 warehouse clubs and 174 gas stations in 20 states.

Summary of Significant Accounting Policies

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All intercompany balances and transactions have been eliminated in consolidation.

The Company’s fiscal year ends on the Saturday closest to January 31.

Fiscal year 2022 ("2022") consists of the 52 weeks ended January 28, 2023, fiscal year 2021 ("2021") consists of the 52 weeks ended January 29, 2022, and fiscal year 2020 ("2020") consists of the 52 weeks ended January 30, 2021 .

The Company's business, as is 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.

The Company follows the National Retail Federation's fiscal calendar and reports financial information on a 52- or 53-week year ending on the Saturday closest to January 31.

Fiscal year 2023 ("2023") consists of the 53 weeks ended February 3, 2024, fiscal year 2022 ("2022") consists of the 52 weeks ended January 28, 2023, and fiscal year 2021 ("2021") consists of the 52 weeks ended January 29, 2022 .

Fiscal year 2024 ("2024") will consist of the 52 weeks ended February 1, 2025.

Estimates Included in Financial Statements

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, and stockholders’ equity, and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.

The significant estimates relied upon in preparing these consolidated financial statements are estimating workers’ compensation and general liability self-insurance reserves.

The inherent uncertainty of future loss projections could cause actual claims to differ from our estimates.

The significant estimates relied upon in preparing these consolidated financial statements, include but are not limited to, estimating workers’ compensation and general liability self-insurance reserves.

Actual results could differ from those estimates.

Segment Reporting

The Company’s retail operations, which include retail club and other sales procured from our clubs and distribution centers, represent substantially all of the consolidated total revenues, and are the only reportable segment.

All of the Company’s identifiable assets are located in the United States.

Substantially all of the Company’s identifiable assets are located 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 table summarizes the percentage of net sales by category:

Fiscal Year Ended

January 28, 2023 January 29, 2022 January 30, 2021

Grocery 67 % 71 % 77 %

General merchandise and services 12 % 14 % 14 %

Gasoline and other 21 % 15 % 9 %

Refer to Note 4 for a summary of the Company's percentage of net sales disaggregated by category.

Concentration Risk

The Company's clubs are primarily located in the eastern United States.

The Company's clubs are primarily located in the eastern half of the United States.

Sales from the New York metropolitan area comprised approximately 23 %, 21 %, and 23 % of net sales in fiscal years 2023, 2022, and 2021, respectively.

Financial instruments that potentially subject the Company to concentrations of credit risk principally consist of cash held in financial institutions.

Financial instruments that potentially subject the Company to concentrations of credit risk principally consist of cash held in financial institutions to the extent account balances exceed the amount insured by the Federal Deposit Insurance Corporation ("FDIC").

The Company considers the credit risk associated with these financial instruments to be minimal.

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Accounts Receivable

Accounts receivable consists primarily of credit card receivables and receivables from vendors related to rebates and coupons and is stated net of allowances for credit losses of $ 4.4 million and $ 4.9 million at January 28, 2023 and January 29, 2022, respectively.

Accounts receivable consists primarily of credit card receivables and receivables from vendors related to rebates and coupons and is stated net of allowances for credit losses of $ 2.3 million and $ 4.4 million at February 3, 2024 and January 28, 2023, respectively.

The determination of the allowance for credit losses is based on BJ’s historical experience applied to an aging of accounts and a review of individual accounts with a known potential for write-off.

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The Company recognizes the write-down of slow-moving or obsolete inventory in cost of sales when such write-downs are probable and estimable.

The Company writes down inventory for estimated shrinkage for the period between physical inventories based on historical results of previous physical inventories, shrinkage trends, or other judgments management believes to be reasonable under the circumstances.

The Company writes down inventory for estimated shrinkage for the period between physical inventories based on historical results of physical inventories, shrinkage trends, or other judgments management believes to be reasonable under the circumstances.

Property and Equipment

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Property and equipment which is not ready for its intended use is recorded as construction in progress.

Buildings and improvements are depreciated over estimated useful lives of 33 years.

Interest related to the development of buildings is capitalized during the construction period.

Buildings and improvements are generally depreciated over estimated useful lives of 33 years.

Interest and other capitalizable costs related to the development of buildings is capitalized during the construction period.

Leasehold costs and improvements are amortized over the shorter of the remaining lease term, which includes renewal periods that are reasonably assured, or the asset’s estimated useful life.

Furniture, fixtures and equipment are depreciated over their estimated useful lives, ranging from three to ten years .

Depreciation expense was $ 191.7 million, $ 170.1 million, and $ 155.6 million in fiscal years 2022, 2021, and 2020, respectively.

Certain costs incurred in connection with developing or obtaining computer software for internal use are capitalized.

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The Company defers costs directly associated with acquiring third-party financing.

Debt issuance costs related to the term loan are recorded as a direct deduction of the carrying amount of long-term debt, while debt issuance costs associated with the ABL Revolving Facility are recorded within other assets in the consolidated balance sheets.

Debt issuance costs related to the Company's term loan are recorded as a direct deduction of the carrying amount of long-term debt, while debt issuance costs associated with the ABL Revolving Facility are recorded within other assets in the consolidated balance sheets.

Debt issuance costs are amortized over the respective terms of the related financing arrangements on a straight-line basis, which is materially consistent with the effective interest method.

Amortization of deferred debt issuance costs of $ 1.7 million, $ 2.2 million, $ 2.5 million in fiscal years 2022, 2021, and 2020, respectively, included in interest expense, net in the consolidated statements of operations and comprehensive income.

Amortization of deferred debt issuance costs of $ 0.9 million, $ 1.7 million, and $ 2.2 million in fiscal years 2023, 2022, and 2021, respectively, is included in interest expense, net in the consolidated statements of operations and comprehensive income.

Goodwill and Indefinite-Lived Intangible Assets

Goodwill and indefinite-lived trade name intangible assets are not subject to amortization.

The Company assesses the recoverability of its goodwill and trade name annually in the fourth quarter or whenever events or changes in circumstances indicate it may be impaired.

The Company has determined it has one reporting unit for goodwill impairment testing purposes.

The Company assesses the recoverability of its goodwill and trade name annually in the fourth quarter or whenever events or changes in circumstances indicate they may be impaired.

The Company has determined it has one reporting unit for goodwill impairment testing purposes and assessed the recoverability as of December 30, 2023.

The Company may assess its goodwill for impairment initially using a qualitative approach ("step zero") to determine whether conditions exist to indicate that it is more likely than not that the fair value of a reporting unit is less than its carrying value.

If management concludes, based on its assessment of relevant events, facts and circumstances that it is more likely than not that a reporting unit’s carrying value is greater than its fair value, then a quantitative analysis will be performed to determine if there is any impairment.

determine if there is any impairment.

The Company may also elect to initially perform a quantitative analysis instead of starting with step zero.

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Test for Recoverability of Long-Lived Assets

The Company reviews the realizability of long-lived assets periodically and whenever a triggering event occurs that indicates an impairment loss may have been incurred using fair value measurements with unobservable inputs (Level 3).

Current and expected operating results and cash flows and other factors are considered in connection with management’s reviews.

The Company reviews the realizability of long-lived assets periodically and whenever a triggering event occurs that indicates an impairment loss may have been incurred.

Current and expected operating results, cash flows and other factors are considered in connection with management’s review.

For purposes of evaluating the recoverability of long-lived assets, the recoverability test is performed using undiscounted net cash flows of individual clubs and consolidated net cash flows for long-lived assets not identifiable to individual clubs.

Impairment losses are measured as the difference between the carrying amount and the estimated fair value of the assets being evaluated.

In fiscal year 2022, the Company recorded a lease asset impairment charge of $ 1.2 million included in loss from discontinued operations, net of taxes within the consolidated statements of operations and comprehensive income.

The Company did no t record impairment charges in fiscal years 2021 or 2020.

The Company recorded an impairment charge of $ 1.2 million for a lease asset, which is included in loss from discontinued operations, net of taxes within the consolidated statements of operations and comprehensive income in fiscal year 2022.

There were no impairments of lease assets in fiscal years 2023 or 2021.

Asset Retirement Obligations

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The associated estimated asset retirement costs are capitalized in leasehold improvements and depreciated over their useful lives.

The Company’s asset retirement obligations relate to the future removal of gasoline tanks and solar panels installed at leased clubs and the related assets associated with the gas stations and solar panel locations.

The Company’s asset retirement obligations relate to the future removal of gasoline tanks, solar panels, and related assets installed at leased clubs.

See Note 1 5 for further information on the amounts accrued.

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The Company is primarily self-insured for workers’ compensation, general liability claims, and auto liability claims.

Amounts in excess of certain levels, which range from $ 0.3 million to $ 1.0 million per occurrence for workers' compensation

and general liability, and up to $ 2.0 million per occurrence for auto liability, are insured as a risk reduction strategy to mitigate the impact of catastrophic losses on net income.

Amounts in excess of certain levels, which range from $ 0.3 million to $ 1.0 million per occurrence for workers' compensation and general liability, and up to $ 2.0 million per occurrence for auto liability, are insured as a risk reduction strategy to mitigate the financial impact of catastrophic losses.

Reported reserves for claims are derived from estimated ultimate costs based upon individual claim file reserves and estimates for incurred but not reported claims.

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The inherent uncertainty of future loss projections could cause actual claims to differ from the Company's estimates.

When historical losses are not a good measure of future liability, such as in the event of COVID-19, the Company bases its estimates of ultimate liability on its interpretation of current law, claims filed to date, and other relevant factors which are subject to change.

When historical losses are not a good measure of future liability, the Company bases its estimates of ultimate liability on its interpretation of current law, claims filed to date, and other relevant factors which are subject to change.

Accruals for such claims, if any, are included in accrued expenses and other current liabilities and other non-current liabilities in the consolidated balance sheets.

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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.

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 table summarizes 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.

Fiscal Year Ended

January 28, 2023 January 29, 2022 January 30, 2021

Point of sale transactions, excluding sales tax, as a percent of net sales 92 % 93 % 95 %

Point of sale transactions, excluding sales tax, as a percent of total revenues 90 % 91 % 93 %

BJ’s Perks Rewards and My BJ’s Perks programs— The Company’s BJ’s Perks Rewards® membership program, which was in place in fiscal 2022, allowed 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 offered 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 is 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 the Company’s website.

Revenue is recorded at the point-of-sale based on the

transaction price, 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 time of shipment.

Rewards programs

The Company’s BJ’s Perks Rewards membership program which was in place in fiscal 2022 and the first month of fiscal year 2023, allowed 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 offered a co-branded credit card program, the My BJ’s Perks program, which allowed My BJ’s Perks Mastercard credit card holders to earn up to a 10 cent-per-gallon discount on gasoline, up to 5 % cash back on eligible purchases made in BJ’s clubs or online at bjs.com, and up to 2 % cash back on purchases made with the card outside of BJ’s.

Cash back was in the form of electronic awards issued in $ 10 increments that could be used online or in-club and expired 6 months from the date issued.

In the first quarter of fiscal year 2023, the Company rebranded the rewards program.

The former BJ's Perks Rewards membership program is now the Club+ program, whereby participating members earn 2 % cash back, up to a maximum of $ 500 per year, on qualified purchases made at BJs and a 5 cent-per-gallon discount at BJ's gas locations.

Cash back is in the form of electronic awards issued to each member once $ 10 in rewards have been earned.

The Company's co-branded credit card program is now the BJ's One and BJ's One+ program, which allows cardholders with the opportunity to earn up to 5 % cash back on purchases made in BJ's clubs or online at bjs.com and up to a 15 cent-per-gallon discount on gasoline when paying with a BJ's One or BJ's One+ Mastercard at BJ’s gas locations.

Cash back is in the form of electronic awards issued to each member monthly on their credit card statement date.

Earned rewards under these two programs do not expire.

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 $ 34.7 million and $ 30.3 million at January 28, 2023 and January 29, 2022, respectively, and is included in accrued expenses and other current liabilities in the consolidated balance sheets.

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 credit card program was $ 17.9 million and $ 17.8 million at January 28, 2023 and January 29, 2022, respectively, and is included in accrued expenses and other current liabilities in the consolidated balance sheets.

The timing of revenue recognition of these awards is driven by actual customer activities, such as redemptions and expirations.

At January 28, 2023, the Company expects to recognize $ 17.9 million of the deferred revenue in fiscal year 2023.

In connection with the new co-brand credit card program, the Company has deferred approximately $ 18.9 million for funds related to marketing and other integration costs in fiscal 2022.

The Company expects to recognize approximately $ 7.0 million in fiscal year 2023, which is included in accrued expenses and other current liabilities, and $ 11.9 million thereafter, which is included in other non-current liabilities in the consolidated balance sheets.

Membership—The Company charges a membership fee to its customers, which allows customers to shop in the Company’s clubs, shop on the Company’s website and purchase gasoline at the Company’s gas stations for the duration of the

membership, which is generally 12 months.

Earned awards may be redeemed on future purchases made at the Company.

The Company recognizes revenue related to 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 mobile app.

The Company recognizes royalty revenue related to the outstanding My BJ's Perks and BJ's One and BJ's One+ credit card programs based upon actual customer activities, such as reward redemptions.

Additionally, the Company deferred revenue for funds received related to marketing and other integration costs in connection with the new co-brand credit card program and will recognize these funds into revenue as performance obligations are satisfied.

The Company charges a membership fee to its customers, which allows customers to shop in the Company’s clubs, shop on the Company’s website, and purchase gasoline at the Company’s gas stations for the duration of the membership, which is generally 12 months.

In addition, members have access to other ancillary services, coupons, and promotions.

As the Company has the obligation to provide access to its clubs, website, 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 $ 183.7 million and $ 174.9 million at January 28, 2023 and January 29, 2022, respectively, and is included in accrued expenses and other current liabilities in the consolidated balance sheets.

Gift Card Programs—The Company sells BJ’s gift cards that 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 upon redemption of the gift card because the Company’s performance obligation to redeem the gift card for merchandise is satisfied when the gift card is redeemed.

Deferred revenue related to gift cards was $ 14.1 million and $ 11.8 million at January 28, 2023 and January 29, 2022, respectively.

The Company recognized revenue from gift card redemptions of approximately $ 50.1 million in fiscal year 2022, and $ 39.7 million in each of the fiscal years 2021 and 2020.

Gift Card Programs

The Company sells BJ’s gift cards that allow customers to redeem the cards for future purchases equal to the amount of the face value of the gift card.

Revenue from gift card sales is recognized upon redemption of the gift cards and control of the purchased goods or services is transferred to the customer.

Warranty Programs

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The liability for future claims under this program is not material to the financial statements.

Extended warranties are also offered on certain types of products such as appliances, electronics and jewelry.

Extended warranties are also offered on certain types of products such as electronics and jewelry.

These warranties are provided by a third party at fixed prices to BJ’s.

No liability is retained to satisfy warranty claims under these arrangements.

The Company is not the primary obligor under these warranties, and as such net revenue is recorded on these arrangements at the time of sale.

The Company is not the primary obligor under these warranties, and as such net revenue is recorded on these arrangements at

the time of sale.

Revenue from warranty sales is included in net sales in the consolidated statements of operations and comprehensive income.

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The Company has significant experience with return patterns and relies on this experience to estimate expected returns when determining the transaction price.

Returns and Refunds—The Company’s products are generally sold with a right of return and may provide other credits or incentives, which are accounted for as variable consideration when estimating the amount of revenue to recognize.

Returns and Refunds

The Company’s products are generally sold with a right of return and may provide other credits or incentives, which are accounted for as variable consideration when estimating the amount of revenue to recognize.

The Company records an allowance for returns based on current period revenues and historical returns experience.

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The sales returns reserve, which reduces sales and cost of sales for the estimated impact of returns, was $ 5.4 million, $ 6.1 million, and $ 6.7 million in fiscal years 2023, 2022, and 2021, respectively.

Customer Discounts—Discounts given to customers are usually in the form of coupons and instant markdowns and are recognized as redeemed and recorded in contra-revenue accounts, as they are part of the transaction price of the merchandise sale.

Actual sales returns were $ 220.7 million, $ 228.9 million, and $ 215.7 million in fiscal years 2023, 2022 and 2021, respectively.

Customer Discounts

Discounts given to customers are usually in the form of coupons and instant markdowns and are recognized as redeemed and recorded in contra-revenue accounts, as they are part of the transaction price of the merchandise sale.

Manufacturer coupons that are available for redemption at all retailers are not reduced from the sale price of merchandise.

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Significant Judgments

Standalone Selling Prices—For arrangements that contain multiple performance obligations, the Company allocates the transaction price to each performance obligation on a relative standalone selling price basis.

Standalone Selling Prices

For arrangements that contain multiple performance obligations, the Company allocates the transaction price to each performance obligation on a relative standalone selling price basis.

Policy Elections

In addition to those previously disclosed, the Company made the following accounting policy elections and practical expedients:

Portfolio Approach—The Company uses the portfolio approach when multiple contracts or performance obligations are involved in the determination of revenue recognition.

Taxes—The Company excludes from the transaction price any taxes collected from customers that are remitted to taxing authorities.

Shipping and Handling Charges—Charges that are incurred before and after the customer obtains control of goods are deemed to be fulfillment costs.

Time Value of Money—The Company’s payment terms are less than one year from the transfer of goods.

Portfolio Approach

The Company uses the portfolio approach when multiple contracts or performance obligations are involved in the determination of revenue recognition.

The Company excludes from the transaction price any taxes collected from customers that are remitted to taxing authorities.

Shipping and Handling Charges

Charges that are incurred before and after the customer obtains control of goods are deemed to be fulfillment costs.

Time Value of Money

The Company’s payment terms are less than one year from the transfer of goods.

Therefore, the Company does not adjust promised amounts of consideration for the effects of the time value of money.

Disclosure of Remaining Performance Obligations—The Company does not disclose the aggregate amount of the transaction price allocated to remaining performance obligations for contracts that are one year or less in term.

Disclosure of Remaining Performance Obligations

The Company does not disclose the aggregate amount of the transaction price allocated to remaining performance obligations for contracts that are one year or less in term.

Additionally, the Company does not disclose the aggregate amount of the transaction price allocated to remaining performance obligations when the transaction price is allocated entirely to a wholly unsatisfied performance obligation or to a wholly unsatisfied promise to transfer a good or service that forms part of a series of distinct goods or services.

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Presentation of Sales Tax Collected from Customers and Remitted to Governmental Authorities

In the ordinary course of business, sales tax is collected on items purchased by the members that are taxable in the jurisdictions when the purchases take place.

In the ordinary course of business, sales tax is collected on items purchased by the members that are taxable in the jurisdictions when the purchases occur.

These taxes are then remitted to the appropriate taxing authority.

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Vendor Rebates and Allowances

The Company receives various types of cash consideration from vendors, principally in the form of rebates, based on purchasing or selling certain volumes of product, time-based rebates or allowances, which may include product placement allowances or exclusivity arrangements covering a predetermined period of time, price protection rebates and allowances for retail price reductions on certain merchandise and salvage allowances for product that is damaged, defective or becomes out-of-date.

The Company receives various types of cash consideration from vendors, principally in the form of rebates, based on purchasing or selling certain volumes of product;

time-based rebates or allowances, which may include product placement allowances or exclusivity arrangements covering a predetermined period of time;

price protection rebates;

allowances for retail price reductions on certain merchandise;

and salvage allowances for product that is damaged, defective or becomes out-of-date.

Such vendor rebates and allowances are recognized based on a systematic and rational allocation of the cash consideration offered to the underlying transaction that results in progress by BJ’s toward earning the rebates and allowances, provided the amounts to be earned are probable and reasonably estimable.

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Such cash consideration is recognized as a reduction of SG&A to the extent it represents a reimbursement of specific, incremental and identifiable SG&A costs incurred by BJ’s to sell the vendors’ products.

If the cash consideration exceeds the costs being reimbursed, the

excess is characterized as a reduction of cost of sales.

If the cash consideration exceeds the costs being reimbursed, the excess is characterized as a reduction of cost of sales.

Cash consideration for advertising vendors’ products is recognized in the period in which the advertising takes place.

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Right-of-use assets (“lease assets”) represent the right to use an underlying asset for the lease term, and lease liabilities represent the obligation to make lease payments arising from the lease.

Operating lease assets and liabilities are recognized at the commencement date based on the present value of lease payments over the lease term, which reflects options to extend or terminate the lease when it is reasonably certain those options will be exercised.

Operating lease assets and liabilities are recognized at the commencement date based on the present value of lease payments over the lease term, which reflect options to extend or terminate the lease when it is reasonably certain those options will be exercised.

Options to extend have varying rates and terms for each lease.

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The Company is generally obligated for the cost of property taxes, insurance, and maintenance relating to its leases, which are often variable lease payments.

Such costs are presented as occupancy costs for finance and operating leases included in selling, general, and administrative expenses in the consolidated statement of operations and comprehensive income.

Such costs are presented as occupancy costs for finance and operating leases included in SG&A in the consolidated statement of operations and comprehensive income.

Leases with an initial term of twelve months or less are not recorded on the consolidated balance sheets and the related lease expense is recognized on a straight-line basis over the lease term.

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Stock-based Compensation

The fair value of service-based employee awards is recognized as compensation expense on a straight-line basis over the requisite service period of the award.

The fair value of the performance-based awards is recognized as compensation expense ratably over the service period of each performance tranche.

The fair value of the stock-based option awards is determined using the Black-Scholes option pricing model.

Determining the fair value of options at the grant date requires judgment, including estimating the expected term that stock options will be outstanding prior to exercise and the associated volatility.

The fair value of service-based employee awards is recognized as compensation expense on a straight-line basis over the requisite service period of the award, which is typically three years .

The fair value of the performance-based awards is recognized as compensation expense ratably over the service period of each performance tranche, which is typically three years .

Prior to fiscal year 2021, the Company granted stock-based option awards.

The fair value of the stock-based option awards was determined using the Black-Scholes option pricing model.

Determining the fair value of options at the grant date required judgment, including estimating the expected term that stock options would be outstanding prior to exercise and the associated volatility.

The Company’s common stock is listed on the NYSE and its value is determined by the market price on the NYSE.

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Basic income from continuing operations per share is calculated by dividing income from continuing operations by the weighted-average number of shares of common stock outstanding for the period.

Basic loss from discontinuing operations per share is calculated by dividing loss from discontinuing operations by the weighted-average number of shares of common stock outstanding for the period.

Basic income (loss) from discontinued operations per share is calculated by dividing income (loss) from discontinued operations by the weighted-average number of shares of common stock outstanding for the period.

Diluted income per share is calculated by dividing net income available to common stockholders by the diluted weighted-average number of shares of common stock outstanding for the period.

Diluted income from continuing operations per share is calculated by dividing income from continuing operations by the diluted weighted-average number of shares of common stock outstanding for the period.

Diluted loss from discontinuing operations per share is calculated by dividing loss from discontinuing operations by the diluted weighted-average number of shares of common stock outstanding for the period.

Diluted income (loss) from discontinued operations per share is calculated by dividing income (loss) from discontinued operations by the diluted weighted-average number of shares of common stock outstanding for the period.

The Company accounts for income taxes using the asset and liability method.

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The Company evaluates the realizability of its deferred tax assets and establishes a valuation allowance when it is more likely than not that all or a portion of the deferred tax assets will not be realized.

Potential for recovery of deferred tax assets is evaluated by estimating the future taxable profits expected, scheduling of anticipated reversals of taxable temporary differences, and considering prudent and feasible tax planning strategies.

The Company records liabilities for uncertain income tax positions based on a two-step process.

The first step is recognition, where an individual tax position is evaluated as to whether it has a likelihood of greater than 50% of being sustained upon examination based on the technical merits of the position, including resolution of any related appeals or litigation processes.

For tax positions that are currently estimated to have less than a 50% likelihood of being sustained, no tax benefit is recorded.

For tax positions that have met the recognition threshold in the first step, the Company performs the second step of measuring the benefit to be recorded.

The amount of the benefit that may be recognized is the largest amount that has a greater than 50% likelihood of being realized on ultimate settlement.

The actual benefits ultimately realized may differ from the estimates.

In future periods, changes in facts, circumstances and new information may require the Company to change the recognition and measurement estimates regarding individual tax positions.

Changes in recognition and measurement estimates are recorded in income tax expense and liability in the period in which such changes occur.

Any interest or penalties incurred related to unrecognized tax benefits are recorded as a component of the provision for income tax expense.

The timing and amounts of deductible and taxable items and the probability of sustaining uncertain tax positions requires significant judgment.

The Company records the benefits of uncertain tax positions in its consolidated financial statements only after determining a more-likely-than-not probability that the uncertain tax positions will withstand challenge from tax authorities.

The Company periodically reassesses these probabilities and records any changes in the financial statements as appropriate.

Derivative Financial Instruments

All derivatives are recognized as either assets or liabilities on the consolidated balance sheets and measurement of these instruments is at fair value.

If the derivative is designated as a cash flow hedge, the effective portions of changes in the fair value of the derivative are recorded as a component of accumulated other comprehensive income on the consolidated balance sheets and are recognized in the consolidated statements of operations when the hedged item affects earnings.

All derivatives are recognized as either assets or liabilities in the consolidated balance sheets and measured at fair value.

If the derivative is designated as a cash flow hedge, the effective portions of changes in the fair value of the derivative are recorded as a component of accumulated other comprehensive income in the consolidated balance sheets and are recognized in the consolidated statements of operations when the hedged item affects earnings.

Any portion of the change in fair value that is determined to be ineffective is immediately recognized in earnings as SG&A.

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Treasury Stock

The Company records the repurchase of shares of common stock at cost based on the settlement date of the transaction.

These shares are classified as treasury stock, which is a reduction to stockholders’ equity.

Treasury stock is included in authorized and issued shares but excluded from outstanding shares.

Recently Issued Accounting Pronouncements

No accounting pronouncements have been issued recently that are expected to impact the Company's consolidated financial statements.

Recently Adopted Accounting Pronouncements

The Company has not adopted any new accounting pronouncements that had a material impact on the Company’s consolidated financial statements.

The Company accounts for treasury stock under the cost method based on the fair market value of the shares on the dates of repurchase plus any direct costs incurred.

Treasury stock is presented as a reduction to stockholders’ equity and is included in authorized and issued shares but excluded from outstanding shares.

Restructuring Charges

Charges for restructuring programs generally include targeted actions involving employee severance, related benefit costs, and other termination charges.

Employee severance and related benefit costs for employees with no further service period are accounted for under the Company’s ongoing benefit arrangements.

These charges are accrued during the period when management commits to a plan of termination and it becomes probable that employees will be entitled to benefits at amounts that can be reasonably estimated.

For employees with a remaining service period, the related costs are accrued over the period if greater than 60 days.

Restructuring costs are recorded in SG&A in the consolidated statements of operations.

Recently Issued Accounting Pronouncements and Policies

In December 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update (ASU) 2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures.

ASU 2023-09 will require public companies to disclose, on an annual basis, a tabular reconciliation, using both percentages and amounts, broken out into specific categories with certain reconciling items at or above 5% of the statutory tax, further broken out by nature and/or jurisdiction.

ASU 2023-09 requires all entities to disclose, on an annual basis, the amount of income taxes paid (net of refunds received), disaggregated between federal, state/local and foreign, and amounts paid to an individual jurisdiction when 5% or more of the total income taxes paid.

The new standard is effective for fiscal years beginning after December 15, 2024, on a prospective basis.

Early adoption and retrospective application are permitted.

The Company is currently evaluating the impact the adoption of this new pronouncement will have on financial statement disclosures.

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures , which expands the segment reporting disclosures and requires disclosure of segment expenses that are regularly provided to the chief operating decision maker ("CODM") and included within each reported measure of segment profit or loss, amounts and description of its composition for other segment items, and interim disclosure of a reportable segment’s profit or loss and assets.

Additionally, the amendments require the disclosure of the title and position of the CODM and an explanation of how the CODM uses the reported measure(s) of segment profit or loss in assessing performance and deciding how to allocate resources.

The new standard is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, on a retrospective basis.

Early adoption is permitted.

The Company is currently evaluating the impact the adoption of this new pronouncement will have on financial statement disclosures.

Recently Adopted Accounting Pronouncements and Policies

The Company has not adopted any new accounting pronouncements or policies that had a material impact on the Company’s consolidated financial statements.

Related Party Transactions

One of the Company’s suppliers, Advantage Solutions Inc., was determined to be a related party of the Company through June 17, 2022 in fiscal year 2022 as well as in fiscal years 2021 and 2020.

One of the Company’s suppliers, Advantage Solutions Inc., was determined to be a related party of the Company through June 17, 2022 in fiscal year 2022, as well as in fiscal year 2021.

Advantage Solutions Inc.

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Currently, the Company engages them from time to time to provide ancillary support services, including temporary club labor, as needed.

The Company incurred approximately $ 3.1 million, $ 2.9 million, and $ 13.5 million of costs payable to Advantage Solutions for services rendered during fiscal years 2022, 2021 and 2020, respectively.

The Company incurred approximately $ 3.1 million, and $ 2.9 million of costs payable to Advantage Solutions for services rendered during fiscal years 2022 and 2021, respectively.

The demonstration and sampling service fees are fully funded by merchandise vendors who participate in the program.

The Company has operating and finance leases for certain of the Company's clubs and transportation vehicles, and operating leases for certain distribution centers, stand-alone gas stations, and the Club Support Center.

Revenue Recognition

(a) Performance Obligations

The Company identifies each distinct performance obligation to transfer goods (or bundle of goods) or services.

Refer to Note 2 for a description of the Company's performance obligations including net sales, rewards programs, membership and gift card programs.

The following table summarizes 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:

Fiscal Year Ended

February 3, 2024 January 28, 2023 January 29, 2022

Point-of-sale transactions, excluding sales tax, as a percent of net sales 91 % 92 % 93 %

Point-of-sale transactions, excluding sales tax, as a percent of total revenues 89 % 90 % 91 %

( b) Contract Balances

The following tables summarizes the Company's deferred revenue balance related to outstanding performance obligations for contracts with customers:

February 3, 2024 January 28, 2023

Rewards programs:

Earned award dollars $ 49,135 $ 34,676

Royalty revenue 4,593 17,877

Co-brand marketing & integration 4,181 6,960

Total rewards programs 57,909 59,513

Membership 231,440 183,692

Gift card programs 15,290 14,092

E-commerce sales 6,757 2,731

Rewards programs:

Co-brand marketing & integration 6,216 11,895

Total deferred revenue $ 317,612 $ 271,923

Current and long-term deferred revenue balances are included within accrued expenses and other current liabilities and other non-current liabilities, respectively, in the consolidated balance sheets.

The following tables summarizes the Company's revenue recognized during the period that was included in the opening deferred balance as of January 28, 2023:

Fiscal Year Ended

February 3, 2024

Rewards programs:

Earned award dollars $ 34,676

Royalty revenue 17,877

Co-brand marketing & integration 8,213

Total rewards programs 60,766

Membership 183,692

Gift card programs 5,367

E-commerce sales 2,731

Total revenue $ 252,556

Performance obligations related to earned award dollars, royalty revenue, and membership fees are typically satisfied over a period of twelve months or less.

Funds received related to marketing and other integration costs in connection with our co-brand credit card program are recognized as performance obligations are satisfied.

The timing and recognition of gift card redemptions varies depending on consumer behavior and spending patterns.

(d) Disaggregation of Revenue

The Company’s club retail operations, which include retail club and other sales procured from our clubs and distribution centers, represent substantially all of its consolidated total revenues, and are the Company’s only reportable segment.

Substantially all of the Company’s identifiable assets are located 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 table summarizes the Company’s percentage of net sales disaggregated by category:

Fiscal Year Ended

February 3, 2024 January 28, 2023 January 29, 2022

Grocery 70 % 67 % 71 %

General Merchandise and Services 11 % 12 % 14 %

Gasoline and Other 19 % 21 % 15 %

Property and Equipment, Net

The following table summarizes the Company's property and equipment as of February 3, 2024 and January 28, 2023 (in thousands):

Fiscal Year Ended

February 3, 2024 January 28, 2023

Land and buildings $ 871,106 722,129

Leasehold costs and improvements 307,597 286,591

Furniture, fixtures, and equipment 1,505,496 1,397,275

Construction in progress 116,773 101,724

Total property and equipment, gross 2,800,972 2,507,719

accumulated depreciation and amortization ( 1,222,180 ) ( 1,170,690 )

Total property and equipment, net $ 1,578,792 1,337,029

Depreciation expense was $ 219.8 million, $ 191.7 million, and $ 170.1 million in fiscal years 2023, 2022, and 2021, respectively.

The Company has operating and finance leases for certain of the Company's clubs, transportation vehicles, and equipment;

and operating leases for certain distribution centers, stand-alone gas stations, and the Club Support Center.

The initial primary term of the Company’s operating leases ranges from 2 to 44 years, with most of these leases having an initial term of 20 years.

The initial primary term of the Company’s four finance leases ranges from 5 years to 20 years, with most of these leases having an initial term of 20 years.

The following table summarizes the Company’s finance and operating lease liabilities and lease assets as of January 28, 2023 and January 29, 2022 (in thousands):

January 28, 2023 January 29, 2022 Consolidated Balance Sheet Classification

The initial primary term of the Company’s finance leases ranges from 2 years to 20 years, with most of these leases having an initial term of 7 years.

The following table summarizes the Company’s finance and operating lease assets and lease liabilities as of February 3, 2024 and January 28, 2023 (in thousands):

February 3, 2024 January 28, 2023 Consolidated Balance Sheet Classification

Operating lease assets $ 2,140,482 $ 2,142,925 Operating lease right-of-use assets, net

Finance lease assets 33,679 19,283 Land and buildings

finance lease amortization ( 13,555 ) ( 11,706 ) Accumulated depreciation and amortization

Finance lease assets 44,791 33,679 Property and equipment, net

finance lease amortization ( 9,266 ) ( 13,555 ) Property and equipment, net

Total lease assets $ 2,176,007 $ 2,163,049

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Fiscal Year Ended

January 28, 2023 January 29, 2022 January 30, 2021

February 3, 2024 January 28, 2023 January 29, 2022

Finance lease cost:

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(a) Amortization of finance lease assets, operating lease cost, variable lease cost, and sublease income are primarily included in selling, general, and administrative expenses in the consolidated statements of operations and comprehensive income.

Variable lease cost for fiscal year 2022 includes $ 4.8 million of costs incurred to purchase assets deemed to be owned by the lessor of the Company’s Club Support Center and increases in rental payments based on an index.

Variable lease cost primarily consists of increases in rental payments based on an index, and for fiscal year 2022, includes $ 4.8 million of costs incurred to purchase assets deemed to be owned by the lessor of the Company’s Club Support Center.

(b) Interest recognized on finance lease liabilities is included in interest expense, net in the consolidated statements of operations and comprehensive income.

The weighted-average remaining lease term and weighted-average discount rate for operating and finance leases as of January 28, 2023 and January 29, 2022 were as follows:

January 28, 2023 January 29, 2022

The weighted-average remaining lease term and weighted-average discount rate for operating and finance leases as of February 3, 2024 and January 28, 2023 were as follows:

February 3, 2024 January 28, 2023

Weighted-average remaining lease term (in years) - operating leases 11.6 10.4

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Fiscal Year Ended

January 28, 2023 January 29, 2022 January 30, 2021

February 3, 2024 January 28, 2023 January 29, 2022

Operating cash flows paid for operating leases $ 380,340 $ 350,234 $ 325,941

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Fiscal Year Ended

January 28, 2023 January 29, 2022 January 30, 2021

Operating lease liabilities arising from obtaining right-of-use assets $ 220,547 $ 261,228 $ 154,714

February 3, 2024 January 28, 2023 January 29, 2022

Operating lease liabilities arising from obtaining right-of-use assets and other non-cash lease-related operating items $ 177,187 $ 220,547 $ 261,228

Financing lease liabilities arising from obtaining right-of-use assets 22,135 7,443 —

Financing obligations arising from failed sale-leasebacks 3,487 666 —

Future lease commitments to be paid by the Company as of January 28, 2023 were as follows (in thousands):

Future lease commitments to be paid by the Company as of February 3, 2024 were as follows (in thousands):

Fiscal Year Operating Leases Finance Leases

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Present value of lease liabilities $ 2,204,514 $ 34,688

As of January 28, 2023, the Company had certain executed real estate, gas station, and transportation vehicle leases that have not yet commenced and therefore are not reflected in the tables above.

As of February 3, 2024, the Company had certain executed real estate and gas station leases that have not yet commenced and therefore are not reflected in the tables above.

These leases are expected to commence primarily in fiscal year 2024 with lease terms ranging from 7 years to 25 years.

We estimate future lease commitments for these leases to be approximately $ 395.1 million.

Sale-leaseback Transactions

During the fiscal year ended February 3, 2024, the Company completed two sale-leaseback transactions for buildings constructed by the Company on land owned by the buyer-lessors.

In connection with these transactions, the Company sold assets with a total fair value of $ 26.2 million and received proceeds of $ 18.5 million.

The difference between the fair value of assets sold and proceeds received was deemed prepaid rent and included in the operating lease asset at lease commencement.

Failed Sale-leaseback Transactions

During the fiscal year ended February 3, 2024, the Company constructed three buildings on land owned by certain of the Company’s lessors.

The associated leases were deemed to be financing leases, resulting in the Company accounting for the transactions as failed sale-leasebacks.

In connection with these transactions, the Company recorded financing obligations totaling $ 26.4 million, which represented cash received of $ 20.6 million and receivables of $ 5.8 million as of February 3, 2024.

The net book value of the associated building assets is included in property and equipment, net in the consolidated balance sheets.

The current portion of the financing obligations is included in accrued expenses and other current liabilities, while the long-term portion is included in other non-current liabilities in the consolidated balance sheets.

Debt and Credit Arrangements

Debt consisted of the following at January 28, 2023 and January 29, 2022 (in thousands):

January 28, 2023 January 29, 2022

Debt consisted of the following at February 3, 2024 and January 28, 2023 (in thousands):

February 3, 2024 January 28, 2023

ABL Revolving Facility $ 319,000 $ 405,000

ABL Facility — 50,000

First Lien Term Loan 400,000 450,000

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Indebtedness under the ABL Revolving Facility is secured by substantially all of the assets (other than real estate) of the Company and its subsidiaries, subject to customary exceptions.

As amended, interest on the ABL Revolving Facility is calculated either at the Secured Overnight Financing Rate ("SOFR") plus a range of 100 to 125 basis points or a base rate plus 0 to 25 basis points, based on excess availability.

As amended, interest on the ABL Revolving Facility is calculated either at SOFR plus a range of 100 to 125 basis points or a base rate plus 0 to 25 basis points, based on excess availability.

The Company will also pay an unused commitment fee of 20 basis points per annum on the unused ABL Revolving Commitment.

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As of January 28, 2023, there was $ 405.0 million outstanding in loans under the ABL Revolving Facility and $ 11.5 million in outstanding letters of credit.

The interest rate on the revolving credit facility was 5.63 %.

As of February 3, 2024, there was $ 319.0 million outstanding in loans under the ABL Revolving Facility and $ 18.2 million in outstanding letters of credit.

The interest rate on the revolving credit facility was 6.44 %, and unused capacity was $ 802.3 million.

ABL Facility - Former Credit Agreement

The ABL Revolving Facility replaced the ABL Facility, which was comprised of a $ 950.0 million revolving credit facility and a $ 50.0 million term loan.

The ABL Facility was 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.

The $ 50.0 million term loan payment terms were restricted in that the term loan could not be repaid unless all loans outstanding under the ABL Facility are repaid, and once repaid, cannot be re-borrowed.

The availability under the $ 950.0 million revolving credit facility was restricted based on eligible monthly merchandise inventories and receivables as defined in the facility agreement.

Interest on the revolving credit facility was calculated either at the London Interbank Offered Rate ("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 was 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 stepped down by 12.5 basis points upon achieving total net leverage of 3.00 to 1.00.

The ABL Facility also provided a sub-facility for issuance of letters of credit subject to certain fees defined in the ABL Facility agreement.

The ABL Facility was subject to various commitment fees during the term of the facility based on utilization of the revolving credit facility and was scheduled to mature on August 17, 2023.

As of January 29, 2022, there was $ 50.0 million outstanding in borrowings under the ABL Facility and $ 12.7 million in outstanding letters of credit.

Also on that date, the interest rate on the revolving credit facility was 1.23 %, the interest rate on the term loan was 2.10 % and unused capacity was $ 886.9 million.

First Lien Term Loan

On January 5, 2023, the Company entered into an amendment (the “Third Amendment”) to the First Lien Term Loan Credit Agreement, with Nomura Corporate Funding Americas, LLC, as administrative agent and collateral agent and the lenders party thereto.

BofA Securities, Inc., Deutsche Bank Securities Inc., and Wells Fargo Securities LLC acted as joint lead arrangers and joint bookrunners of the Third Amendment.

The Third Amendment, among other things, extends the maturity date with respect to the term loans outstanding under the First Lien Term Loan Credit Agreement from February 3, 2024 to February 3, 2027.

In addition, the Third Amendment transitions the interest rate, effective immediately, from LIBOR to SOFR and changes the applicable margin from LIBOR plus 200 – 225 basis points per annum to SOFR plus 275 basis points per annum.

On October 12, 2023, the Company entered into an amendment (the "Fourth Amendment") to the First Lien Term Loan Credit Agreement, with Nomura Corporate Funding Americas, LLC, as administrative agent and collateral agent and the lenders party thereto.

Deutsche Bank Securities Inc.

acted as the left lead arranger and bookrunner, and Nomura Securities International, Inc., BofA Securities, Inc.

and Wells Fargo Securities LLC acted as joint lead arrangers and joint bookrunners of the Fourth Amendment.

The Fourth Amendment, among other things, extended the maturity date with respect to the term loans outstanding under the First Lien Term Loan Credit Agreement from February 3, 2027 to February 3, 2029.

In addition, the Fourth Amendment reduced applicable margin in respect of the interest rate from SOFR plus 275 basis points per annum to SOFR plus 200 basis points per annum.

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.

As of February 3, 2024, the Company's net leverage ratio did not exceed 3.50 to 1.00, and therefore, no incremental principal payments were required.

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.

Total fees associated with the refinancing were approximately $ 3.2 million.

During fiscal year 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.

During fiscal year 2022, total fees incurred in connection with the Third Amendment were approximately $ 3.2 million.

The Company expensed $ 0.6 million of previously capitalized debt issuance costs and original issue discount and expensed $ 2.0 million of new third-party fees.

The Company deferred $ 1.2 million of new debt issuance costs and original issue discount.

On July 13, 2020, the Company paid $ 150.0 million of the principal amount due on the First Lien Term Loan.

In connection with the payment, the Company expensed $ 1.3 million of previously capitalized deferred debt issuance costs and original issue discount.

On July 29, 2020, due to upgrades in credit ratings, the base rate was reduced to LIBOR plus 200 basis points.

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 due on the First Lien Term Loan.

In connection with the payment, the Company expensed $ 2.8 million of previously capitalized deferred 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.

As of January 29, 2022, there was $ 701.9 million outstanding on the First Lien Term Loan and the interest rate was 2.11 %.

As of January 28, 2023, there was $ 450.0 million outstanding under the First Lien Term Loan, which reflects the Company’s previous repayment of approximately $ 151.9 million of the principal amount outstanding under the First Lien Term Loan Credit Agreement during the fourth quarter of fiscal year 2022 in connection with the Third Amendment.

As of January 28, 2023, there was $ 450.0 million outstanding on the First Lien Term Loan, which reflected the Company’s repayment of approximately $ 151.9 million of the principal amount outstanding under the First Lien Term Loan Credit Agreement during the fourth quarter of fiscal year 2022 prior to the Third Amendment.

The interest rate was 7.11 %.

During fiscal year 2023, total fees incurred in connection with the Fourth Amendment were approximately $ 1.7 million.

The Company expensed $ 1.4 million of previously capitalized debt issuance costs and original issue discount and expensed $ 0.4 million of new third-party fees.

The Company deferred $ 1.3 million of new debt issuance costs.

As of February 3, 2024, there was $ 400.0 million outstanding under the First Lien Term Loan, which reflects the Company’s previous repayment of $ 50.0 million of the principal amount outstanding under the First Lien Term Loan Credit Agreement during the third quarter of fiscal year 2023 prior to the Fourth Amendment.

The interest rate was 7.33 % as of fiscal year end.

Future minimum payments

Scheduled future minimum principal payments on debt as of January 28, 2023 are as follows (in thousands):

Scheduled future minimum principal payments on debt as of February 3, 2024 are as follows (in thousands):

Principal Payments

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Fiscal Year Ended

January 28, 2023 January 29, 2022 January 30, 2021

February 3, 2024 January 28, 2023 January 29, 2022

Interest on debt $ 58,197 $ 37,533 $ 45,124

Interest on financing obligations 4,152 4,269 4,022

Debt extinguishment and refinancing charges 1,830 3,256 657

Amortization of debt issuance costs 914 1,719 2,193

Accretion of original issue discount 329 1,046 1,195

Debt extinguishment and refinancing charges 3,256 657 4,077

(Gain) loss on cash flow hedge ( 165 ) 6,340 6,927

Capitalized interest ( 226 ) ( 196 ) ( 87 )

(Gain) loss on cash flow hedge ( 669 ) ( 165 ) 6,340

Interest expense, net $ 64,527 $ 47,462 $ 59,444

Goodwill and Intangible Assets

The carrying value of goodwill and the change in the balance for the fiscal years ended January 28, 2023 and January 29, 2022 is as follows (in thousands):

The carrying value of goodwill and the change in the balance for the fiscal years ended February 3, 2024 and January 28, 2023 is as follows (in thousands):

Fiscal Year Ended

January 28, 2023 January 29, 2022

February 3, 2024 January 28, 2023

Beginning balance $ 1,008,816 $ 924,134

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Intangible assets consist of the following (in thousands):

January 28, 2023

Gross Carrying Amount Accumulated Amortization Net Amount

February 3, 2024

Gross Carrying Amount Accumulated Amortization Net Carrying Amount

Intangible Assets Not Subject to Amortization:

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January 28, 2023

Gross Carrying Amount Accumulated Amortization Net Amount

Gross Carrying Amount Accumulated Amortization Net Carrying Amount

Intangible Assets Not Subject to Amortization:

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The Company records amortization expense of intangible assets as a component of SG&A.

Member relationships are amortized over 15.3 years and private label brands are amortized over 12 years.

Member relationships will primarily be amortized through fiscal year 2026 and private label brands will be amortized through fiscal year 2023.

The Company recorded amortization expense of $ 9.2 million, $ 10.5 million and $ 11.9 million as a component of SG&A for the fiscal years 2022, 2021, and 2020, respectively.

Member relationships are amortized over 15.3 years and private label brands were amortized over 12 years.

Member relationships will primarily be amortized through fiscal year 2026.

The Company recorded amortization expense of $ 7.9 million, $ 9.2 million and $ 10.5 million as a component of SG&A for fiscal years 2023, 2022, and 2021, respectively.

The Company estimates that amortization expense related to intangible assets will be as follows in each of the next five fiscal years (in thousands):

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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.

The Company does not believe the resolution of any current proceedings will result in a material impact to the consolidated financial statements.

Stock Incentive Plans

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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.

(f/k/a Beacon Holdings, 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").

Prior to the adoption of the 2018 Plan, the Company granted stock-based compensation to employees and non-employee directors, respectively, under the Fourth Amended and Restated 2011 Stock Option Plan of BJ’s Wholesale Club Holdings, Inc., as amended (the "2011 Plan"), and the 2012 Director Stock Option Plan of BJ’s Wholesale Club Holdings, Inc., as amended (the "2012 Director Plan").

No further grants will be made under 2011 Plan or the 2012 Director Plan.

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(1) shares subject to a stock appreciation right ("SAR"), that are not issued in connection with the stock settlement of the SAR on 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 January 28, 2023, there were 5,317,455 shares available for future issuance under the 2018 Plan.

As of February 3, 2024, there were 4,925,874 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.

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In fiscal 2021, the Company recognized $ 17.5 million of stock-based compensation expense due to the accelerated vesting of equity awards, related to the passing of a former executive.

There was no accelerated vesting of awards in fiscal year 2022.

The Company recognized $ 42.6 million, $ 53.8 million, and $ 32.2 million of total stock-based compensation for fiscal years 2022, 2021 and 2020, respectively.

As of January 28, 2023, there was approximately $ 53.9 million o f unrecognized compensation cost, most of which is expected to be recognized over the next three years .

Stock option awards are generally granted with vesting periods of three years .

There was no accelerated vesting of awards in fiscal year 2023 or 2022.

The Company recognized $ 39.0 million, $ 42.6 million, and $ 53.8 million of total stock-based compensation for fiscal years 2023, 2022, and 2021, respectively, inclusive of expense related to the ESPP.

As of February 3, 2024, there was approximately $ 42.5 million o f unrecognized compensation cost, most of which is expected to be recognized over the next three years .

Stock option awards were generally granted with a vesting period of three years .

All options have a contractual term of ten years .

No options were granted during fiscal year 2022 or 2021.

The fair value of the options granted in fiscal year 2020 was estimated using the Black-Scholes option pricing model with the following weighted-average assumptions (no dividends were expected).

Risk-free interest rate 0.44 %

Expected volatility 25.0 %

Weighted-average expected option life (in years) 5.75 - 6.0

Weighted-average grant-date fair value $ 6.16 - $ 6.29

The risk-free interest rate was based on United States Treasury yields in effect at the time of the grant for notes with terms comparable to the awards.

The expected option life represents an estimate of the period of time options are expected to remain outstanding based upon an average of the vesting and contractual terms of the options.

Forfeitures are recorded as incurred.

Presented below is a summary of the stock option activity and weighted-average exercise prices for the fiscal year ended January 28, 2023:

No options were granted during fiscal years 2023, 2022, or 2021.

The fair value of options granted prior to fiscal year 2021 was estimated using the Black-Scholes option pricing model.

Presented below is a summary of the stock option activity and weighted-average exercise prices for the fiscal year ended February 3, 2024:

(Options in thousands) Number of Securities to be Issued Upon Exercise of Outstanding Options Weighted- average Exercise Price Weighted-average Remaining Contractual Life (in years)

Outstanding, beginning of period 1,788 $ 20.35

Forfeited ( 3 ) 25.07

Exercised ( 133 ) 18.09

Outstanding, end of period 1,788 20.35 5.8

Vested and expected to vest, end of period 1,788 20.35 5.8

Exercisable, end of period 1,712 20.14 5.8

Outstanding, vested, and exercisable, end of period 1,655 20.53 4.8

The total intrinsic value of options exercised in fiscal years 2023, 2022 and 2021 was $ 7.2 million, $ 25.1 million, and $ 55.2 million, respectively.

The Company received a tax benefit related to these option exercises of approximately $ 2.0 million, $ 7.0 million, and $ 15.5 million in fiscal years 2023, 2022, and 2021, respectively.

As of January 28, 2023, the total intrinsic value of options vested and expected to vest was $ 88.2 million.

Presented below is a summary of our non-vested restricted shares, restricted stock units and performance stock and weighted-average grant-date fair values for the fiscal year ended January 28, 2023:

As of February 3, 2024, the total intrinsic value of options vested was $ 72.8 million.

Presented below is a summary of our non-vested restricted shares, restricted stock units and performance stock and weighted-average grant-date fair values for the fiscal year ended February 3, 2024:

Restricted Stock Restricted Stock Units Performance Stock

(Shares in thousands) Shares Weighted-average Grant-Date Fair Value Shares Weighted-average Grant-Date Fair Value Shares Weighted-average Grant-Date Fair Value

(Shares in thousands) Shares Weighted-average Grant-Date Fair Value Shares Weighted-average Grant-Date Fair Value Shares (a)

Weighted-average Grant-Date Fair Value

Outstanding, beginning of period 750 $ 50.10 24 $ 58.61 854 $ 45.70

Granted 310 67.43 24 58.61 183 67.54

342 75.58 22 62.13 503 76.07

Forfeited ( 55 ) 65.21 ( 5 ) 58.61 ( 40 ) 58.81

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Outstanding, end of period 621 67.35 22 62.13 677 58.84

As it relates to performance stock, the table above reflects a 100 % payout, however, the actual payout for the fiscal year 2020 grants which vest in the first quarter of fiscal year 2023 is expected to be 200 % and actual payout for performance stock grants in fiscal years 2021 and 2022 could be up to 200 %.

The fair value as of the vesting date was $ 40.5 million for restricted stock and $ 1.5 million for restricted stock units.

(a) Shares presented reflect a 100 % payout, however, the actual payout for the fiscal year 2021 grants, which primarily vest in the first quarter of fiscal year 2024, is expected to be 200 %.

Actual payout for performance stock awards granted in fiscal years 2022 and 2023, which primarily vest in fiscal year 2025 and 2026, respectively, could be below 100 % or up to 200 %.

(b) Includes 320 incremental Performance Stock awards granted in fiscal year 2020 with a weighted-average grant date fair value of $ 33.59 , that vested in the first quarter of fiscal year 2023 at greater than 100 % of target based on performance.

The fair value as of the vesting date was $ 31.4 million, $ 1.2 million and $ 48.6 million for restricted stock, restricted stock units, and performance stock, respectively.

2018 Employee Stock Purchase Plan

On June 14, 2018, the Company’s board of directors adopted and and its stockholders approved the BJ's Wholesale Club Holdings, Inc.

2018 Employee Stock Purchase Plan (the "ESPP"), which became effective the day prior to the first day of public trading of the Company's equity securities.

2018 ESPP, which became effective the day prior to the first day of public trading of the Company's equity securities.

The aggregate number of shares of common stock that was be reserved for issuance under our ESPP was 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.

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The amount of expense recognized in the fiscal years 2023, 2022, and 2021, was $ 1.4 million, $ 1.1 million and $ 0.8 million, respectively.

As of February 3, 2024, there were 2,407,504 shares available for issuance under the ESPP.

Treasury Shares and Share Repurchase Programs

Treasury Shares Acquired on Restricted Stock Awards

Shares reacquired to satisfy tax withholding obligations upon the vesting of restricted stock awards in fiscal year 2022, 2021, and 2020 were 264,167 shares, 376,758 shares and 212,173 shares, respectively.

Treasury Shares Acquired on Restricted Stock Awards and Performance Stock Awards

Shares reacquired to satisfy tax withholding obligations upon the vesting of restricted stock awards and performance stock awards in fiscal year 2023, 2022, and 2021 were 373,875 shares, 264,167 shares, and 376,758 shares, respectively.

These reacquired shares were recorded as $ 28.3 million, $ 18.0 million, and $ 16.8 million of treasury stock in fiscal years 2023, 2022, and 2021, respectively.

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The 2019 Repurchase Program was fully exhausted on November 17, 2021.

On November 16, 2021, the Company’s board of directors approved a new share repurchase program (the "2021 Repurchase Program"), effective immediately, that allows the Company to repurchase up to $ 500.0 million of its outstanding common stock.

On November 16, 2021, the Company’s board of directors approved a share repurchase program (the "2021 Repurchase Program"), effective immediately, that allows the Company to repurchase up to $ 500.0 million of its outstanding common stock.

The 2021 Repurchase Program expires in January 2025.

The Company initiated the 2019 Repurchase Program and the 2021 Repurchase Program to mitigate potentially dilutive effects of stock options and shares of restricted stock granted by the Company, in addition to enhancing stockholder value.

As of January 28, 2023, $ 318.7 million remained available to purchase under the 2021 Repurchase Program.

In fiscal year 2022, the Company repurchased 2,234,708 shares of common stock totaling $ 152.5 million.

As of February 3, 2024, $ 189.3 million remained available to purchase under the 2021 Repurchase Program.

The Company repurchased 1,958,218 , 2,234,708 , and 3,331,956 shares of common stock totaling $ 130.2 million, $ 152.5 million and $ 179.2 million in fiscal years 2023, 2022, and 2021, respectively.

The provision for income taxes from continuing operations includes the following (in thousands):

Fiscal Year Ended

January 28, 2023 January 29, 2022 January 30, 2021

February 3, 2024 January 28, 2023 January 29, 2022

Current $ 126,805 $ 115,270 $ 88,507

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Fiscal Year Ended

January 28, 2023 January 29, 2022 January 30, 2021

February 3, 2024 January 28, 2023 January 29, 2022

Statutory federal income tax rates 21.0 % 21.0 % 21.0 %

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Effective income tax rate 28.8 % 25.5 % 23.5 %

Significant components of the Company’s deferred tax assets and liabilities as of January 28, 2023 and January 29, 2022 are as follows (in thousands):

January 28, 2023 January 29, 2022

Significant components of the Company’s deferred tax assets and liabilities as of February 3, 2024 and January 28, 2023 are as follows (in thousands):

February 3, 2024 January 28, 2023

Deferred tax assets:

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Financing obligations 8,721 6,535

Interest rate swap — 87

Environment clean up reserve 6,169 5,525

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Fiscal Year Ended

January 28, 2023 January 29, 2022

February 3, 2024 January 28, 2023

Balance, beginning of period $ 1,411 $ 2,263

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Balance, end of period $ 2,867 $ 1,411

The total amount of unrecognized tax benefits, reflective of federal tax benefits at both January 28, 2023 and January 29, 2022 that, if recognized, would favorably affect the effective tax rate was $ 1.2 million and $ 2.0 million, respectively.

As of January 28, 2023, management has determined it is reasonably possible that the total amount of unrecognized tax benefits could decrease within the next twelve months by $ 0.1 million, due to the expiration of statute of limitations and expected resolution of state tax audits.

The total amount of unrecognized tax benefits, reflective of federal tax benefits at both February 3, 2024 and January 28, 2023 that, if recognized, would favorably affect the effective tax rate was $ 2.3 million and $ 1.2 million, respectively.

As of February 3, 2024, management has determined it is reasonably possible that the total amount of unrecognized tax benefits could decrease within the next twelve months by $ 0.3 million, due to the expiration of statute of limitations and expected resolution of state tax audits.

The Company’s tax years from 2019 forward remain open and are subject to examination by the Internal Revenue Service or various state taxing jurisdictions.

The Company classifies interest expense and any penalties related to income tax uncertainties as a component of income tax expense.

For fiscal years 2022, 2021, and 2020, the Company recognized no interest income or expense.

As of January 28, 2023 and January 29, 2022, the Company had $ 0.1 million and $ 0.2 million, respectively, of accrued interest related to income tax uncertainties.

The Company recognized $ 0.1 million of expense for fiscal years 2023 and 2022, and no interest income or expense for fiscal year 2021.

As of February 3, 2024 and January 28, 2023, the Company had $ 0.2 million and $ 0.1 million, respectively, of accrued interest related to income tax uncertainties.

Retirement Plans

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The Company’s expense under these plans was $ 15.2 million, $ 13.7 million and $ 11.1 million for fiscal years 2023, 2022, and 2021, respectively.

The Company has a non-contributory defined contribution retirement plan for certain key employees.

Under this plan, the Company funds annual retirement contributions for the designated participants on an after-tax basis.

The Company had a non-contributory defined contribution retirement plan for certain key employees, which was terminated in fiscal year 2023.

Under this plan, the Company funded annual retirement contributions for the designated participants on an after-tax basis.

The Company’s contributions equaled 5 % of the participants’ base salary.

Participants become fully vested in their contribution accounts at the end of the fiscal year in which they complete four full fiscal years of service.

Historically, participants became fully vested in their contribution accounts at the end of the fiscal year in which they completed four full fiscal years of service.

Upon termination of the plan, all remaining contributions became fully vested.

Expense under this plan was $ 0.5 million, $ 3.7 million and $ 1.8 million in fiscal years 2023, 2022, and 2021, respectively.

As of February 3, 2024, the remaining $ 2.2 million due to participants was included in accrued expenses and other current liabilities in the consolidated balance sheets.

Effective January 1, 2024, the Company offers certain qualifying individuals the ability to participate in the NQDC Plan.

The NQDC Plan allows employees to defer up to 50 % of the participant's annual base salary as well as up to 100 % of any annual bonus award.

The Company may also elect to provide a discretionary contribution to the NQDC Plan to certain executives, which will become 100 % vested on the third anniversary of a participant's date of hire.

A participant will be 100 % vested at all times in their elective deferral account within the NQDC Plan.

The Company credits the amounts deferred with earnings and holds investments to offset the Company's liabilities under the NQDC Plan.

As of February 3, 2024, all investments were held in mutual funds.

The NQDC Plan liability and total investments are included in other non-current liabilities and other assets, respectively, in the consolidated balance sheets and were not material as of February 3, 2024.

Additionally, expense under this plan was not material for fiscal year 2023.

Asset Retirement Obligations

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Fiscal Year Ended

January 28, 2023 January 29, 2022 January 30, 2021

February 3, 2024 January 28, 2023 January 29, 2022

Balance, beginning of period $ 23,336 $ 21,378 $ 19,329

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The major components of accrued expenses and other current liabilities are as follows (in thousands):

January 28, 2023 January 29, 2022

February 3, 2024 January 28, 2023

Deferred membership fee income $ 231,440 $ 183,692

Employee compensation 128,483 141,863

Outstanding checks and payables 113,474 104,903

Insurance reserves 53,183 48,379

BJ’s Perks rewards 51,114 40,804

Employee compensation and benefits 87,765 129,125

Sales, property, use and other taxes 63,294 60,954

Fixed asset accruals 37,629 29,640

Deferred revenues 30,920 27,717

Utilities, advertising and accrued interest 23,138 21,699

Insurance reserves 60,097 53,183

Fixed asset accruals and property-related costs 58,930 61,992

Rewards programs and related deferred revenues 57,909 59,513

Deferred revenues and vendor income 29,396 22,521

Professional services and advertising 21,764 18,220

Legal, sales, and membership fee reserves 17,165 17,518

Gift cards 15,290 14,092

Repairs and common area maintenance 11,374 10,174

Professional services 11,311 8,251

Accrued federal and state income taxes 10,950 10,875

Other 55,612 41,698

2 unchanged sentences

Fiscal Year Ended

January 28, 2023 January 29, 2022

February 3, 2024 January 28, 2023

Deferred membership fee income, beginning of period $ 183,692 $ 174,916

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The major components of other non-current liabilities are as follows (in thousands):

January 28, 2023 January 29, 2022

February 3, 2024 January 28, 2023

Insurance reserves $ 112,273 $ 110,777

Co-brand deferred revenue and other 32,549 22,082

Financing obligations (see Note 6 )

62,494 27,415

Asset retirement obligations 26,360 23,336

Financing obligations 27,415 14,816

Deferred revenues 20,641 24,641

Other 4,867 7,908

Total other non-current liabilities $ 226,635 $ 194,077

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 were effective starting on February 13, 2019 and fixed the LIBOR component of $ 1.2 billion of its floating rate debt at a rate of approximately 3.0 % from February 13, 2019 until 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.

Due to the payment of debt principal on the First Lien Term Loan, the Company determined that certain interest payments are no longer probable and that a portion of one of the interest rate swap agreements would be ineffective as a result of the payment of debt principal, and as such reclassified $ 5.1 million of losses recorded in accumulated other comprehensive income to interest expense.

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 3.0 % was determined to be ineffective.

Gains and losses on the ineffective interest rate swap agreement w recorded as interest expense.

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 reclassification of unrealized losses into earnings on the ineffective interest rate swap agreements and reclassified $ 4.7 million recorded in accumulated 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 reclassification of unrealized losses into earnings on the ineffective interest rate swap agreements and reclassified $ 3.5 million recorded in accumulated other comprehensive income to interest expense, net of tax.

The interest rate swaps expired in February 2022.

There was no liability recorded as of January 28, 2023 and $ 2.2 million recorded as of January 29, 2022.

The net of tax amount for the effective and ineffective Interest Rate Swaps was recorded in other comprehensive income and interest expense, respectively.

The fair value of derivative instruments included on the consolidated balance sheets are as follows (in thousands):

Accounting for Cash Flow Hedges Notional Amount Fixed Rate Balance Sheet Classification January 28, 2023 January 29, 2022

Interest rate swap $ 600,000 3.00 % Accrued expenses and other current liabilities $ — $ ( 1,540 )

Interest rate swap 360,000 3.00 % Accrued expenses and other current liabilities — —

Interest rate swap 240,000 3.00 % Accrued expenses and other current liabilities — ( 616 )

Net carrying amount $ 1,200,000 Total liabilities $ — $ ( 2,156 )

Fair Value Measurements

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As such, the estimated fair value of long-term debt is classified within Level 2, as defined under U.S.

The gross carrying amount and fair value of the Company’s debt at January 28, 2023 are as follows (in thousands):

The gross carrying amount and fair value of the Company’s debt at February 3, 2024 are as follows (in thousands):

Carrying Amount Fair Value

First Lien Term Loan $ 450,000 $ 450,482

ABL Revolving Facility $ 319,000 $ 319,000

First Lien Term Loan 400,000 401,168

Total Debt $ 719,000 $ 720,168

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Carrying Amount Fair Value

ABL Revolving Facility $ 405,000 $ 405,000

First Lien Term Loan 450,000 450,482

ABL Facility 50,000 50,000

Total Debt $ 855,000 $ 855,482

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See Note 2 for further information.

The Company believes that the carrying amounts of its other financial instruments, including cash, accounts receivable, and accounts payable approximate their carrying value due to the short-term maturities of these instruments.

The Company believes that the carrying amounts of its other financial instruments, including cash, accounts receivable, and accounts payable approximate their fair values due to the short-term maturities of these instruments.

Earnings Per Share

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Fiscal Year Ended

January 28, 2023 January 29, 2022 January 30, 2021

February 3, 2024 January 28, 2023 January 29, 2022

Weighted-average shares of common stock outstanding, used for basic computation 133,047 134,017 135,386

Incremental shares of potentially dilutive securities:

Stock incentive awards 2,456 2,659 2,765

2,071 2,456 2,659

Weighted-average shares of common stock and dilutive potential shares of common stock outstanding 135,118 136,473 138,045

The table below summarizes restricted shares and stock options that were excluded from the computation of diluted earnings for fiscal years 2022, 2021, and 2020 as their inclusion would have been anti-dilutive (in thousands):

The table below summarizes awards that were excluded from the computation of diluted earnings for fiscal years 2023, 2022, and 2021 as their inclusion would have been anti-dilutive (in thousands):

Fiscal Year Ended

January 28, 2023 January 29, 2022 January 30, 2021

Restricted shares 75 32 207

Stock options — — 276

February 3, 2024 January 28, 2023 January 29, 2022

Stock-based awards 228 75 32

On May 2, 2022, the Company completed the Acquisition to bring substantially all of its end-to-end perishable supply chain in-house.

The total consideration paid by the Company in connection with the Acquisition was approximately $ 375.6 million, excluding transaction costs.

The Company did no t record any transaction costs for the fiscal year ended February 3, 2024.

For the fiscal year ended January 28, 2023, the Company recorded transaction and integration costs related to the Acquisition of $ 12.3 million.

These costs are included in selling, general and administrative expenses in the consolidated statements of operations and comprehensive income.

The following table summarizes the consideration paid and the fair values of the assets acquired and liabilities assumed (in thousands) in connection with the Acquisition:

The following table summarizes the consideration paid and the final fair values of the assets acquired and liabilities assumed in connection with the Acquisition (in thousands):

As of May 2, 2022

Initial fair value (a)

Adjustments Updated fair value

Property and equipment, net $ 203,400

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Total consideration paid, including working capital adjustments $ 375,581

(a) Initial fair value disclosed in our Quarterly Report on Form 10-Q for the period ended July 30, 2022, filed with the SEC on August 26, 2022

Goodwill represents the excess of the purchase price over the net identifiable assets acquired and liabilities assumed.

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For the fiscal year ended January 28, 2023, the Acquisition generated an incremental $ 66.8 million in revenue.

It is impracticable to provide historical supplemental pro forma financial information along with earnings during the period subsequent to the Acquisition due to a variety of factors, including access to historical information and the operations of acquirees being integrated within the Company shortly after closing and not operating as discrete entities within the Company’s organizational structure.

It is impracticable to provide historical supplemental pro forma financial information along with earnings during the period subsequent to the Acquisition due to a variety of factors, including access to historical information and the operations of acquiree being integrated within the Company shortly after closing and not operating as discrete entities within the Company’s organizational structure.

Condensed Financial Information of Registrant (Parent Company Only)

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(Amounts in thousands)

January 28, 2023 January 29, 2022

February 3, 2024 January 28, 2023

Investment in subsidiaries $ 1,458,851 $ 1,046,837

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$ 0.01 par value;

300,000 shares authorized, 146,347 shares issued and 133,903 shares outstanding at January 28, 2023;

300,000 shares authorized, 147,544 shares issued and 132,768 shares outstanding at February 3, 2024;

300,000 shares authorized, 146,347 shares issued and 133,903 shares outstanding at January 28, 2023

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Retained earnings 1,168,231 644,490

Treasury stock, at cost, 12,444 shares at January 28, 2023 and 9,945 shares at January 29, 2022

Treasury stock, at cost, 14,776 shares at February 3, 2024 and 12,444 shares at January 28, 2023

( 717,765 ) ( 559,221 )

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Fiscal Year Ended

January 28, 2023 January 29, 2022 January 30, 2021

February 3, 2024 January 28, 2023 January 29, 2022

Equity in net income of subsidiaries $ 523,741 $ 513,177 $ 426,652

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A statement of cash flows has not been presented as BJ’s Wholesale Club Holdings, Inc.

did not have any cash as of, or for, the years ended January 28, 2023, January 29, 2022, or January 30, 2021.

did not have any cash as of, or for, the years ended February 3, 2024, January 28, 2023, or January 29, 2022.

Basis of Presentation

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The ability of BJ’s Wholesale Club Holdings, Inc.’s operating subsidiaries to pay dividends may be restricted due to terms of the subsidiaries’ First Lien Term Loan and ABL Revolving Facility, as defined in Note 7 .

For example, the covenants of the ABL Revolving Facility restrict the payment of dividends to, among other exceptions, (i) a greater of $ 135.0 million or 15.0 % of trailing 12 months EBITDA general basket, (ii) a basket for unlimited dividends and distributions if there is no specified event of default and either (x) (A) availability under the ABL Revolving Facility is not less than 17.5 % of the lesser of the commitments under the ABL Revolving Facility and the borrowing base under the ABL Revolving Facility for the 30 consecutive day period ending immediately prior to such dividend or distribution and (B) availability under the ABL Revolving Facility is not less than 17.5 % of the lesser of the commitments under the ABL Revolving Facility and the borrowing base under the ABL Revolving Facility on the date of such dividend or distribution or (y) (A) availability under the ABL Revolving Facility is not less than 12.5 % of the lesser of the commitments under the ABL Revolving Facility and the borrowing base under the ABL Revolving Facility for the 30 consecutive day period ending immediately prior to such dividend or distribution, (B) availability under the ABL Revolving Facility is not less than 12.5 % of the lesser of the commitments under the ABL Revolving Facility and the borrowing base under the ABL Revolving Facility on the date of such dividend or distribution and (C) the fixed charge coverage ratio as of the end of the most recently ended fiscal quarter for which financial statements are available is not less than 1.00 to 1.00, and (iii) ) a basket for up to 7.0 % per annum of the market capitalization of BJ’s Wholesale Club Holdings, Inc if there is no event of default.

the 30 consecutive day period ending immediately prior to such dividend or distribution, (B) availability under the ABL Revolving Facility is not less than 12.5 % of the lesser of the commitments under the ABL Revolving Facility and the borrowing base under the ABL Revolving Facility on the date of such dividend or distribution and (C) the fixed charge coverage ratio as of the end of the most recently ended fiscal quarter for which financial statements are available is not less than 1.00 to 1.00, and (iii) ) a basket for up to 7.0 % per annum of the market capitalization of BJ’s Wholesale Club Holdings, Inc if there is no event of default.

The covenants of the First Lien Term Loan restrict the payment of dividends and distributions to, among other exceptions, (i) a $ 25.0 million general basket, (ii) a basket for unlimited dividends and distributions if no event of default exists and the pro-forma total net leverage ratio is less than or equal to 4.25 to 1.00, (iii) a "growing" basket based on, among other things, retained excess cash flow subject to no event of default and compliance with a pro-forma interest coverage ratio of greater than or equal to 2.00 to 1.00, and (iv) a basket for 6.0 % per annum of the net cash proceeds received from such qualified IPO that are contributed to the borrower in cash.

As of January 28, 2023, the amount of net income free of such restrictions and available for payment by BJ’s Wholesale Club Holdings, Inc.

As of February 3, 2024, the amount of net income free of such restrictions and available for payment by BJ’s Wholesale Club Holdings, Inc.

as dividends, was $ 523.7 million, and the total amount of restricted net assets of consolidated subsidiaries of BJ’s Wholesale Club Holdings, Inc.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data