- Q4 consolidated comparable store sales increase of 6%, well
above the Company’s guidance of a 2% to 3% increase, and over last
year’s 6% growth
- Q4 diluted EPS of $.81, well above the Company’s guidance of
$.74 to $.76, and a 19% increase over last year’s $.68
- Customer traffic was the primary driver of the comp store sales
increase at all four major divisions for Q4 and FY20
- Q4 net sales increased 10% to $12.2 billion
- FY20 consolidated comp store sales increase of 4%, above the
Company’s guidance of a 3% increase, and over last year’s 6%
growth
- FY20 diluted EPS of $2.67, above the Company’s guidance of
$2.61 to $2.63
- FY20 net sales increased 7% to $41.7 billion
- Returned $2.6 billion to shareholders in FY20 through share
repurchases and dividends
- Provides FY21 guidance
The TJX Companies, Inc. (NYSE: TJX), the leading off-price
apparel and home fashions retailer in the U.S. and worldwide, today
announced sales and earnings results for the fourth quarter ended
February 1, 2020. Net sales for the fourth quarter of Fiscal 2020
increased 10% to $12.2 billion. Consolidated comparable store sales
increased 6% over a 6% increase last year. Net income for the
fourth quarter was $985 million. Diluted earnings per share were
$.81, a 19% increase versus the prior year’s $.68.
For the 52-week fiscal year ending February 1, 2020, net sales
were $41.7 billion, a 7% increase over the same period last year.
Consolidated comparable store sales increased 4% over a 6% increase
last year. Net income was $3.3 billion, and diluted earnings per
share were $2.67, a 10% increase versus $2.43 in the prior year.
Fiscal 2020 diluted earnings per share increased 9% over the prior
year’s adjusted $2.45, which excluded a $.02 pension settlement
charge.
CEO and President
Comments
Ernie Herrman, Chief Executive Officer and President of The TJX
Companies, Inc., stated, “We are extremely pleased with our strong
fourth quarter results, as both sales and earnings per share
significantly exceeded our expectations. Fourth quarter
consolidated comparable store sales increased a very strong 6%,
over a 6% increase last year. We saw strength across the Company,
with each major division delivering comp sales growth of 4% or
higher, all over strong increases last year and all primarily
driven by customer traffic. Our exciting brands and gift-giving
assortments at great values, supported by our marketing, attracted
customers around the globe during the holiday season and beyond.
Fourth quarter earnings per share of $.81 were also well above our
guidance.”
Herrman continued, “As to the full year, we also delivered
strong results. Consolidated comparable store sales were up 4% over
a 6% increase last year, marking our 24th consecutive year of comp
sales growth. We are also very proud to well surpass $40 billion in
annual sales, a tremendous milestone for our Company. Full-year
earnings per share also exceeded our guidance. I want to recognize
the terrific efforts of our Associates throughout the year, who
bring our business to life every day for consumers, and the support
of our customers, vendors, communities, and shareholders. Looking
ahead to 2020, the year is off to a solid start and our global
organization remains focused on bringing great values to shoppers
every day. We see plentiful opportunities for TJX in today’s retail
landscape and are confident we will continue to capture market
share. We look forward to many more successful years ahead and
continued growth around the world!”
Shareholder
Distributions
During the fourth quarter, the Company returned a total of $631
million to shareholders. The Company repurchased a total of $355
million of TJX stock, retiring 5.9 million shares, and paid $276
million in shareholder dividends. In Fiscal 2020, the Company
returned a total of $2.6 billion to shareholders. The Company
repurchased a total of $1.5 billion of TJX stock, retiring 27.1
million shares, and paid $1.1 billion in shareholder dividends.
With the Company’s continued strong cash flow, TJX announced
today that it intends to increase the regular quarterly dividend on
its common stock to be declared in March 2020 and payable in June
2020 to $.26 per share, subject to the approval of the Company’s
Board of Directors. This would represent a 13% increase in the
current per share dividend and mark the 24th consecutive year that
the Company has raised the dividend.
The Company is also announcing today its plan to repurchase
approximately $1.75 to $2.25 billion of TJX stock during the fiscal
year ending January 30, 2021. With $1.7 billion remaining at Fiscal
2020 year end under the Company’s existing stock repurchase
programs, the Company’s Board of Directors approved a new stock
repurchase program that authorizes the repurchase of up to an
additional $1.5 billion of TJX common stock from time to time. The
new authorization represents approximately 2% of the Company’s
outstanding shares at current prices. The new stock repurchase
program marks the 21st program approved by the Board since 1997.
Under the Company’s repurchase plans, share repurchases may be made
from time to time in market or private transactions and may include
derivative transactions. The repurchase program announced today has
no time limit and may be suspended or discontinued at any time.
Ernie Herrman commented, “Our business continues to generate
large amounts of cash and deliver strong financial returns. In
2020, we plan to continue investing to support the growth of TJX
while continuing our long history of distributing cash to our
shareholders. Our capital spending plans include investing in new
stores, store remodels, and our supply chain and infrastructure. At
the same time, we’re planning a strong increase to our regular
quarterly dividend and a continuation of our significant buyback
program. These actions demonstrate our confidence in our ability to
continue delivering strong, profitable sales and cash flow that
enables us to both fund our continued growth and return value to
our shareholders.”
Sales by Business
Segment
The Company’s comparable store sales and net sales by division,
in the fourth quarter and full year, were as follows:
Fourth Quarter
Fourth Quarter
Comparable Store
Sales1,2
Net Sales ($ in
millions)3,4
FY2020
FY2019
FY2020
FY2019
Marmaxx (U.S.)5,6
+6%
+7%
$7,402
$6,856
HomeGoods (U.S.)7
+5%
+5%
$1,952
$1,727
TJX Canada
+4%
+4%
$1,135
$1,041
TJX International (Europe &
Australia)
+10%
+5%
$1,718
$1,503
TJX
+6%
+6%
$12,206
$11,127
Full Year
Full Year
Comparable Store
Sales1,2
Net Sales ($ in
millions)3,4
FY2020
FY2019
FY2020
FY2019
Marmaxx (U.S.)5,6
+5%
+7%
$25,665
$24,058
HomeGoods (U.S.)7
+2%
+4%
$6,356
$5,787
TJX Canada
+2%
+4%
$4,031
$3,870
TJX International (Europe &
Australia)
+8%
+3%
$5,665
$5,258
TJX
+4%
+6%
$41,717
$38,973
1Comparable store sales outside the U.S. calculated on a
constant currency basis, which removes the effect of changes in
currency exchange rates. 2Comparable store sales exclude e-commerce
sites (tjmaxx.com, marshalls.com, sierra.com, and tkmaxx.com) and
include Sierra stores. 3Net sales in TJX Canada and TJX
International include the impact of foreign currency exchange
rates. See below. 4Figures may not foot due to rounding.
5Combination of T.J. Maxx and Marshalls. 6Net sales include
Sierra’s e-commerce and store sales. 7Includes Homesense stores in
the U.S.
Impact of Foreign Currency Exchange
Rates
Changes in foreign currency exchange rates affect the
translation of sales and earnings of the Company’s international
businesses into U.S. dollars for financial reporting purposes. In
addition, ordinary course, inventory-related hedging instruments
are marked to market at the end of each quarter. Changes in
currency exchange rates can have a material effect on the magnitude
of these translations and adjustments when there is significant
volatility in currency exchange rates.
The movement in foreign currency exchange rates had a neutral
impact on consolidated net sales growth in the fourth quarter of
Fiscal 2020 versus the prior year. The overall net impact of
foreign currency exchange rates had a $.01 positive impact on
fourth quarter Fiscal 2020 earnings per share, compared with a $.01
negative impact last year.
The movement in foreign currency exchange rates had a one
percentage point negative impact on consolidated net sales growth
in Fiscal 2020 versus the prior year. The overall net impact of
foreign currency exchange rates had a $.01 negative impact on
Fiscal 2020 earnings per share, compared with a neutral impact last
year.
A table detailing the impact of foreign currency on TJX’s pretax
earnings and margins, as well as those of its international
businesses, can be found in the Investors section of TJX.com.
The foreign currency exchange rate impact to earnings per share
does not include the impact currency exchange rates have on various
transactions, which the Company refers to as “transactional foreign
exchange.”
Margins
For the fourth quarter of Fiscal 2020, the Company’s
consolidated pretax profit margin was 10.9% versus 10.6% in the
prior year.
Gross profit margin for the fourth quarter of Fiscal 2020 was
28.4%, a 0.6 percentage point increase versus the prior year. The
Company’s merchandise margin was up significantly. Selling, general
and administrative (SG&A) costs as a percent of sales for the
fourth quarter were 17.5%, a 0.3 percentage point increase versus
the prior year.
For the full year Fiscal 2020, the Company’s consolidated pretax
profit margin was 10.6%. This was a 0.1 percentage point decrease
versus the prior year’s 10.7% and a 0.2 percentage point decrease
versus the prior year’s adjusted 10.8%, which excluded a negative
0.1 percentage point impact from a pension settlement charge.
Gross profit margin for the full year Fiscal 2020 was 28.5%, a
0.1 percentage point decrease versus the prior year. Selling,
general and administrative (SG&A) costs as a percent of sales
for the full year were 17.9%, a 0.1 percentage point increase
versus the prior year.
Inventory
Total inventories as of February 1, 2020, were $4.9 billion,
compared with $4.6 billion at the end of the prior fiscal year.
Consolidated inventories on a per-store basis as of February 1,
2020, including the distribution centers, but excluding inventory
in transit, the Company’s e-commerce sites, and Sierra stores, were
up 4% on a reported and constant currency basis. The Company enters
the new fiscal year in an excellent inventory position and is
well-positioned to continue shipping fresh, spring merchandise to
its stores and take advantage of the fantastic buying opportunities
it sees in the marketplace.
Full Year and First Quarter Fiscal 2021
Outlook
For the 52-week fiscal year ending January 30, 2021, the Company
expects diluted earnings per share to be in the range of $2.77 to
$2.83. This would represent a 4% to 6% increase over the prior
year’s $2.67. This EPS outlook is based upon estimated comparable
store sales growth of 2% to 3% on both a consolidated basis and at
Marmaxx.
For the first quarter of Fiscal 2021, the Company expects
diluted earnings per share to be in the range of $.59 to $.60
versus earnings per share of $.57 in the prior year. This EPS
outlook is based upon estimated comparable store sales growth of 2%
to 3% on both a consolidated basis and at Marmaxx.
The Company’s earnings guidance for the first quarter and
full-year Fiscal 2021 assumes that currency exchange rates will
remain unchanged from the levels at the beginning of the first
quarter.
Stores by Concept
During the fiscal year ended February 1, 2020, the Company
increased its store count by 223 stores to a total of 4,529 stores.
The Company increased square footage by 4% over the same period
last year.
Store Locations1
Gross Square Feet2
FY2020
FY2020
(in millions)
Beginning
End
Beginning
End
In the U.S.:
T.J. Maxx
1,252
1,273
34.5
34.9
Marshalls
1,091
1,130
31.6
32.4
HomeGoods
749
809
17.5
18.8
Sierra
35
46
0.8
1.0
Homesense
16
32
0.4
0.9
In Canada:
Winners
271
279
7.5
7.6
HomeSense
125
137
2.9
3.1
Marshalls
88
97
2.4
2.6
In Europe:
T.K. Maxx
567
594
16.3
16.7
Homesense
68
78
1.3
1.5
In Australia:
T.K. Maxx
44
54
1.0
1.2
TJX
4,306
4,529
116.2
120.7
1Store counts above include both banners within a combo or a
superstore. 2Square feet figures may not foot due to rounding.
About The TJX Companies,
Inc.
The TJX Companies, Inc. is the leading off-price retailer of
apparel and home fashions in the U.S. and worldwide. As of February
1, 2020, the end of the Company’s fiscal year, the Company operated
a total of 4,529 stores in nine countries, the United States,
Canada, the United Kingdom, Ireland, Germany, Poland, Austria, the
Netherlands, and Australia, and four e-commerce sites. These
include 1,273 T.J. Maxx, 1,130 Marshalls, 809 HomeGoods, 46 Sierra,
and 32 Homesense stores, as well as tjmaxx.com, marshalls.com, and
sierra.com in the United States; 279 Winners, 137 HomeSense, and 97
Marshalls stores in Canada; 594 T.K. Maxx and 78 Homesense stores,
as well as tkmaxx.com, in Europe; and 54 T.K. Maxx stores in
Australia. TJX’s press releases and financial information are
available at TJX.com.
Fourth Quarter and Full Year Fiscal
2020 Earnings Conference Call
At 11:00 a.m. ET today, Ernie Herrman, Chief Executive Officer
and President of TJX, will hold a conference call to discuss the
Company’s fourth quarter and full year Fiscal 2020 results,
operations, business trends, and plans for Fiscal 2021. A real-time
webcast of the call will be available to the public at TJX.com. A
replay of the call will also be available by dialing (866) 367-5577
(U.S. only) or (203) 369-0233 through Wednesday, March 4, 2020, or
at TJX.com.
Non-GAAP Financial
Information
The Company has used non-GAAP financial measures in this press
release. Adjusted financial measures refer to financial information
adjusted to exclude from financial measures prepared in accordance
with accounting principles generally accepted in the United States
(GAAP) items identified in this press release. The Company believes
that the presentation of adjusted financial results provides
additional information on comparisons between periods including
underlying trends of its business by excluding certain items that
affect overall comparability. Non-GAAP financial measures should be
considered in addition to, and not as an alternative for, the
Company’s reported results prepared in accordance with GAAP.
Important Information at
Website
Archived versions of the Company’s conference calls are
available in the Investors section of TJX.com after they are no
longer available by telephone, as are reconciliations of non-GAAP
financial measures to GAAP financial measures and other financial
information. The Company routinely posts information that may be
important to investors in the Investors section at TJX.com. The
Company encourages investors to consult that section of its website
regularly.
Forward-looking
Statement
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION
REFORM ACT OF 1995: Various statements made in this release are
forward-looking and involve a number of risks and uncertainties.
All statements that address activities, events or developments that
we intend, expect or believe may occur in the future are
forward-looking statements. The following are some of the factors
that could cause actual results to differ materially from the
forward-looking statements: execution of buying strategy and
inventory management; operational and business expansion and
management of large size and scale; customer trends and
preferences; various marketing efforts; competition; personnel
recruitment, training and retention; labor costs and workforce
challenges; data security and maintenance and development of
information technology systems; economic conditions and consumer
spending; corporate and retail banner reputation; quality, safety
and other issues with our merchandise; compliance with laws,
regulations and orders and changes in laws, regulations and
applicable accounting standards; serious disruptions or
catastrophic events and adverse or unseasonable weather; expanding
international operations; merchandise sourcing and transport;
commodity availability and pricing; fluctuations in currency
exchange rates; fluctuations in quarterly operating results and
market expectations; mergers, acquisitions, or business investments
and divestitures, closings or business consolidations; outcomes of
litigation, legal proceedings and other legal or regulatory
matters; tax matters; disproportionate impact of disruptions in the
second half of the fiscal year; real estate activities; inventory
or asset loss; cash flow and other factors that may be described in
our filings with the Securities and Exchange Commission. We do not
undertake to publicly update or revise our forward-looking
statements even if experience or future changes make it clear that
any projected results expressed or implied in such statements will
not be realized.
The TJX Companies, Inc. and
Consolidated Subsidiaries
Financial Summary
(Unaudited)
(In Thousands Except Per Share
Amounts)
Thirteen Weeks Ended
Fifty-Two Weeks Ended
February 1, 2020
February 2, 2019
February 1, 2020
February 2, 2019
Net sales
$
12,206,462
$
11,127,340
$
41,716,977
$
38,972,934
Cost of sales, including buying and
occupancy costs
8,741,805
8,033,640
29,845,780
27,831,177
Selling, general and administrative
expenses
2,135,329
1,916,627
7,454,988
6,923,564
Pension settlement charge
—
—
—
36,122
Interest expense (income), net
3,053
(1,505)
10,026
8,860
Income before provision for income
taxes
1,326,275
1,178,578
4,406,183
4,173,211
Provision for income taxes
341,485
337,040
1,133,990
1,113,413
Net income
$
984,790
$
841,538
$
3,272,193
$
3,059,798
Diluted earnings per share
$
0.81
$
0.68
$
2.67
$
2.43
Cash dividends declared per share
$
0.230
$
0.195
$
0.920
$
0.780
Weighted average common shares -
diluted
1,219,365
1,244,708
1,226,519
1,259,252
The TJX Companies, Inc. and
Consolidated Subsidiaries
Condensed Balance Sheets
(Unaudited)
(In Millions)
February 1, 2020
February 2, 2019
ASSETS
Current assets:
Cash and cash equivalents
$
3,216.8
$
3,030.2
Accounts receivable and other current
assets
801.3
860.0
Merchandise inventories
4,872.6
4,579.0
Total current assets
8,890.7
8,469.2
Net property at cost
5,325.0
5,255.2
Operating lease right of use assets
9,060.3
—
Goodwill
95.5
97.6
Other assets
773.5
504.0
TOTAL ASSETS
$
24,145.0
$
14,326.0
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable
$
2,672.6
$
2,644.1
Accrued expenses and other current
liabilities
3,066.5
2,887.3
Current portion of operating lease
liabilities
1,411.2
—
Total current liabilities
7,150.3
5,531.4
Other long-term liabilities
851.1
1,354.2
Non-current deferred income taxes, net
142.2
158.2
Long-term operating lease liabilities
7,816.6
—
Long-term debt
2,236.6
2,233.6
Shareholders’ equity
5,948.2
5,048.6
TOTAL LIABILITIES AND SHAREHOLDERS’
EQUITY
$
24,145.0
$
14,326.0
The TJX Companies, Inc. and
Consolidated Subsidiaries
Condensed Statements of Cash
Flows
(Unaudited)
(In Millions)
Fifty-Two Weeks Ended
February 1, 2020
February 2, 2019
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income
$
3,272.2
$
3,059.8
Depreciation and amortization
867.3
819.7
Pension settlement charge
—
36.1
Deferred income tax (benefit)
(6.2)
(88.6)
Share-based compensation
125.0
103.6
(Increase) decrease in accounts receivable
and other assets
(94.3)
212.8
(Increase) in merchandise inventories
(296.5)
(465.4)
Increase in accounts payable
29.3
198.2
Increase in accrued expenses and other
liabilities
217.4
210.4
Other
(47.5)
1.9
Net cash provided by operating
activities
4,066.7
4,088.5
CASH FLOWS FROM INVESTING ACTIVITIES:
Property additions
(1,223.1)
(1,125.1)
Investment in Familia
(230.2)
—
Purchases of investments
(28.8)
(161.6)
Sales and maturities of investments
12.7
636.6
Other
7.4
26.5
Net cash (used in) investing
activities
(1,462.0)
(623.6)
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments for repurchase of common
stock
(1,552.0)
(2,407.0)
Proceeds from issuance of common stock
232.1
255.2
Cash dividends paid
(1,071.6)
(922.6)
Other
(23.4)
(23.1)
Net cash (used in) financing
activities
(2,414.9)
(3,097.5)
Effect of exchange rate changes on
cash
(3.2)
(95.7)
Net increase in cash and cash
equivalents
186.6
271.7
Cash and cash equivalents at beginning of
year
3,030.2
2,758.5
Cash and cash equivalents at end of
year
$
3,216.8
$
3,030.2
The TJX Companies, Inc. and
Consolidated Subsidiaries
Selected Information by Major
Business Segment
(Unaudited)
(In Thousands)
Thirteen Weeks Ended
Fifty-Two Weeks Ended
February 1, 2020
February 2, 2019
February 1, 2020
February 2, 2019
Net sales:
In the United States:
Marmaxx
$
7,402,361
$
6,855,855
$
25,664,805
$
24,057,970
HomeGoods
1,951,658
1,726,796
6,355,770
5,787,365
TJX Canada
1,134,689
1,041,323
4,031,406
3,869,779
TJX International
1,717,754
1,503,366
5,664,996
5,257,820
Total net sales
$
12,206,462
$
11,127,340
$
41,716,977
$
38,972,934
Segment profit:
In the United States:
Marmaxx
$
998,172
$
910,267
$
3,469,794
$
3,253,949
HomeGoods
241,581
216,331
680,520
671,871
TJX Canada
130,046
105,528
515,559
551,617
TJX International
128,738
93,841
307,081
285,790
Total segment profit
1,498,537
1,325,967
4,972,954
4,763,227
General corporate expense
169,209
148,894
556,745
545,034
Pension settlement charge
—
—
—
36,122
Interest expense (income), net
3,053
(1,505)
10,026
8,860
Income before provision for income
taxes
$
1,326,275
$
1,178,578
$
4,406,183
$
4,173,211
The TJX Companies, Inc. and Consolidated
Subsidiaries Notes to Consolidated Condensed Statements
- During the fourth quarter ended February 1, 2020, TJX
repurchased and retired 5.9 million shares of its common stock at a
cost of $355 million on a "trade date" basis. During the twelve
months ended February 1, 2020, TJX repurchased and retired 27.1
million shares of its common stock at a cost of $1.5 billion, on a
"trade date" basis. TJX records the repurchase of its stock on a
cash basis, and the amounts reflected in the financial statements
may vary from the above amounts due to the timing of settlement of
repurchases.
- In February 2020, the Company announced that the Board of
Directors had approved a new stock repurchase program that
authorizes the repurchase of up to $1.5 billion of TJX common stock
from time to time, with $1.7 billion still remaining on previously
authorized programs at February 1, 2020.
- TJX adopted ASU No. 2016-02, Leases (Topic 842) as of February
3, 2019 under the modified retrospective approach and, therefore,
we have not revised the consolidated balance sheets for comparative
periods.
- On November 18, 2019, the Company, through a wholly owned
subsidiary, completed an investment of $225 million, excluding
acquisition costs, for a 25% ownership stake in privately held
Familia, an established, off-price apparel and home fashions
retailer with more than 275 stores throughout Russia. The Company's
investment represents a non-controlling, minority position.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20200226005479/en/
The TJX Companies, Inc. Debra McConnell Global Communications
(508) 390-2323
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