- Q1 FY22 overall open-only comp store sales increased 16%
compared to Q1 FY20
- Q1 FY22 diluted earnings per share were $.44
- Q1 FY22 net sales were $10.1 billion, an increase of 129%
compared to Q1 FY21 and an increase of 9% compared to Q1
FY20
- The Company estimates that temporary store closures for
approximately 14% of the first quarter, primarily stores in Europe
and Canada, negatively impacted Q1 FY22 sales by approximately $1.1
billion to $1.2 billion and EPS by approximately $.21 to $.24 (see
below)
- In April, redeemed $750 million of debt at par that was due
to mature in June 2021
- Announcing make-whole calls that will reduce outstanding
debt by an additional $2.0 billion (see below)
- For the start of Q2 FY22, overall open-only comp store sales
trends remain similar to Q1 FY22
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 first quarter ended
May 1, 2021. Net sales for the first quarter of Fiscal 2022 were
$10.1 billion, an increase of 129% versus the first quarter of
Fiscal 2021 in which stores were closed for approximately 50% of
the quarter due to the COVID-19 global pandemic (see table below).
Net sales for the first quarter of Fiscal 2022 increased 9% versus
the first quarter of Fiscal 2020. Overall open-only comp store
sales (defined below) increased 16% compared to the first quarter
of Fiscal 2020. Net income for the first quarter was $534 million
and diluted earnings per share were $.44.
The Company’s results for the first quarter of Fiscal 2022 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 open for the first quarter, stores in Europe were
closed for approximately 76% of the first quarter and stores in
Canada were closed for about 25% of the quarter. In total, the
Company had stores closed for approximately 14% of the first
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 $1.1 billion to $1.2 billion in lost
sales during the first quarter of Fiscal 2022. This range of
estimated lost sales assumes all European and Canadian stores
operated at similar open-only comp store sales trends as the fourth
quarter of Fiscal 2021 and first quarter of Fiscal 2022. Based on
management’s estimate of profit dollars on this range of lost
sales, the Company estimates that first quarter Fiscal 2022
earnings per share were negatively impacted by approximately $.21
to $.24.
CEO and President
Comments
Ernie Herrman, Chief Executive Officer and President of The TJX
Companies, Inc., stated, “I am extremely pleased with our first
quarter results, with overall open-only comp store sales up 16% and
earnings per share of $.44, both well above our plan. I want to
recognize the excellent work of our global Associates across the
organization, especially our store and distribution center
Associates who are physically coming into work to bring great
values to our customers. Once again, we saw phenomenal performance
in our home businesses across all of our divisions. We also saw
strong open-only comp store sales increases in many other
categories and positive open-only comp store sales in overall
apparel, which we believe benefitted from consumers beginning to
resume more normal activities. Our U.S. divisions delivered
outstanding double-digit open-only comp store sales increases, and
sales at our international divisions were very strong when their
stores were permitted to be open. Clearly, our treasure-hunt
shopping experience, eclectic mix of merchandise, and great brands
and values continue to resonate with shoppers across our
geographies. As we start the second quarter, overall open-only comp
store sales trends remain similar to the first quarter. While the
environment remains uncertain, particularly internationally, we are
convinced we are strongly positioned as we emerge from this health
crisis. Looking ahead, we see numerous opportunities to capture
additional market share around the world and are excited about the
runway for growth we see for TJX.”
Sales by Business
Segment
The Company’s open-only comp store sales and net sales by
division in the first quarter were as follows:
First Quarter FY2022 Open-Only
Comp Store Sales Versus FY20201,2,3
First Quarter Net Sales ($
in millions)4,5
FY2022
FY2021
FY2020
Marmaxx (U.S.)6,7
+12%
$6,640
$2,698
$5,802
HomeGoods (U.S.)8
+40%
$2,142
$760
$1,397
TJX Canada
+9%
$766
$380
$848
TJX International (Europe &
Australia)
+11%
$539
$572
$1,231
TJX
+16%
$10,087
$4,409
$9,278
1This measure reports the sales increase or decrease of these
stores for the days the stores were open in the first quarter of
Fiscal 2022 against sales for the same days in Fiscal 2020, prior
to the emergence of the pandemic, which the Company believes is a
more useful comparison than against the first quarter of Fiscal
2021. 2Open-only comparable store sales outside the U.S. calculated
on a constant currency basis, which removes the effect of changes
in currency exchange rates. 3Open-only comparable store sales
exclude e-commerce sites (tjmaxx.com, marshalls.com, sierra.com,
and tkmaxx.com) and include Sierra stores. 4Net sales in TJX Canada
and TJX International include the impact of foreign currency
exchange rates. 5Figures may not foot due to rounding. 6Combination
of T.J. Maxx and Marshalls. 7Net sales include Sierra’s e-commerce
and store sales. 8Includes Homesense stores in the U.S.
Margins
For the first quarter of Fiscal 2022, the Company’s consolidated
pretax profit margin was 7.2%. The Company’s merchandise margin was
up slightly compared to the first quarter of Fiscal 2020.
Merchandise margin improvement versus Fiscal 2020 was due to strong
markon and lower markdowns, mostly offset by higher freight
costs.
Cash and Dividend Update
The Company ended the first quarter of Fiscal 2022 with $8.8
billion of cash. The Company declared a quarterly dividend of $.26
in the first quarter of Fiscal 2022 and expects to declare a
similar dividend in the second quarter of Fiscal 2022, subject to
Board approval.
Redemption of Senior
Notes
In April 2021, the Company redeemed its $750 million principal
outstanding, 2.75% Notes due June 15, 2021 at par. Today, the
Company is also announcing make-whole calls for its $1.25 billion
principal outstanding, 3.50% Notes due April 15, 2025, and its $750
million principal outstanding, 3.75% Notes due April 15, 2027.
These make-whole calls are expected to settle on June 4, 2021, and
once completed are expected to result in a pre-tax debt
extinguishment charge of approximately $250 million in the second
quarter of Fiscal 2022. The result of these three debt redemptions
once completed are expected to be a $2.75 billion reduction of
outstanding debt since the beginning of Fiscal 2022 and more than
$90 million of annualized interest expense savings.
Inventory
Total inventories as of May 1, 2021, were $5.1 billion, compared
with $4.9 billion at the end of the first quarter last year.
Overall product availability in the marketplace remains excellent
and the Company has continued to flex its buying to the categories
with the strongest demand. The Company is well positioned to
deliver a fresh assortment of merchandise to its stores and
e-commerce sites throughout the summer season.
Q1 Fiscal 2022 and Q1 Fiscal 2021 Store
Closures by Region (in percent of store days closed)
Region
Q1 FY22
Q1 FY21
U.S.
0%
50%
Canada
25%
53%
Europe
76%
49%
Australia
2%
49%
Total TJX
14%
50%
Temporary Store Closings
The Company currently has approximately 300 stores that are
temporarily closed due to government mandates in response to the
COVID-19 global pandemic. All of these stores are located in Canada
and Europe. At this time, the Company expects its stores in Canada
and Europe will be temporarily closed for an estimated 17% and 7%
of the second quarter of Fiscal 2022, respectively. In total, based
on the restrictions currently in place, the Company expects its
stores to be closed for approximately 3% of the second quarter of
Fiscal 2022. All of the Company’s e-commerce businesses remain
open.
Fiscal 2022 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 for the first quarter of Fiscal
2022. 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. The Company’s open-only comp
store sales calculation includes stores initially classified as
comp stores at the beginning of Fiscal 2021. This measure reports
the sales increase or decrease of these stores for the days the
stores were open in the first quarter of Fiscal 2022 against sales
for the same days in Fiscal 2020, prior to the emergence of the
global pandemic.
Outlook
For the start of the second quarter of Fiscal 2022, overall
open-only comp store sales trends remain similar to the first
quarter. In the second 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, the Company
is not providing financial guidance at this time.
Stores by Concept
During the first quarter ended May 1, 2021, the Company
increased its store count by 67 stores to a total of 4,639 stores
and increased square footage by 1% versus the previous quarter.
Store Locations1
Gross Square Feet2
First Quarter
First Quarter
(in millions)
Beginning
End
Beginning
End
In the U.S.:
T.J. Maxx
1,271
1,282
34.8
35.0
Marshalls
1,131
1,147
32.4
32.7
HomeGoods
821
843
19.1
19.6
Sierra
48
52
1.0
1.1
Homesense
34
39
0.9
1.0
In Canada:
Winners
280
284
7.7
7.8
HomeSense
143
143
3.3
3.3
Marshalls
102
103
2.7
2.7
In Europe:
T.K. Maxx
602
604
16.9
17.0
Homesense
78
78
1.5
1.5
In Australia:
T.K. Maxx
62
64
1.3
1.4
TJX
4,572
4,639
121.6
123.1
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 May 1,
2021, the end of the Company’s first quarter, the Company operated
a total of 4,639 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 1,282 T.J. Maxx, 1,147 Marshalls, 843 HomeGoods, 52 Sierra,
and 39 Homesense stores, as well as tjmaxx.com, marshalls.com, and
sierra.com, in the United States; 284 Winners, 143 HomeSense, and
103 Marshalls stores in Canada; 604 T.K. Maxx and 78 Homesense
stores, as well as tkmaxx.com, in Europe; and 64 T.K. Maxx stores
in Australia. TJX’s press releases and financial information are
available at TJX.com.
First Quarter Fiscal 2022 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 first quarter Fiscal 2022 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, May 26, 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: the ongoing COVID-19 pandemic and
associated containment and remediation efforts; execution of buying
strategy and inventory management; various marketing efforts;
customer trends and preferences; competition; operational and
business expansion; management of large size and scale; merchandise
sourcing and transport; 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; cash flow; expanding
international operations; fluctuations in quarterly operating
results and market expectations; mergers, acquisitions, or business
investments and divestitures, closings or business consolidations;
real estate activities; inventory or asset loss; economic
conditions and consumer spending; market instability; serious
disruptions or catastrophic events; disproportionate impact of
disruptions in the second half of the fiscal year; commodity
availability and pricing; adverse or unseasonable weather;
fluctuations in currency exchange rates; compliance with laws,
regulations and orders and changes in laws, regulations and
applicable accounting standards; outcomes of litigation, legal
proceedings and other legal or regulatory matters; quality, safety
and other issues with our merchandise; tax matters; 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
May 1, 2021
May 2, 2020
Net sales
$
10,086,661
$
4,408,888
Cost of sales, including buying and
occupancy costs
7,255,635
4,414,465
Selling, general and administrative
expenses
2,064,992
1,313,920
Interest expense, net
44,688
23,351
Income (loss) before income taxes
721,346
(1,342,848
)
(Provision) benefit for income taxes
(187,416
)
455,359
Net income (loss)
$
533,930
$
(887,489
)
Diluted earnings (loss) per share
$
0.44
$
(0.74
)
Cash dividends declared per share
$
0.26
$
—
Weighted average common shares –
diluted
1,221,517
1,197,809
The TJX Companies, Inc. and Consolidated Subsidiaries
Condensed Balance Sheets
(Unaudited)
(In Millions)
May 1, 2021
May 2, 2020
ASSETS
Current assets:
Cash and cash equivalents
$
8,775.5
$
4,287.8
Accounts receivable and other current
assets
1,061.7
581.2
Merchandise inventories
5,114.6
4,945.7
Federal, state and foreign income taxes
recoverable
64.2
481.6
Total current assets
15,016.0
10,296.3
Net property at cost
5,067.8
5,201.7
Operating lease right of use assets
9,121.6
9,073.9
Goodwill
99.3
94.5
Other assets
996.7
748.8
TOTAL ASSETS
$
30,301.4
$
25,415.2
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable
$
4,433.3
$
1,071.2
Accrued expenses and other current
liabilities
3,823.1
2,199.1
Current portion of operating lease
liabilities
1,650.6
1,399.3
Total current liabilities
9,907.0
4,669.6
Other long-term liabilities
1,033.2
786.0
Non-current deferred income taxes, net
33.9
113.2
Long-term operating lease liabilities
7,853.2
7,914.8
Long-term debt
5,334.9
7,192.4
Shareholders’ equity
6,139.2
4,739.2
TOTAL LIABILITIES AND SHAREHOLDERS’
EQUITY
$
30,301.4
$
25,415.2
The TJX Companies, Inc. and Consolidated Subsidiaries
Condensed Statements of Cash
Flows
(Unaudited)
(In Millions)
Thirteen Weeks Ended
May 1, 2021
May 2, 2020
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)
$
533.9
$
(887.5
)
Depreciation and amortization
215.4
219.5
Deferred income tax (benefit)
(16.2
)
(48.5
)
Share-based compensation
50.5
(11.5
)
(Increase) decrease in accounts receivable
and other assets
(144.7
)
170.8
(Increase) in merchandise inventories
(750.6
)
(136.0
)
(Increase) in income taxes recoverable
(27.9
)
(434.7
)
(Decrease) in accounts payable
(410.2
)
(1,567.6
)
Increase (decrease) in accrued expenses
and other liabilities
216.0
(591.5
)
(Decrease) increase in net operating lease
liabilities
(50.3
)
65.6
Other
(48.6
)
60.9
Net cash (used in) operating
activities
(432.7
)
(3,160.5
)
CASH FLOWS FROM INVESTING ACTIVITIES:
Property additions
(225.3
)
(210.5
)
Purchase of investments
(7.3
)
(14.8
)
Sales and maturities of investments
7.7
4.2
Net cash (used in) investing
activities
(224.9
)
(221.1
)
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments on debt
(750.0
)
—
Proceeds from long-term debt
—
4,988.5
Payments for debt issuance expenses
—
(33.9
)
Payments for repurchase of common
stock
—
(201.5
)
Cash dividends paid
(315.2
)
(278.3
)
Proceeds from issuance of common stock
36.5
37.4
Other
(24.4
)
(21.8
)
Net cash (used in) provided by financing
activities
(1,053.1
)
4,490.4
Effect of exchange rate changes on
cash
16.6
(37.8
)
Net (decrease) increase in cash and cash
equivalents
(1,694.1
)
1,071.0
Cash and cash equivalents at beginning of
year
10,469.6
3,216.8
Cash and cash equivalents at end of
period
$
8,775.5
$
4,287.8
The TJX Companies, Inc. and Consolidated Subsidiaries
Selected Information by Major
Business Segment
(Unaudited)
(In Thousands)
Thirteen Weeks Ended
May 1, 2021
May 2, 2020
Net sales:
In the United States:
Marmaxx
$
6,640,486
$
2,697,779
HomeGoods
2,141,756
759,865
TJX Canada
765,536
379,636
TJX International
538,883
571,608
Total net sales
$
10,086,661
$
4,408,888
Segment profit (loss):
In the United States:
Marmaxx
$
824,855
$
(709,669
)
HomeGoods
251,602
(153,703
)
TJX Canada
71,577
(97,181
)
TJX International
(221,558
)
(258,617
)
Total segment profit (loss)
926,476
(1,219,170
)
General corporate expense
160,442
100,327
Interest expense, net
44,688
23,351
Income (loss) before income taxes
$
721,346
$
(1,342,848
)
The TJX Companies, Inc. and Consolidated
Subsidiaries Notes to Consolidated Condensed Statements
- The novel coronavirus ("COVID-19") was first identified in
December 2019 before spreading worldwide. In response to the
COVID-19 pandemic, the Company temporarily closed all of its
stores, online businesses, distribution centers and offices in
March 2020. As of May 18, 2021, the Company had approximately 300
stores, primarily in Europe and Canada, that were temporarily
closed due to government mandates in response to the COVID-19
pandemic. All of the Company’s e-commerce business throughout the
first quarter of fiscal 2022 remained open, including tkmaxx.com in
the U.K. Our results for the first quarter of fiscal 2022 and
fiscal 2021 were negatively impacted by the temporary closures of
our stores. These and other factors have had and may continue to
have a material impact on our business, results of operations,
financial position and liquidity.
- In April 2021, the Company redeemed $750 million of its 2.75%
Notes due June 15, 2021 at par. The Company is also announcing
today make-whole calls for its $1.25 billion principal outstanding
3.50% Notes due April 15, 2025, and its $750 million principal
outstanding 3.75% Notes due April 15, 2027, both of which were
issued in the first quarter of fiscal 2021. These make-whole calls
are expected to settle on June 4, 2021 and once completed are
expected to result in a pre-tax debt extinguishment charge of
approximately $250 million in the second quarter of fiscal
2022.
- The Company declared a quarterly dividend on our common stock
of $0.26 per share in the first quarter of fiscal 2022. No
dividends were declared in the first quarter of fiscal 2021.
- The Company suspended its share buyback program in the first
quarter of fiscal 2021 in light of the COVID-19 pandemic.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210519005499/en/
Debra McConnell Global Communications (508) 390-2323
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