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TJX Q4 sales, profits top estimates as customers seek out lower-priced clothing

TJX’s fourth-quarter net sales grew 4.8% to $14.52 billion.

The TJX Cos. reported fourth-quarter profit that matched expectations and sales that topped estimates, fueled by strength in apparel and accessories.

President and CEO Ernie Herrman struck a confident note on TJX's earnings call and told investors that the company, which ended its fiscal year with 4,835 stores across nine countries, had the potential to open another 1,400 locations in its existing markets.  

“I am very confident in our plans to grow TJX into an increasingly profitable $60 billion-plus revenue company over the long term,” he said. 

The off-pricer reported that its net income rose to $1.04 billion, or $0.89 a share, for the quarter ended Jan. 28, which was in line with analysts’ estimates and up from $940 million, or $0.78 a share, in the year-ago period. 

Net sales grew 4.8% to $14.52 billion, topping analysts’ estimates of $14.07 billion and the company’s own expectations of $14.1 billion. Same-store sales rose 4% beat, also better than expected.

By division, same-store sales rose 7% at Marmaxx (made up of T.J. Maxx, Marshalls, and Sierra stores) and fell by 7% at HomeGoods.

For the full year, TJX reported net sales were $49.9 billion, an increase of 3% over last year. Total U.S. comp sales were up 4%. Net income was $3.5 billion.

“During the year, our apparel businesses, including accessories, across the company were strong,” stated Herrman in the earnings release. “Sales at our home businesses overall were softer as we saw extraordinary growth during the two prior years when consumers focused on purchases for their homes.”

For the first quarter, the company expects earnings per share of $0. 68 to $0.71, below analysts’ expectations of $0. 74 cents. It forecasts same-store sales growth of 2% to 3% versus expectations of 2.3% growth.

Herrman noted that fiscal 2024 is off to a strong start “and we remain confident in improving our profitability this year and reaching our pretax profit margin target of 10.6% by fiscal 2025.”

We are excited about our plans to drive sales and customer traffic, and are laser-focused on initiatives to drive profitability this year and beyond," he said on the earnings call.

Herrman added that the availability of quality-branded merchandise is "phenomenal."

"We are in a great position to take advantage of the opportunities we are seeing in the marketplace," he said..

As of January 28, 2023, the company operated a total of 4,835 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 1,299 T.J. Maxx, 1,183 Marshalls, 894 HomeGoods, 78 Sierra, and 46 Homesense stores, as well as, and, in the U.S; 297 Winners, 151 Homesense, and 106 Marshalls stores in Canada; 629 T.K. Maxx and 78 Homesense stores, as well as, in Europe; and 74 T.K. Maxx stores in Australia.

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