TJX earnings top estimates; Q2 off to ‘good start’
The TJX Companies posted better-than-expected first-quarter profit and raised its full-year guidance even as its sales fell short.
The parent company of T.J. Maxx, Marmaxx, HomeGoods and Marshalls reported that its net income totaled $891 million, or $0.76 a share, for the quarter ended April 29, up from $587 million, or $0.49 a share, in the year-age period. Analysts had expected earnings per share of $0.72.
Sales rose to $11.783 billion from $11.406 billion a year ago.
Total comparable store sales grew 3%. By division, comp sales rose 5% at the company’s largest division, Marmaxx (T.J. Maxx, Marshalls and Sierra stores). Comp-sales grew 1% at TJX Canada and 4% at TJX International.
Comp sales fell 7% at HomeGoods (also includes Homesense stores) as the pandemic-fueled home improvement and décor buying spree of the past three years continues to lose steam.
“I am very pleased with our first quarter performance, said Ernie Herrman, CEO and president of The TJX Companies. “Our pretax profit margin and earnings per share both significantly exceeded our plan and our 3% comparable store sales increase was at the high end of our plan.”
Herrman said that the second quarter is off to a good start and the company is seeing “phenomenal” off-price buying opportunities in the marketplace.
“We are set up extremely well to continue shipping fresh and compelling merchandise to our stores and online throughout the spring and summer,” he added. “Going forward, I am confident that we have significant opportunities to grow sales, drive customer traffic, capture market share, and improve the profitability of our company.”
For its current year (fiscal 2024), TJX expects same-store sales growth of 2% to 3% and for earnings to range from $3.49 to $3.58 per share.
“With our above-plan profit performance we are raising our full-year guidance for both pretax profit margin and earnings per share,” stated Herrman. “The strength and flexibility of our off-price business model, depth of our organization’s expertise, and our wide demographic reach all give me great confidence in our ability to continue to succeed in today’s retail environment.”
As of April 29, 2023, the company operated a total of 4,865 stores in nine countries, the United States, Canada, the United Kingdom, Ireland, Germany, Poland, Austria, the Netherlands, and Australia, and five e-commerce sites. These include 1,304 T.J. Maxx, 1,189 Marshalls, 901 HomeGoods, 81 Sierra, and 49 Homesense stores in the United States; 298 Winners, 152 HomeSense, and 106 Marshalls stores in Canada; 632 T.K. Maxx and 78 Homesense stores in Europe; and 75 T.K. Maxx stores in Australia.