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Off-price apparel retailer TJX clocks 7% hike in net sales

August 21, 2014 (United States Of America)

Apparels and home fashions off-price retailer, NYSE-listed The TJX Companies, Inc reported a 7% year-on-year hike in net sales to touch $6.9 billion in the second quarter ended August 2, 2014.

Consolidated comparable store sales increased 3% over last year's reported 4% increase in the quarter under review.

Net income for the second quarter of 2014 stood at $518 million and diluted earnings per share were $0.73. Excluding a debt extinguishment charge of $0.02 per share, adjusted diluted earnings per share were $0.75, a 14% increase over the prior year quarter.

For the second quarter of 2014, TJX's consolidated pretax profit margin stood at 12.0%. On an adjusted basis, excluding the approximately 0.3 percentage point debt extinguishment charge, consolidated pretax profit margin was 12.3%, a 0.3 percentage point increase over the prior year.

The gross profit margin for the second quarter of 2014 was 28.6%, down 0.2 percentage points versus a very strong increase in the prior year. TJX said the decline was primarily due to the negative impact of mark-to-market adjustments on its hedging instruments as well as the impact of e-commerce on merchandise margins.

Selling, general and administrative (SG&A) costs as a percent of sales were 16.2%, down 0.5 percentage points from the prior year largely due to a favorable adjustment to its insurance reserves based on improved claims experience, as well as other cost savings, it said.
Total inventories as of August 2, 2014 were $3.4 billion, compared with $3.2 billion at the end of the second quarter last year. TJX said it enters the third quarter in an excellent inventory position to take advantage of the plentiful buying opportunities it is seeing in the marketplace.

During the second quarter of 2014, TJX repurchased a total of $440 million of TJX stock, retiring 8.0 million shares. For the first half of fiscal 2015, TJX spent a total of $800 million in repurchases of TJX stock, retiring 14.0 million shares.

For the third quarter of fiscal 2014, the retailer expects diluted earnings per share to be in the range of $0.81 to $0.85 compared to $0.86 per share last year. Excluding the $0.11 per share tax benefit, TJX said this would represent an 8% to 13% increase over last year's adjusted $0.75 per share.

Carol Meyrowitz, CEO at The TJX Companies said, "I am very pleased with our second quarter performance. Consolidated comp store sales were up 3% over 4% growth last year, at the high end of our plan, and adjusted earnings per share of $0.75 were up 14% over last year's 18% increase, exceeding our expectations”.

“The third quarter is off to a solid start and we are excited about our opportunities for the second half of the year. We enter the third quarter in an excellent inventory position and see plentiful opportunities for great brands in the marketplace”, she informed.


Fibre2fashion News Desk - India
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