The TJX Companies, Inc. Reports Q2 FY25 Results; Comp Store Sales Growth of 4%, Pretax Profit Margin of 10.9%, and Diluted EPS of $.96 All Above Plan; Raises FY25 Pretax Profit Margin and EPS Guidance
-
Q2 consolidated comparable store sales increased
4% , above the Company’s plan, and were entirely driven by an increase in customer transactions -
Q2 pretax profit margin of
10.9% , up 0.5 percentage points versus last year and well above the Company’s plan -
Q2 diluted earnings per share of
$.96 , up13% versus last year and well above the Company’s plan -
Returned
to shareholders in Q2 through share repurchases and dividends$982 million - Opened 5,000th store worldwide
-
Signed definitive agreement to invest approximately
for a$360 million 35% ownership stake in privately held Brands For Less (see below) - Increases outlook for FY25 pretax profit margin and earnings per share
For the first half of Fiscal 2025, net sales were
CEO and President Comments
Ernie Herrman, Chief Executive Officer and President of The TJX Companies, Inc., stated, “I am extremely pleased with our second quarter performance. Our comparable store sales increase of
Comparable Store Sales by Division
The Company’s comparable store sales by division for the second quarter of Fiscal 2025 and Fiscal 2024 were as follows:
|
Second Quarter
|
|
|
FY2025 |
FY2024 |
|
|
|
Marmaxx ( |
+ |
+ |
HomeGoods ( |
+ |
+ |
TJX Canada |
+ |
+ |
TJX International ( |
+ |
+ |
|
|
|
TJX |
+ |
+ |
1Comparable store sales excludes e-commerce. 2Includes TJ Maxx, Marshalls, and Sierra stores. 3Includes HomeGoods and Homesense stores. |
Net Sales by Division
The Company’s net sales by division for the second quarter of Fiscal 2025 and Fiscal 2024 were as follows:
|
Second Quarter Net Sales
|
Second Quarter
|
Second Quarter
|
|
|
FY2025 |
FY2024 |
||
|
|
|
|
|
Marmaxx ( |
|
|
+ |
N.A. |
HomeGoods ( |
|
|
+ |
N.A. |
TJX Canada |
|
|
+ |
+ |
TJX International ( |
|
|
+ |
+ |
|
|
|
|
|
TJX |
|
|
+ |
+ |
1Net sales in TJX Canada and TJX International include the impact of foreign currency exchange rates. 2Reflects net sales adjusted for the impact of foreign currency; see Impact of Foreign Currency Exchange Rates, below. 3Includes TJ Maxx, Marshalls, and Sierra stores as well as their e-commerce sites. 4Includes HomeGoods and Homesense stores (and homegoods.com for FY2024 only). 5Includes TK Maxx and Homesense stores, as well as TK Maxx e-commerce sites in |
Margins
For the second quarter of Fiscal 2025, the Company’s pretax profit margin was
The Company’s second quarter Fiscal 2025 pretax profit margin was above the high-end of its plan by 0.4 percentage points primarily due to a benefit from lower freight costs and stronger sales, partially offset by higher incentive compensation accruals and a contribution to the TJX Foundation.
Gross profit margin for the second quarter of Fiscal 2025 was
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
The movement in foreign currency exchange rates had a neutral impact on the Company’s net sales growth in the second quarter and the first half of Fiscal 2025 versus the prior year. The overall net impact of foreign currency exchange rates was neutral for the Company’s second quarter and first half Fiscal 2025 diluted earnings per share.
A table detailing the impact of foreign currency on TJX’s net sales and pretax 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 diluted earnings per share does not include the impact currency exchange rates have on various transactions, which the Company refers to as “transactional foreign exchange.”
Inventory
Total inventories as of August 3, 2024 were
Cash and Shareholder Distributions
For the second quarter of Fiscal 2025, the Company generated
During the second quarter of Fiscal 2025, the Company returned a total of
During the first half of Fiscal 2025, the Company returned a total of
The Company continues to expect to repurchase approximately
Third Quarter and Full Year Fiscal 2025 Outlook
For the third quarter of Fiscal 2025, the Company is planning consolidated comparable store sales to be up
For the full year Fiscal 2025, the Company is now planning consolidated comparable store sales to be up approximately
Investment in Brands for Less
The Company announced today that it has signed a definitive agreement to make an investment of approximately
Stores by Concept
During the fiscal quarter ended August 3, 2024, the Company increased its store count by 29 stores overall to a total of 5,001 stores and increased square footage by
|
Store Locations1
|
Gross Square Feet
|
||
|
Beginning |
End |
Beginning |
End |
|
|
|
|
|
In the |
|
|
|
|
TJ Maxx |
1,322 |
1,326 |
35.7 |
35.9 |
Marshalls |
1,201 |
1,204 |
33.8 |
33.8 |
HomeGoods |
922 |
930 |
21.5 |
21.7 |
Sierra |
97 |
101 |
2.0 |
2.1 |
Homesense |
59 |
62 |
1.6 |
1.7 |
In |
|
|
|
|
Winners |
303 |
304 |
8.3 |
8.3 |
HomeSense |
158 |
160 |
3.7 |
3.8 |
Marshalls |
106 |
108 |
2.8 |
2.9 |
In |
|
|
|
|
TK Maxx |
644 |
645 |
17.9 |
17.9 |
Homesense |
78 |
77 |
1.5 |
1.4 |
In |
|
|
|
|
TK Maxx |
82 |
84 |
1.7 |
1.7 |
|
|
|
|
|
TJX |
4,972 |
5,001 |
130.5 |
131.2 |
1Store counts above include both banners within a combo or a superstore.
About The TJX Companies, Inc.
The TJX Companies, Inc., a Fortune 100 company, is the leading off-price retailer of apparel and home fashions in the
Second Quarter Fiscal 2025 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 second quarter Fiscal 2025 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 (toll free) or (203) 369-0233 through Tuesday, August 27, 2024, or at TJX.com.
Non-GAAP Financial Information
The Company reports its financial results in accordance with generally accepted accounting principles in the
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
Various statements made in this release are forward-looking, and are inherently subject to 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, including, among others, statements regarding the Company’s anticipated operating and financial performance, business plans and prospects, dividends and share repurchases, third quarter, fourth quarter, and full-year Fiscal 2025 outlook. These statements are typically accompanied by the words “aim,” “anticipate,” “aspire,” “believe,” “continue,” “could,” “should,” “estimate,” “expect,” “forecast,” “goal,” “hope,” “intend,” “may,” “plan,” “project,” “potential,” “seek,” “strive,” “target,” “will,” “would,” or similar words, although not all forward-looking statements contain these identifying words. Each forward-looking statement contained in this press release is inherently subject to risks, uncertainties and potentially inaccurate assumptions that could cause actual results to differ materially from those expressed or implied by such statement. We cannot guarantee that the results and other expectations expressed, anticipated or implied in any forward-looking statement will be realized. Applicable risks and uncertainties include, among others, execution of buying strategy and inventory management; customer trends and preferences; competition; various marketing efforts; operational and business expansion; management of large size and scale; merchandise sourcing and transport; data security and maintenance and development of information technology systems; labor costs and workforce challenges; personnel recruitment, training and retention; corporate and retail banner reputation; evolving corporate governance and public disclosure regulations and expectations with respect to environmental, social and governance matters; expanding international operations; fluctuations in quarterly operating results and market expectations; inventory or asset loss; cash flow; mergers, acquisitions, or business investments and divestitures, closings or business consolidations; real estate activities; economic conditions and consumer spending; market instability; severe weather, serious disruptions or catastrophic events; disproportionate impact of disruptions during this fiscal year; commodity availability and pricing; 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 set forth under Item 1A of our most recent Annual Report on Form 10-K, as well as other information we file with the Securities and Exchange Commission ( “SEC”).
We caution investors, potential investors and others not to place considerable reliance on the forward-looking statements contained in this release. You are encouraged to read any further disclosures we may make in our future reports to the SEC, available at www.sec.gov, on our website, or otherwise. Our forward-looking statements in this release speak only as of the date of this release, and we undertake no obligation to update or revise any of these statements, unless required by law, even if experience or future changes make it clear that any projected results expressed or implied in such statements will not be realized. Our business is subject to substantial risks and uncertainties, including those referenced above. Investors, potential investors, and others should give careful consideration to these risks and uncertainties.
The TJX Companies, Inc. and Consolidated Subsidiaries |
|||||||||||
Financial Summary |
|||||||||||
(Unaudited) |
|||||||||||
(In Millions Except Per Share Amounts) |
|||||||||||
|
Thirteen Weeks Ended |
Twenty-Six Weeks Ended |
|||||||||
|
August 3,
|
July 29,
|
August 3,
|
July 29,
|
|||||||
|
|
|
|
|
|||||||
Net sales |
$ |
13,468 |
$ |
12,758 |
$ |
25,947 |
$ |
24,541 |
|||
|
|
|
|
|
|||||||
Cost of sales, including buying and occupancy costs |
|
9,380 |
|
8,910 |
|
18,119 |
|
17,284 |
|||
Selling, general and administrative expenses |
|
2,666 |
|
2,559 |
|
5,066 |
|
4,797 |
|||
Interest (income) expense, net |
|
(46) |
|
(38) |
|
(96) |
|
(75) |
|||
|
|
|
|
|
|||||||
Income before income taxes |
|
1,468 |
|
1,327 |
|
2,858 |
|
2,535 |
|||
Provision for income taxes |
|
369 |
|
338 |
|
689 |
|
655 |
|||
|
|
|
|
|
|||||||
Net income |
$ |
1,099 |
$ |
989 |
$ |
2,169 |
$ |
1,880 |
|||
|
|
|
|
|
|||||||
Diluted earnings per share |
$ |
0.96 |
$ |
0.85 |
$ |
1.89 |
$ |
1.62 |
|||
|
|
|
|
|
|||||||
Cash dividends declared per share |
$ |
0.375 |
$ |
0.3325 |
$ |
0.75 |
$ |
0.665 |
|||
|
|
|
|
|
|||||||
Weighted average common shares – diluted |
|
1,144 |
|
1,161 |
|
1,145 |
|
1,163 |
|||
The TJX Companies, Inc. and Consolidated Subsidiaries |
|||||
Condensed Balance Sheets |
|||||
(Unaudited) |
|||||
(In Millions) |
|||||
|
August 3,
|
July 29,
|
|||
|
|
|
|||
Assets: |
|
|
|||
Current assets: |
|
|
|||
Cash and cash equivalents |
$ |
5,250 |
$ |
4,550 |
|
Accounts receivable and other current assets |
|
1,170 |
|
1,203 |
|
Merchandise inventories |
|
6,470 |
|
6,585 |
|
|
|
|
|||
Total current assets |
|
12,890 |
|
12,338 |
|
|
|
|
|||
Net property at cost |
|
6,968 |
|
6,166 |
|
|
|
|
|||
Operating lease right of use assets |
|
9,513 |
|
9,406 |
|
Goodwill |
|
95 |
|
95 |
|
Other assets |
|
1,089 |
|
917 |
|
|
|
|
|||
Total assets |
$ |
30,555 |
$ |
28,922 |
|
|
|
|
|||
Liabilities and shareholders' equity: |
|
|
|||
Current liabilities: |
|
|
|||
Accounts payable |
$ |
4,503 |
$ |
4,438 |
|
Accrued expenses and other current liabilities |
|
4,497 |
|
4,261 |
|
Current portion of operating lease liabilities |
|
1,621 |
|
1,618 |
|
|
|
|
|||
Total current liabilities |
|
10,621 |
|
10,317 |
|
|
|
|
|||
Other long-term liabilities |
|
960 |
|
915 |
|
Non-current deferred income taxes, net |
|
162 |
|
132 |
|
Long-term operating lease liabilities |
|
8,166 |
|
8,089 |
|
Long-term debt |
|
2,864 |
|
2,861 |
|
|
|
|
|||
Shareholders’ equity |
|
7,782 |
|
6,608 |
|
|
|
|
|||
Total liabilities and shareholders' equity |
$ |
30,555 |
$ |
28,922 |
|
|
|
|
The TJX Companies, Inc. and Consolidated Subsidiaries |
|||||
Condensed Statements of Cash Flows |
|||||
(Unaudited) |
|||||
(In Millions) |
|||||
|
Twenty-Six Weeks Ended |
||||
|
August 3,
|
July 29,
|
|||
Cash flows from operating activities: |
|
|
|||
Net income |
$ |
2,169 |
$ |
1,880 |
|
Adjustments to reconcile net income to net cash provided by operating activities: |
|||||
Depreciation and amortization |
|
529 |
|
467 |
|
Deferred income tax provision |
|
43 |
|
16 |
|
Share-based compensation |
|
84 |
|
70 |
|
Changes in assets and liabilities: |
|
|
|||
(Increase) in accounts receivable and other assets |
|
(14) |
|
(15) |
|
(Increase) in merchandise inventories |
|
(512) |
|
(734) |
|
(Increase) in income taxes recoverable |
|
(54) |
|
(28) |
|
Increase in accounts payable |
|
648 |
|
619 |
|
(Decrease) in accrued expenses and other liabilities |
|
(449) |
|
(206) |
|
(Decrease) increase in net operating lease liabilities |
|
(11) |
|
0 |
|
Other, net |
|
(67) |
|
17 |
|
Net cash provided by operating activities |
|
2,366 |
|
2,086 |
|
|
|
|
|||
Cash flows from investing activities: |
|
|
|||
Property additions |
|
(982) |
|
(820) |
|
Purchase of investments |
|
(23) |
|
(17) |
|
Sales and maturities of investments |
|
15 |
|
18 |
|
Net cash (used in) investing activities |
|
(990) |
|
(819) |
|
|
|
|
|||
Cash flows from financing activities: |
|
|
|||
Repayment of debt |
|
— |
|
(500) |
|
Payments for repurchase of common stock |
|
(1,068) |
|
(1,041) |
|
Cash dividends paid |
|
(803) |
|
(725) |
|
Proceeds from issuance of common stock |
|
191 |
|
81 |
|
Other |
|
(42) |
|
(29) |
|
Net cash (used in) financing activities |
|
(1,722) |
|
(2,214) |
|
|
|
|
|||
Effect of exchange rate changes on cash |
|
(4) |
|
20 |
|
|
|
|
|||
Net (decrease) in cash and cash equivalents |
|
(350) |
|
(927) |
|
Cash and cash equivalents at beginning of year |
|
5,600 |
|
5,477 |
|
|
|
|
|||
Cash and cash equivalents at end of period |
$ |
5,250 |
$ |
4,550 |
|
The TJX Companies, Inc. and Consolidated Subsidiaries |
|||||||||||
Selected Information by Major Business Segment |
|||||||||||
(Unaudited) |
|||||||||||
(In Millions) |
|||||||||||
|
Thirteen Weeks Ended |
Twenty-Six Weeks Ended |
|||||||||
|
August 3,
|
July 29,
|
August 3,
|
July 29,
|
|||||||
Net sales: |
|
|
|
|
|||||||
In |
|
|
|
|
|||||||
Marmaxx |
$ |
8,445 |
$ |
7,903 |
$ |
16,195 |
$ |
15,269 |
|||
HomeGoods |
|
2,101 |
|
2,011 |
|
4,180 |
|
3,977 |
|||
TJX Canada |
|
1,244 |
|
1,223 |
|
2,357 |
|
2,261 |
|||
TJX International |
|
1,678 |
|
1,621 |
|
3,215 |
|
3,034 |
|||
Total net sales |
$ |
13,468 |
$ |
12,758 |
$ |
25,947 |
$ |
24,541 |
|||
Segment profit: |
|
|
|
|
|||||||
In |
|
|
|
|
|||||||
Marmaxx |
$ |
1,191 |
$ |
1,084 |
$ |
2,288 |
$ |
2,112 |
|||
HomeGoods |
|
191 |
|
175 |
|
389 |
|
319 |
|||
TJX Canada |
|
187 |
|
192 |
|
324 |
|
309 |
|||
TJX International |
|
73 |
|
32 |
|
134 |
|
70 |
|||
Total segment profit |
|
1,642 |
|
1,483 |
|
3,135 |
|
2,810 |
|||
General corporate expense |
|
220 |
|
194 |
|
373 |
|
350 |
|||
Interest (income) expense, net |
|
(46) |
|
(38) |
|
(96) |
|
(75) |
|||
Income before income taxes |
$ |
1,468 |
$ |
1,327 |
$ |
2,858 |
$ |
2,535 |
|||
The TJX Companies, Inc. and Consolidated Subsidiaries
Notes to Consolidated Condensed Statements
-
During the second quarter ended August 3, 2024, the Company returned
to shareholders, repurchasing and retiring 5.1 million shares of its common stock at a cost of$982 million and paid$559 million in shareholder dividends. During the six months ended August 3, 2024, the Company returned$423 million to shareholders, repurchasing and retiring 10.4 million shares of its common stock at a cost of$1.9 billion and paid$1.1 billion in shareholder dividends. During the second quarter of Fiscal 2025, the Company completed the$800 million that remained as of February 3, 2024 from the previously announced stock repurchase program. In February 2024, the Company announced that the Board of Directors had approved a new stock repurchase program that authorizes the repurchase of up to an additional$1.0 billion of TJX common stock from time to time. Under this program, TJX had approximately$2.5 billion available for repurchase as of August 3, 2024.$2.5 billion
View source version on businesswire.com: https://www.businesswire.com/news/home/20240820684767/en/
Debra McConnell
Global Communications
(508) 390-2323
Source: The TJX Companies, Inc.