TJX wins across the board in Q4 with increases across all brands

TJX. Cos. showed the strength of its off-price model in the fourth quarter with sales and earnings that beat expectations amid increased store traffic. All its banners came up as winners. 

On the company’s quarterly earnings call, CEO Ernie Herrman said “TJX is far from finished growing.” The retailer ended the year with 4,529 stores, which represented a 4% increase in square footage over the previous year. TJX executives on the call noted that even the shorter 2019 holiday shopping season did not take away from the company’s growth. 

“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,” Herrman stated in a release. “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.”

The off-price giant’s income totaled $984.8 million, or $0.81 per share, in the quarter ended Feb. 1, up from $841.5 million, or $0.68 per share, in the year-ago period. The Street estimate was $0.77 a share.

Sales increased 10% to $12.2 billion, up from $11.1 billion the prior year. Analysts had expected sales of $11.8 billion.

Same-store sales rose 6%, also better than expected. All of the company's divisions reported same-store sales growth of 4% or higher. 

By division, same-store sales rose 6% at Marmaax (T.J. Maxx and Marshalls); 5% at Home Goods; 4% at TJX Canada; and 10% at TJX International.  

For the full year, net sales rose 7% to $41.7 billion and consolidated comparable store sales increased 4%. Net income was $3.3 billion, and diluted earnings per share were $2.67, a 10% increase versus $2.43 in the prior year.  

“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,” Herrman stated. “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.”

Herrman’s optimism was shared by Neil Saunders, managing director of GlobalData Retail.

“Looking ahead, we remain positive about TJX,” he commented. “While the competitive environment is intensifying in off-price, TJX stands head and shoulders above most other players. This, and a consumer mindset that remains predisposed to saving money, bodes well.” For more analysis, click here.

For the first quarter TJX expects earnings per share in the range of 59 cents to 60 cents, below the 61 cents analysts had forecast.