- Reported Q4 FY21 net sales of $10.9 billion, which reflects
the negative impact of temporary store closures for approximately
13% of the quarter
- Q4 FY21 overall open-only comp store sales decreased 3%,
which was well above the Company’s plans
- Q4 FY21 diluted earnings per share were $.27, which includes
a debt extinguishment charge of $.18 per share and a higher tax
rate in the fourth quarter that negatively impacted EPS by an
additional $.05
- The Company estimates that its temporary store closures in
Europe and Canada negatively impacted fourth quarter sales by
approximately $950 million to $1.05 billion and EPS by
approximately $.18 to $.21 (see below)
- Reported FY21 net sales of $32.1 billion, which reflects the
negative impact of temporary store closures for approximately 24%
of the year
- FY21 overall open-only comp store sales decreased 4%, which
was above the Company’s plans
- FY21 diluted earnings per share were $.07, which includes a
debt extinguishment charge of $.19 per share
- Generated FY21 operating cash flow of $4.6 billion
- Declared the previously announced Q4 FY21 dividend at an
increased rate of $.26 per share; Announces plans to declare a
quarterly dividend at the current rate in the first quarter of
Fiscal 2022, subject to Board approval
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 operating results for the fourth quarter ended
January 30, 2021. Net sales for the fourth quarter of Fiscal 2021
were $10.9 billion. Overall open-only comp store sales (defined
below) were down 3% versus last year. Net income for the fourth
quarter was $326 million. Diluted earnings per share were $.27,
which includes a debt extinguishment charge (described below) of
$.18 per share. The Company’s higher tax rate in the fourth quarter
of Fiscal 2021 resulted in a decrease in earnings per share of $.05
compared to the prior year. The higher tax rate was primarily due
to the Company shifting to a year-to-date net income position in
the fourth quarter and the related impact of the jurisdictional mix
of profits and losses.
The Company’s results for the fourth quarter of Fiscal 2021 were
negatively impacted by the temporary closure of some of its stores
due to the COVID-19 global pandemic. Although the Company’s stores
in the U.S. were generally open the entire fourth quarter, stores
in Europe were closed for approximately 63% of the fourth quarter
and stores in Canada were closed for about 32% of the quarter. In
total, the Company had stores closed for approximately 13% of the
fourth quarter due to the COVID-19 global pandemic (see table
below). The Company estimates that these European and Canadian
closures may have resulted in approximately $950 million to $1.05
billion in lost sales during the fourth quarter of Fiscal 2021.
This range of estimated lost sales assumes all European and
Canadian stores operated at similar open-only comp store sales
trends as the third and fourth quarters of Fiscal 2021,
respectively. Based on management’s estimate of profit dollars on
this range of lost sales, the Company estimates that fourth quarter
Fiscal 2021 earnings per share were negatively impacted by
approximately $.18 to $.21.
For the full year Fiscal 2021, net sales were $32.1 billion.
Fiscal 2021 overall open-only comp store sales were down 4% versus
last year. Net income was $90 million. Diluted earnings per share
were $.07, which includes a debt extinguishment charge (described
below) of $.19 per share. The Company’s results for Fiscal 2021
were negatively impacted by the temporary closure of its stores for
approximately 24% of the year due to the COVID-19 global pandemic
(see table below).
Q4 FY21 and Full Year Fiscal 2021 Store
Closures by Region (in percent of store days closed)
Region
Q4 FY21
Fiscal 2021
U.S.
0%
20%
Canada
32%
29%
Europe
63%
38%
Australia
1%
23%
Total TJX
13%
24%
CEO and President
Comments
Ernie Herrman, Chief Executive Officer and President of The TJX
Companies, Inc., stated, “As we report our 2020 results, I want to
thank our global Associates for their extraordinary efforts during
an unprecedented year. They pulled together and worked as ‘One
TJX,’ and I am especially proud of their commitment to the health
and safety protocols for our Associates and customers. I want to
give special recognition to our store, distribution, and
fulfillment center Associates who have been physically coming in to
work to keep our business open. I could not be prouder of our teams
around the world who achieved monumental tasks in the face of a
global pandemic in 2020.”
Herrman continued, “In terms of the business results, I am very
pleased that our fourth quarter open-only comp store sales were
down only 3%, exceeding our plans. Our brands, values, and exciting
gift assortments resonated with customers, and we achieved these
results despite numerous COVID-related headwinds. Overall open-only
comp store sales improved each month of the quarter and were
positive in January. Further, open-only comp store sales exceeded
our plans across each of our divisions, including at HomeGoods
which once again delivered a double-digit increase. We also saw
continued strength in our home and beauty departments. As we start
the new fiscal year, while uncertainty around COVID-19 remains, we
feel very good about the strength of the business and our market
share opportunities beyond the health crisis. We are convinced that
our entertaining, treasure hunt shopping experience, our
differentiated, branded merchandise selections, and value
proposition will continue to resonate with consumers. We see many
opportunities to leverage our flexible business model, gain more
customers, and continue driving the successful growth of TJX for
many years ahead.”
Margins
For the fourth quarter of Fiscal 2021, the Company’s
consolidated pretax profit margin was 4.6%, which includes a 2.9
percentage point negative impact due to a debt extinguishment
charge (described below) of $312 million. The Company’s merchandise
margin was up versus the prior year.
For the full year Fiscal 2021, the Company’s consolidated pretax
profit margin was 0.3%, which includes a 1.0 percentage point
negative impact due to a debt extinguishment charge (described
below) of $312 million in the fourth quarter.
Debt Extinguishment
Charge
On November 30, 2020, the Company completed the issuance and
sale of $500 million aggregate principal amount of 1.15%, 7.5-year
notes and $500 million aggregate principal amount of 1.60%,
10.5-year notes. The Company used the proceeds to fund its cash
tender for $364.50 million of its 4.50% notes and $754.15 million
of its 3.875% notes on December 4, 2020, prior to their scheduled
maturities of April 15, 2050 and April 15, 2030 respectively. The
total charge for the early extinguishment of this debt reduced
fourth quarter and full year Fiscal 2021 pretax income by $312
million.
Cash and Dividend Update
The Company generated $4.6 billion of operating cash flow for
the full year Fiscal 2021 and ended the year with $10.5 billion of
cash. The Company declared a quarterly dividend in the fourth
quarter of Fiscal 2021 at an increased rate of $.26 per share. This
represented a 13% increase in the per share dividend compared to
the Company’s previous dividend paid in March 2020. The Company
expects to declare a dividend of $.26 per share in the first
quarter quarter of Fiscal 2022, subject to Board approval.
Temporary Store Closings
The Company currently has approximately 690 stores that are
temporarily closed due to government mandates in response to the
COVID-19 global pandemic. The vast majority of these stores are
located in Europe, where the Company expects stores will be
temporarily closed for an estimated 67% of the first quarter of
Fiscal 2022. In total, based on restrictions currently in place,
the Company expects its stores to be closed for approximately 11%
of the first quarter of Fiscal 2022. All of the Company’s
e-commerce businesses remain open, including tkmaxx.com in the
U.K.
Open-Only Comp Store
Sales
Due to the temporary closing of stores as a result of the
COVID-19 global pandemic, the Company’s historical definition of
comp store sales is not applicable this quarter and for Fiscal
2021. In order to provide a performance indicator for its stores as
they reopen, the Company has been temporarily reporting a new sales
measure: open-only comp store sales. Open-only comp store sales
includes stores initially classified as comp stores at the
beginning of Fiscal 2021 that have had to temporarily close due to
the COVID-19 pandemic. This measure reports the sales increase or
decrease of these stores for the days the stores were open in the
current period against sales for the same days in the prior
year.
Sales by Business
Segment
The Company’s open-only comp store sales and net sales by
division, in the fourth quarter and full year, were as follows:
Fourth Quarter Open-Only Comp
Store Sales1,2
Fourth Quarter Net Sales
($ in millions)3,4
FY2021
FY2020
Marmaxx (U.S.)5,6
-7%
$6,921
$7,402
HomeGoods (U.S.)7
+12%
$2,225
$1,952
TJX Canada
-4%
$837
$1,135
TJX International (Europe &
Australia)
+2%
$961
$1,718
TJX
-3%
$10,943
$12,206
Full Year Open-Only Comp Store
Sales1,2
Full Year Net Sales ($ in
millions)3,4
FY2021
FY2020
Marmaxx (U.S.)5,6
-7%
$19,363
$25,665
HomeGoods (U.S.)7
+13%
$6,096
$6,356
TJX Canada
-8%
$2,836
$4,031
TJX International (Europe &
Australia)
-2%
$3,842
$5,665
TJX
-4%
$32,137
$41,717
1Open-only comparable store sales outside
the U.S. calculated on a constant currency basis, which removes the
effect of changes in currency exchange rates. 2Open-only comparable
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. 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.
Inventory
Total inventories as of January 30, 2021, were $4.3 billion,
compared with $4.9 billion at the end of the prior fiscal year.
Overall product availability in the marketplace remains excellent
and the Company continues to focus its buying towards the
categories that have had the strongest demand. The Company is well
positioned to deliver a fresh assortment of merchandise to its
stores and e-commerce sites throughout the spring season.
Outlook
For the first three weeks of the first quarter of Fiscal 2022,
overall open-only comp store sales trends were better than the
fourth quarter of Fiscal 2021, despite unfavorable weather in the
U.S. In the periods before and after the unfavorable weather,
overall open-only comp store sales were positive. In the first
quarter of Fiscal 2022, the Company expects total sales, pretax
margin, and earnings per share to be negatively impacted from the
temporary store closings described above. Due to the continued
uncertainty of the current environment and the difficulty in
forecasting the impact of the global pandemic on temporary store
closures and consumer behavior, demand, and traffic, the Company is
not providing financial guidance at this time.
Stores by Concept
During the fiscal year ended January 30, 2021, the Company
increased its store count by 43 stores to a total of 4,572 stores
and increased square footage by 1% over the same period last year.
The Company’s slower pace of store growth in Fiscal 2021 was due to
a reduction of capital spending in response to the global pandemic.
The majority of new store openings planned for Fiscal 2021 were
delayed until Fiscal 2022.
Store Locations1
Gross Square Feet2
FY21
FY21
(in millions)
Beginning
End
Beginning
End
In the U.S.:
T.J. Maxx
1,273
1,271
34.9
34.8
Marshalls
1,130
1,131
32.4
32.4
HomeGoods
809
821
18.8
19.1
Sierra
46
48
1.0
1.0
Homesense
32
34
0.9
0.9
In Canada:
Winners
279
280
7.6
7.7
HomeSense
137
143
3.1
3.3
Marshalls
97
102
2.6
2.7
In Europe:
T.K. Maxx
594
602
16.7
16.9
Homesense
78
78
1.5
1.5
In Australia:
T.K. Maxx
54
62
1.2
1.3
TJX
4,529
4,572
120.7
121.6
1Store counts above include both banners
within a combo or a superstore. Includes stores that were or are
temporarily closed due to COVID-19.
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 January
30, 2021, the end of the Company’s fiscal year, the Company
operated a total of 4,572 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 1,271 T.J. Maxx, 1,131 Marshalls, 821 HomeGoods, 48
Sierra, and 34 Homesense stores, as well as tjmaxx.com,
marshalls.com, and sierra.com in the United States; 280 Winners,
143 HomeSense, and 102 Marshalls stores in Canada; 602 T.K. Maxx
and 78 Homesense stores, as well as tkmaxx.com, in Europe; and 62
T.K. Maxx stores in Australia. TJX’s press releases and financial
information are available at TJX.com.
Fourth Quarter and Full Year Fiscal
2021 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 2021 results,
operations, and business trends. 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 3, 2021, or at TJX.com.
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; economic
conditions and consumer spending; the ongoing COVID-19 global
pandemic and associated containment and remediation efforts; labor
costs and workforce challenges; personnel recruitment, training and
retention; data security and maintenance and development of
information technology systems; 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; disproportionate impact of disruptions in the
second half of the fiscal year; cash flow; inventory or asset loss;
tax matters; real estate activities; 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
January 30, 2021
February 1, 2020
January 30, 2021
February 1, 2020
Net sales
$
10,943,210
$
12,206,462
$
32,136,962
$
41,716,977
Cost of sales, including buying and
occupancy costs
7,882,575
8,741,805
24,533,815
29,845,780
Selling, general and administrative
expenses
2,193,101
2,135,329
7,020,917
7,454,988
Loss on early extinguishment of debt
312,233
—
312,233
—
Interest expense, net
47,163
3,053
180,734
10,026
Income before income taxes
508,138
1,326,275
89,263
4,406,183
(Provision) benefit for income taxes
(182,615)
(341,485)
1,207
(1,133,990)
Net income
$
325,523
$
984,790
$
90,470
$
3,272,193
Diluted earnings per share
$
0.27
$
0.81
$
0.07
$
2.67
Cash dividends declared per share
$
0.26
$
0.23
$
0.26
$
0.92
Weighted average common shares –
diluted
1,219,479
1,219,365
1,214,703
1,226,519
The TJX Companies, Inc. and
Consolidated Subsidiaries
Condensed Balance Sheets
(Unaudited)
(In Millions)
January 30, 2021
February 1, 2020
ASSETS
Current assets:
Cash and cash equivalents
$
10,469.6
$
3,216.8
Accounts receivable and other current
assets
896.1
754.3
Merchandise inventories
4,337.4
4,872.6
Federal, state and foreign income taxes
recoverable
36.2
47.0
Total current assets
15,739.3
8,890.7
Net property at cost
5,036.1
5,325.0
Operating lease right of use assets
8,990.0
9,060.3
Goodwill
99.0
95.5
Other assets
949.2
773.5
TOTAL ASSETS
$
30,813.6
$
24,145.0
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable
$
4,823.4
$
2,672.6
Accrued expenses and other current
liabilities
3,553.0
3,066.5
Current portion of operating lease
liabilities
1,677.6
1,411.2
Current portion of long-term debt
749.7
—
Total current liabilities
10,803.7
7,150.3
Other long-term liabilities
1,063.9
851.1
Non-current deferred income taxes, net
37.2
142.2
Long-term operating lease liabilities
7,743.2
7,816.6
Long-term debt
5,332.9
2,236.6
Shareholders’ equity
5,832.7
5,948.2
TOTAL LIABILITIES AND SHAREHOLDERS’
EQUITY
$
30,813.6
$
24,145.0
The TJX Companies, Inc. and
Consolidated Subsidiaries
Condensed Statements of Cash
Flows
(Unaudited)
(In Millions)
Fifty-Two Weeks Ended
January 30, 2021
February 1, 2020
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income
$
90.5
$
3,272.2
Depreciation and amortization
870.8
867.3
Loss on early extinguishment of debt
312.2
—
Loss on property disposals and impairment
charges
83.8
16.1
Deferred income tax (benefit)
(230.7)
(6.2)
Share-based compensation
58.5
125.0
(Increase) in accounts receivable and
other assets
(128.5)
(60.1)
Decrease (increase) in merchandise
inventories
588.8
(296.5)
Decrease (increase) in income taxes
recoverable
10.7
(34.2)
Increase in accounts payable
2,111.2
29.3
Increase in accrued expenses and other
liabilities
637.3
217.4
Increase in net operating lease
liabilities
200.2
29.6
Other
(42.9)
(93.2)
Net cash provided by operating
activities
4,561.9
4,066.7
CASH FLOWS FROM INVESTING ACTIVITIES:
Property additions
(568.0)
(1,223.1)
Investment in Familia
—
(230.2)
Purchase of investments
(29.1)
(28.8)
Sales and maturities of investments
18.5
12.7
Other
—
7.4
Net cash (used in) investing
activities
(578.6)
(1,462.0)
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments on revolving credit
facilities
(1,000.0)
—
Proceeds from long-term debt including
revolving credit facilities
5,986.9
—
Payments of long-term debt and
extinguishment expenses
(1,418.3)
—
Payments for debt issuance expenses
(42.4)
—
Payments for repurchase of common
stock
(201.5)
(1,552.0)
Proceeds from issuance of common stock
211.2
232.1
Cash dividends paid
(278.3)
(1,071.6)
Other
(29.3)
(23.4)
Net cash provided by (used in) financing
activities
3,228.3
(2,414.9)
Effect of exchange rate changes on
cash
41.2
(3.2)
Net increase in cash and cash
equivalents
7,252.8
186.6
Cash and cash equivalents at beginning of
year
3,216.8
3,030.2
Cash and cash equivalents at end of
year
$
10,469.6
$
3,216.8
The TJX Companies, Inc. and
Consolidated Subsidiaries
Selected Information by Major
Business Segment
(Unaudited)
(In Thousands)
Thirteen Weeks Ended
Fifty-Two Weeks Ended
January 30, 2021
February 1, 2020
January 30, 2021
February 1, 2020
Net sales:
In the United States:
Marmaxx
$
6,920,701
$
7,402,361
$
19,362,573
$
25,664,805
HomeGoods
2,224,758
1,951,658
6,096,237
6,355,770
TJX Canada
836,706
1,134,689
2,836,088
4,031,406
TJX International
961,045
1,717,754
3,842,064
5,664,996
Total net sales
$
10,943,210
$
12,206,462
$
32,136,962
$
41,716,977
Segment profit (loss):
In the United States:
Marmaxx
$
835,308
$
998,172
$
891,180
$
3,469,794
HomeGoods
274,480
241,581
509,562
680,520
TJX Canada
22,839
130,046
124,143
515,559
TJX International
(200,315)
128,738
(503,618)
307,081
Total segment profit
932,312
1,498,537
1,021,267
4,972,954
General corporate expense
64,778
169,209
439,037
556,745
Loss on early extinguishment of debt
312,233
—
312,233
—
Interest expense, net
47,163
3,053
180,734
10,026
Income before income taxes
$
508,138
$
1,326,275
$
89,263
$
4,406,183
The TJX Companies, Inc. and Consolidated
Subsidiaries Notes to Consolidated Condensed Statements
- In December 2019, a novel coronavirus ("COVID-19") emerged and
spread worldwide. The World Health Organization declared COVID-19 a
pandemic in March 2020, resulting in federal, state and local
governments and private entities mandating various restrictions,
including travel restrictions, restrictions on public gatherings,
stay at home orders and advisories and quarantine or isolation
protocols for those who may have been exposed to the virus. In
March 2020, the Company temporarily closed all of its stores, its
online businesses, its distribution centers and its offices, with
Associates working remotely where possible. In May 2020, the
Company began reopening stores and by the end of the second
quarter, more than 4,500 of the Company’s worldwide stores, and
each of its online businesses had reopened. In response to
increasing cases of COVID-19 a number of our stores have
temporarily closed again. As of February 23, 2021, the Company had
approximately 690 stores temporarily closed in Europe and Canada
due to local government mandates in response to the ongoing global
pandemic. The vast majority of these stores are located in Europe,
and the Company expects these stores will temporarily be closed for
a significant portion of the first quarter of Fiscal 2022. The
Company’s tkmaxx.com e-commerce business in the U.K. remains open.
These and other factors have had and may continue to have a
material impact on our business, results of operations, financial
position and cash flows.
- The Company has taken several steps to further strengthen our
financial position and balance sheet, and maintain financial
liquidity and flexibility, including suspending our share
repurchase program, reviewing operating expenses, evaluating, and
in some cases, extending merchandise payment terms, reducing
capital expenditures, negotiating rent deferrals for a significant
number of stores and not declaring a dividend in the first nine
months of fiscal 2021. In April 2020 the Company issued $4.0
billion in aggregate principal long-term debt. In August 2020, the
Company increased its borrowing capacity under revolving credit
facilities with a new $500 million facility, making a total of $1.5
billion available to the Company. Additionally, during the fourth
quarter, the Company issued $1.0 billion in aggregate long-term
debt and accepted for purchase $1.1 billion in combined aggregate
principal amount of certain of its notes issued on April 1, 2020
pursuant to cash tender offers. The Company paid $1.4 billion
aggregate consideration (including transaction costs) and recorded
a $312 million pre-tax loss on the early extinguishment for the
accepted notes.
- While the Company's Board of Directors did not declare a
dividend in the first nine months of fiscal 2021, the Board of
Directors declared a dividend of $0.26 per share in the fourth
quarter of fiscal 2021, payable in March 2021.
- Prior to the suspension of the share buyback program during the
first quarter of fiscal 2021, TJX repurchased and retired 3.2
million shares of its common stock at a cost of $190 million 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. As of January 30, 2021, the Company had approximately
$3.0 billion available under previously announced stock repurchase
programs.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210224005570/en/
The TJX Companies, Inc. Debra McConnell Global Communications
(508) 390-2323
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