The TJX Companies, Inc. Reports Strong 18% Increase in Q2 FY14 EPS; Raises Full-Year Guidance

  The TJX Companies, Inc. Reports Strong 18% Increase in Q2 FY14 EPS; Raises
  Full-Year Guidance

Business Wire

FRAMINGHAM, Mass. -- August 20, 2013

The TJX Companies, Inc. (NYSE: TJX), the leading off-price retailer of apparel
and home fashions in the U.S. and worldwide, today announced sales and
earnings results for the second quarter ended August 3, 2013. Net sales for
the second quarter of Fiscal 2014 increased 8% to $6.4 billion. Consolidated
comparable store sales for the quarter increased 4% over last year’s reported
7% increase. Net income for the second quarter was $480 million. Second
quarter diluted earnings per share were $.66, an 18% increase over last year’s
$.56, which represented a 24% increase over the prior year’s EPS.

For the first half of Fiscal 2014, net sales were $12.6 billion, an 8%
increase over last year. Consolidated comparable store sales for the first
half of Fiscal 2014 increased 3% over last year’s reported 8% increase. Net
income for the first half of Fiscal 2014 was $932 million. First half Fiscal
2014 diluted earnings per share were $1.28, a 15% increase over last year’s
$1.11, which represented a 32% increase over the prior year’s adjusted EPS.

Carol Meyrowitz, Chief Executive Officer of The TJX Companies, Inc., stated,
“We are very pleased with our above-plan second quarter results which were
achieved over high year-over-year comparisons for quarterly comp sales and EPS
growth. Consolidated comparable store sales increased 4% over a 7% reported
increase last year and earnings per share grew 18% over last year’s 24%
increase. With our above-plan second quarter results, we are raising our
full-year guidance. The third quarter is off to a solid start and we see many
opportunities for the second half of the year and beyond. We are in an
excellent inventory position, which gives us the flexibility to capitalize on
the great brands and fashions available to us in the marketplace. We have
exciting marketing and in-store initiatives planned, and above all, as always,
we will be offering consumers amazing values! Further, we see great growth
opportunities in our brick-and-mortar business and are excited about the
long-term potential of e-commerce as another avenue to bring our values to
even more consumers. We remain confident that our strong top- and bottom-line
growth will continue and we will grow TJX to be a $40 billion-plus company!”

Sales by Business Segment

The Company’s comparable store sales and net sales by division, in the second
quarter, were as follows:

                                        
               Second Quarter            Second Quarter
               Comparable Store Sales^1  Net Sales ($ in millions)^2,3
              FY2014       FY2013       FY2014          FY2013
In the U.S.:                                          
Marmaxx^4,5    +4%          +7%          $4,295          $3,976
HomeGoods      +8%          +9%          $690            $598
International:                                        
TJX Canada     +2%          +5%          $679            $661
TJX Europe     +6%          +10%         $778            $711
                                                     
TJX            +4%          +7%          $6,442          $5,946

^1Comparable store sales outside the U.S. calculated on a constant currency
basis, which removes the effect of changes in currency exchange rates. ^2Sales
in Canada and Europe include the impact of foreign currency exchange rates.
See below. ^3Figures may not foot due to rounding. ^4Combination of T.J. Maxx
and Marshalls. ^ 5Net Sales for FY2014 include Sierra Trading Post.

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 affect the magnitude of these translations and
adjustments, and can have a material impact when there is significant
volatility in currency exchange rates.

The movement in foreign currency exchange rates had a one percentage point
negative impact on consolidated net sales growth in the second quarter of
Fiscal 2014 versus the prior year. The overall net impact of foreign currency
exchange rates had a neutral impact on second quarter Fiscal 2014 earnings per
share, compared with a neutral impact last year.

A table detailing the impact of foreign currency on TJX pretax earnings and
margins, as well as those of its international businesses, can be found in the
Investor Information section of the Company’s website, www.tjx.com.

Margins

For the second quarter of Fiscal 2014, the Company’s consolidated pretax
profit margin was 12.0%, up 0.5 percentage points over the prior year.

The gross profit margin for the second quarter of Fiscal 2014 was 28.8%, 0.7
percentage points above last year’s margin. This increase was driven primarily
by strong merchandise margin improvement and buying and occupancy expense
leverage on the above-plan sales.

Selling, general and administrative costs as a percent of sales were 16.7% in
the second quarter, a 0.2 percentage point increase over last year’s ratio,
primarily due to increased investments in marketing and the Company’s
e-commerce businesses, as well as the Company’s contribution to The TJX
Foundation.

Inventory

Total inventories as of August 3, 2013, were $3.2 billion, compared with $3.0
billion at the end of the second quarter last year. Consolidated inventories
on a per-store basis at August 3, 2013, including the distribution centers,
but excluding the Company’s e-commerce businesses, were down 5% (down 4% on a
constant currency basis). The Company enters the third quarter in an excellent
inventory position which gives it the flexibility to take advantage of the
great buying opportunities it is seeing in the marketplace.

Shareholder Distributions

During the second quarter, the Company repurchased a total of $325 million of
TJX stock, retiring 6.4 million shares. For the first half of Fiscal 2014, the
Company spent a total of $625 million in repurchases of TJX stock, retiring
12.9 million shares and it continues to expect to repurchase approximately
$1.3 billion to $1.4 billion of TJX stock in Fiscal 2014. The Company may
adjust the amount of this spending up or down depending on various factors.

Third Quarter and Full Year Fiscal 2014 Outlook

For the third quarter of Fiscal 2014, the Company expects diluted earnings per
share to be in the range of $.69 to $.72, which would represent an 11% to 16%
increase over last year’s $.62 per share. This outlook is based upon estimated
consolidated comparable store sales growth of 2% to 3%.

As mentioned above, for the fiscal year ending February 1, 2014, the Company
is raising its guidance for diluted earnings per share to $2.74 to $2.80
versus $2.55 in Fiscal 2013. Excluding the approximately $.08 benefit from the
53^rd week in the Company’s Fiscal 2013 calendar, this guidance would
represent an 11% to 13% increase over the adjusted $2.47 in Fiscal 2013. This
updated guidance now includes an additional $.01 per share negative impact
from foreign currency exchange rates. Further, this outlook is now based upon
estimated consolidated comparable store sales growth of 2% to 3%.

The Company’s earnings guidance for the third quarter and full year Fiscal
2014 assumes that currency exchange rates will remain unchanged from current
levels.

Stores by Concept

During the second quarter ended August 3, 2013, the Company increased its
store count by a net of 19 stores. The Company increased square footage by 4%
over the same period last year.

                                       
                      Store Locations    Gross Square Feet*
                      Second Quarter      Second Quarter
                                        (in millions)
                    Beginning  End    Beginning    End
In the U.S.:                                     
T.J. Maxx            1,047      1,052  30.5         30.6
Marshalls            911        914    28.2         28.3
HomeGoods            426        430    10.7         10.8
Sierra Trading Post  4          4      0.1          0.1
TJX Canada:                                      
Winners              226        226    6.6          6.6
HomeSense            89         89     2.1          2.1
Marshalls            21         22     0.7          0.7
TJX Europe:                                      
T.K. Maxx            352        355    11.1         11.2
HomeSense            24         27     0.5          0.6
                                                
TJX                  3,100      3,119  90.4         90.9

*Square 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. The Company operates 1,052 T.J. Maxx, 914
Marshalls, 430 HomeGoods and 4 Sierra Trading Post stores as well as
SierraTradingPost.com in the United States; 226 Winners, 89 HomeSense, and 22
Marshalls stores in Canada; and 355 T.K. Maxx and 27 HomeSense stores in
Europe. TJX’s press releases and financial information are also available at
www.tjx.com.

Fiscal 2014 Second Quarter Earnings Conference Call

At 11:00 a.m. ET today, Carol Meyrowitz, Chief Executive Officer of TJX, will
hold a conference call with stock analysts to discuss the Company’s second
quarter Fiscal 2014 results, operations and business trends. A real-time
webcast of the call will be available at www.tjx.com. A replay of the call
will also be available by dialing (866) 367-5577 through Tuesday, August 27,
2013, or at www.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 the
attached appendix. 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 at the
Investor Information section of www.tjx.com after they are no longer available
by telephone as well as 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 Investor
Information section at www.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
expansion and management of large size and scale; customer trends and
preferences; market, banner, geographic and category expansion; marketing,
advertising and promotional programs; competition; personnel recruitment and
retention and costs of labor; global economic conditions and consumer
spending; data security; information systems and new technology; seasonal
influences; adverse or unseasonable weather; serious disruptions and
catastrophic events; corporate and banner reputation; merchandise quality and
safety; expanding international operations; merchandise importing; commodity
pricing; fluctuations in currency exchange rates; fluctuations in quarterly
operating results and market expectations; acquisitions, business investments
and divestitures; compliance with laws, regulations and orders; changes in
laws and regulations; outcomes of litigation, legal matters and proceedings;
tax matters; real estate activities; 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)
                                                
                       13 Weeks Ended             26 Weeks Ended
                       August 3,     July 28,      August 3,      July 28,
                                                              
                       2013          2012          2013           2012
                                                               
Net sales              $ 6,442,424   $ 5,945,559   $ 12,632,033   $ 11,743,645
                                                                  
Cost of sales,
including buying and     4,586,739     4,275,073     9,020,272      8,440,801
occupancy costs
Selling, general and
administrative           1,074,320     978,514       2,093,229      1,920,640
expenses
Interest expense,       8,919        9,182        14,201        18,009
net
                                                                  
Income before
provision for income     772,446       682,790       1,504,331      1,364,195
taxes
Provision for income    292,887      261,698      571,882       523,903
taxes
                                                                  
Net income             $ 479,559     $ 421,092     $ 932,449      $ 840,292
                                                                  
Diluted earnings per   $ 0.66        $ 0.56        $ 1.28         $ 1.11
share
                                                                  
Cash dividends         $ 0.145       $ 0.115       $ 0.29         $ 0.23
declared per share
                                                                  
Weighted average
common shares –          728,599       751,243       730,750        753,721
diluted
                                                                    


The TJX Companies, Inc. and Consolidated Subsidiaries
Condensed Balance Sheets
(Unaudited)
(In Millions)

                                                            
                                                   August 3,   July 28,
                                                   2013        2012
                                                               
ASSETS
Current assets:
Cash and cash equivalents                          $ 1,858.8   $ 1,620.4
Short-term investments                               231.2       176.3
Accounts receivable and other current assets         580.2       452.8
Current deferred income taxes, net                   91.5        83.5
Merchandise inventories                             3,188.5    3,007.7
                                                               
Total current assets                                5,950.2    5,340.7
                                                               
Property and capital leases, net of depreciation     3,377.8     2,855.8
Other assets                                         283.9       260.1
Goodwill and tradename, net of amortization         314.1      180.0
                                                               
TOTAL ASSETS                                       $ 9,926.0   $ 8,636.6
                                                               
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable                                   $ 1,940.3   $ 1,863.1
Accrued expenses and other current liabilities      1,502.6    1,362.4
                                                               
Total current liabilities                           3,442.9    3,225.5
                                                               
Other long-term liabilities                          983.5       860.1
Non-current deferred income taxes, net               375.3       386.5
Long-term debt                                       1,274.2     774.5
                                                               
Shareholders’ equity                                3,850.1    3,390.0
                                                               
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY         $ 9,926.0   $ 8,636.6
                                                               


The TJX Companies, Inc. and Consolidated Subsidiaries
Condensed Statements of Cash Flows
(Unaudited)
(In Millions)

                                                    26 Weeks Ended
                                                     August 3,    July 28,
                                                     2013          2012
                                                                   
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income                                           $ 932.4       $ 840.3
Depreciation and amortization                          266.0         246.5
Deferred income tax provision                          42.8          30.8
Share-based compensation                               35.7          29.9
(Increase) decrease in accounts receivable and         (34.2   )     32.6
other assets
(Increase) in merchandise inventories                  (198.4  )     (59.7   )
Increase in accounts payable                           24.3          218.6
(Decrease) in accrued expenses and other               (226.6  )     (10.7   )
liabilities
Other                                                 (30.7   )    (20.6   )
                                                                   
Net cash provided by operating activities             811.3       1,307.7 
                                                                   
CASH FLOWS FROM INVESTING ACTIVITIES:
Property additions                                     (497.0  )     (438.9  )
Purchases of short-term investments                    (196.2  )     (136.6  )
Sales and maturities of short-term investments         189.4         54.0
Other                                                 2.7         0.5     
Net cash (used in) investing activities               (501.1  )    (521.0  )
                                                                   
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of long-term debt               499.6         -
Payments for repurchase of common stock                (627.6  )     (597.0  )
Proceeds from issuance of common stock                 64.3          61.3
Cash dividends paid                                    (187.3  )     (155.7  )
Other                                                 28.9        24.5    
Net cash (used in) financing activities               (222.1  )    (666.9  )
                                                                   
Effect of exchange rate changes on cash               (41.3   )    (6.5    )
                                                                   
Net increase in cash and cash equivalents              46.8          113.3
Cash and cash equivalents at beginning of year        1,812.0     1,507.1 
                                                                   
Cash and cash equivalents at end of period           $ 1,858.8    $ 1,620.4 
                                                                   


The TJX Companies, Inc. and Consolidated Subsidiaries
Selected Information by Major Business Segment
(Unaudited)
(In Thousands)

                      13 Weeks Ended             26 Weeks Ended
                       August 3,     July 28,      August 3,      July 28,
                                                               
                       2013          2012          2013           2012
Net sales:                                                     
In the United
States:
Marmaxx                $ 4,295,346   $ 3,976,051   $ 8,431,095    $ 7,865,109
HomeGoods                690,123       597,714     1,379,653        1,193,436
TJX Canada               679,364       660,703     1,324,860        1,300,912
TJX Europe              777,591      711,091     1,496,425       1,384,188
Total net sales        $ 6,442,424   $ 5,945,559   $ 12,632,033   $ 11,743,645
                                                                  
Segment profit:
In the United
States:
Marmaxx                $ 647,978     $ 581,379     $ 1,282,278    $ 1,186,007
HomeGoods                81,170        60,531      170,233          129,964
TJX Canada               90,776        92,661      165,082          163,726
TJX Europe              40,529       24,724      56,893          36,453
Total segment profit     860,453       759,295     1,674,486        1,516,150
                                                                  
General corporate        79,088        67,323      155,954          133,946
expenses
Interest expense,       8,919        9,182       14,201          18,009
net
Income before
provision for income   $ 772,446     $ 682,790     $ 1,504,331    $ 1,364,195
taxes
                                                                    

            The TJX Companies, Inc. and Consolidated Subsidiaries
                  Notes to Consolidated Condensed Statements

1.During the second quarter ended August 3, 2013, TJX repurchased 6.4
    million shares of its common stock at a cost of $325 million. During the
    six months ended August 3, 2013, TJX repurchased 12.9 million shares of
    its common stock at a cost of $625 million. On February 5, 2013 the Board
    of Directors approved an additional $1.5 billion stock repurchase program.
    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.
2.On December 21, 2012 TJX purchased Sierra Trading Post (STP), an off-price
    internet retailer for approximately $200 million, subject to customary
    post-closing adjustments. The operating results of STP since the date of
    acquisition are not material and have been included with the Company’s
    Marmaxx segment.
3.On May 2, 2013 TJX issued $500 million of 2.50% ten year notes. The
    Company intends to use the proceeds from the notes offering for working
    capital and other general corporate purposes.

                           THE TJX COMPANIES, INC.
                 Reconciliation of GAAP and Non-GAAP measures

The Company reports its financial results in accordance with U.S. generally
accepted accounting principles (GAAP). However, management believes that
certain non-GAAP financial measures used in managing the business may provide
users of this financial information with additional meaningful comparisons
between current results and results in prior operating periods. Management
believes excluding certain items that impact the overall comparability among
periods can provide additional information on underlying trends of the
business. Management also uses these non-GAAP financial measures in making
financial, operating and planning decisions and in evaluating the Company's
performance. The table here provides supplemental financial data and
corresponding reconciliations to GAAP financial measures. Non-GAAP financial
measures should be viewed in addition to, and not as an alternative for, the
Company’s reported results prepared in accordance with GAAP.

  Reconciliation of GAAP Basis Earnings Per Share from Continuing Operations

                                                        
                                         First Six Months
                                                           
                                         FY2014   FY2013   FY2012
                                                           
Reported EPS                             $1.28    $1.11    $0.79
Y/Y Growth                               15%      41%
Adjusted for non-operating items:
Impact of A.J. Wright Store Closing      -        -        $0.04
Store Conversion/Grand Re-Openings Costs -        -        $0.02
Adjusted EPS from continuing operations  $1.28    $1.11    $0.84
Y/Y Growth (Adjusted Basis)              15%      32%

Note: Figures may not foot due to rounding.

Contact:

The TJX Companies, Inc.
Sherry Lang or Debra McConnell
Global Communications
(508) 390-2323
 
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