| ☒ | Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 | ||||
May 1, 2021
| ☐ | Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 | ||||
| Delaware | 04-2207613 | |||||||
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |||||||
| 770 Cochituate Road Framingham, Massachusetts | 01701 | |||||||
| (Address of principal executive offices) | (Zip Code) | |||||||
| Title of Each Class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
| Common Stock, par value $1.00 per share | TJX | New York Stock Exchange | ||||||
| Large accelerated filer | ☒ | Accelerated filer | ☐ | |||||||||||||||||
| ☐ | ||||||||||||||||||||
| Emerging growth company | ☐ | |||||||||||||||||||
May 21, 2021: 1,206,487,186
Statements
(LOSS)
| Thirteen Weeks Ended | ||||||||
| October 28, 2017 | October 29, 2016 | |||||||
Net sales | $ | 8,762,220 | $ | 8,291,688 | ||||
|
|
|
| |||||
Cost of sales, including buying and occupancy costs | 6,150,020 | 5,843,873 | ||||||
Selling, general and administrative expenses | 1,584,219 | 1,462,574 | ||||||
Loss on early extinguishment of debt | — | 51,773 | ||||||
Pension settlement charge | — | 31,173 | ||||||
Interest expense, net | 7,981 | 12,462 | ||||||
|
|
|
| |||||
Income before provision for income taxes | 1,020,000 | 889,833 | ||||||
Provision for income taxes | 378,564 | 340,047 | ||||||
|
|
|
| |||||
Net income | $ | 641,436 | $ | 549,786 | ||||
|
|
|
| |||||
Basic earnings per share: | ||||||||
Net income | $ | 1.01 | $ | 0.84 | ||||
Weighted average common shares – basic | 634,022 | 653,559 | ||||||
Diluted earnings per share: | ||||||||
Net income | $ | 1.00 | $ | 0.83 | ||||
Weighted average common shares – diluted | 642,881 | 661,721 | ||||||
Cash dividends declared per share | $ | 0.3125 | $ | 0.2600 | ||||
| Thirteen Weeks Ended | ||||||||||||||
| May 1, 2021 | May 2, 2020 | |||||||||||||
| Net sales | $ | 10,086,661 | $ | 4,408,888 | ||||||||||
| Cost of sales, including buying and occupancy costs | 7,255,635 | 4,414,465 | ||||||||||||
| Selling, general and administrative expenses | 2,064,992 | 1,313,920 | ||||||||||||
| Interest expense, net | 44,688 | 23,351 | ||||||||||||
| Income (loss) before income taxes | 721,346 | (1,342,848) | ||||||||||||
| (Provision) benefit for income taxes | (187,416) | 455,359 | ||||||||||||
| Net income (loss) | $ | 533,930 | $ | (887,489) | ||||||||||
| Basic earnings (loss) per share | $ | 0.44 | $ | (0.74) | ||||||||||
| Weighted average common shares – basic | 1,205,439 | 1,197,809 | ||||||||||||
| Diluted earnings (loss) per share | $ | 0.44 | $ | (0.74) | ||||||||||
| Weighted average common shares – diluted | 1,221,517 | 1,197,809 | ||||||||||||
2
(LOSS)
| Thirty-Nine Weeks Ended | ||||||||
| October 28, 2017 | October 29, 2016 | |||||||
Net sales | $ | 24,903,944 | $ | 23,716,097 | ||||
|
|
|
| |||||
Cost of sales, including buying and occupancy costs | 17,652,767 | 16,778,977 | ||||||
Selling, general and administrative expenses | 4,479,470 | 4,190,872 | ||||||
Loss on early extinguishment of debt | — | 51,773 | ||||||
Pension settlement charge | — | 31,173 | ||||||
Interest expense, net | 27,499 | 33,918 | ||||||
|
|
|
| |||||
Income before provision for income taxes | 2,744,208 | 2,629,384 | ||||||
Provision for income taxes | 1,013,536 | 1,009,078 | ||||||
|
|
|
| |||||
Net income | $ | 1,730,672 | $ | 1,620,306 | ||||
|
|
|
| |||||
Basic earnings per share: | ||||||||
Net income | $ | 2.71 | $ | 2.46 | ||||
Weighted average common shares – basic | 639,191 | 657,746 | ||||||
Diluted earnings per share: | ||||||||
Net income | $ | 2.67 | $ | 2.43 | ||||
Weighted average common shares – diluted | 648,672 | 666,632 | ||||||
Cash dividends declared per share | $ | 0.9375 | $ | 0.7800 | ||||
| Thirteen Weeks Ended | ||||||||
| May 1, 2021 | May 2, 2020 | |||||||
| Net income (loss) | $ | 533,930 | $ | (887,489) | ||||
| Additions to other comprehensive income (loss): | ||||||||
| Foreign currency translation adjustments, net of related tax provision of $2,898 in fiscal 2022 and tax benefit of $6,948 in fiscal 2021 | 22,249 | (129,158) | ||||||
| Reclassifications from other comprehensive income (loss) to net income (loss): | ||||||||
| Amortization of prior service cost and deferred gains/losses, net of related tax provisions of $1,056 in fiscal 2022 and $1,746 in fiscal 2021 | 2,901 | 4,797 | ||||||
| Amortization of loss on cash flow hedge, net of related tax provisions of $603 in fiscal 2022 and $76 in fiscal 2021 | (263) | 208 | ||||||
| Other comprehensive income (loss), net of tax | 24,887 | (124,153) | ||||||
| Total comprehensive income (loss) | $ | 558,817 | $ | (1,011,642) | ||||
3
BALANCE SHEETS
| Thirteen Weeks Ended | ||||||||
| October 28, 2017 | October 29, 2016 | |||||||
Net income | $ | 641,436 | $ | 549,786 | ||||
|
|
|
| |||||
Additions to other comprehensive income: | ||||||||
Foreign currency translation adjustments, net of related tax benefits of $18,110 in fiscal 2018 and $14,123 in fiscal 2017 | (46,029 | ) | (94,590 | ) | ||||
Recognition of net (losses) on benefit obligations, net of related tax benefit of $47,051 in fiscal year 2017 | — | (71,525 | ) | |||||
Reclassifications from other comprehensive income to net income: | ||||||||
Pension settlement charge, net of related tax provision of $12,369 in fiscal 2017 | — | 18,804 | ||||||
Amortization of prior service cost and deferred gains, net of related tax provisions of $2,414 in fiscal 2018 and $3,462 in fiscal 2017 | 3,669 | 5,263 | ||||||
Amortization of loss on cash flow hedge, net of related tax provisions of $112 in fiscal 2018 and $112 in fiscal 2017 | 171 | 171 | ||||||
|
|
|
| |||||
Other comprehensive (loss), net of tax | (42,189 | ) | (141,877 | ) | ||||
|
|
|
| |||||
Total comprehensive income | $ | 599,247 | $ | 407,909 | ||||
|
|
|
| |||||
| Thirty-Nine Weeks Ended | ||||||||
| October 28, 2017 | October 29, 2016 | |||||||
Net income | $ | 1,730,672 | $ | 1,620,306 | ||||
|
|
|
| |||||
Additions to other comprehensive income: | ||||||||
Foreign currency translation adjustments, net of related tax provision of $16,212 in fiscal 2018 and benefit of $17,241 in fiscal 2017 | 79,393 | (93,304 | ) | |||||
Recognition of net (losses) on benefit obligations, net of related tax benefit of $47,051 in fiscal year 2017 | — | (71,525 | ) | |||||
Reclassifications from other comprehensive income to net income: | ||||||||
Pension settlement charge, net of related tax provision of $12,369 in fiscal 2017 | — | 18,804 | ||||||
Amortization of prior service cost and deferred gains, net of related tax provisions of $7,500 in fiscal 2018 and $7,517 in fiscal 2017 | 11,401 | 11,427 | ||||||
Amortization of loss on cash flow hedge, net of related tax provisions of $337 in fiscal 2018 and $337 in fiscal 2017 | 513 | 513 | ||||||
|
|
|
| |||||
Other comprehensive income (loss), net of tax | 91,307 | (134,085 | ) | |||||
|
|
|
| |||||
Total comprehensive income | $ | 1,821,979 | $ | 1,486,221 | ||||
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|
| |||||
EXCEPT SHARE DATA
| May 1, 2021 | January 30, 2021 | May 2, 2020 | |||||||||
| ASSETS | |||||||||||
| Current assets: | |||||||||||
| Cash and cash equivalents | $ | 8,775,485 | $ | 10,469,570 | $ | 4,287,835 | |||||
| Accounts receivable, net | 621,177 | 461,139 | 172,463 | ||||||||
| Merchandise inventories | 5,114,643 | 4,337,389 | 4,945,720 | ||||||||
| Prepaid expenses and other current assets | 440,533 | 434,977 | 408,587 | ||||||||
| Federal, state and foreign income taxes recoverable | 64,211 | 36,262 | 481,643 | ||||||||
| Total current assets | 15,016,049 | 15,739,337 | 10,296,248 | ||||||||
| Net property at cost | 5,067,824 | 5,036,096 | 5,201,697 | ||||||||
| Non-current deferred income taxes, net | 135,765 | 127,191 | 36,742 | ||||||||
| Operating lease right of use assets | 9,121,628 | 8,989,998 | 9,073,898 | ||||||||
| Goodwill | 99,324 | 98,998 | 94,469 | ||||||||
| Other assets | 860,844 | 821,935 | 712,186 | ||||||||
| TOTAL ASSETS | $ | 30,301,434 | $ | 30,813,555 | $ | 25,415,240 | |||||
| LIABILITIES | |||||||||||
| Current liabilities: | |||||||||||
| Accounts payable | $ | 4,433,295 | $ | 4,823,397 | $ | 1,071,190 | |||||
| Accrued expenses and other current liabilities | 3,536,637 | 3,471,459 | 2,187,885 | ||||||||
| Current portion of operating lease liabilities | 1,650,574 | 1,677,605 | 1,399,290 | ||||||||
| Current portion of long-term debt | 0 | 749,684 | 0 | ||||||||
| Federal, state and foreign income taxes payable | 286,455 | 81,523 | 11,182 | ||||||||
| Total current liabilities | 9,906,961 | 10,803,668 | 4,669,547 | ||||||||
| Other long-term liabilities | 1,033,236 | 1,063,902 | 786,008 | ||||||||
| Non-current deferred income taxes, net | 33,930 | 37,164 | 113,229 | ||||||||
| Long-term operating lease liabilities | 7,853,229 | 7,743,216 | 7,914,825 | ||||||||
| Long-term debt | 5,334,864 | 5,332,921 | 7,192,413 | ||||||||
| Commitments and contingencies (See Note K) | 0 | 0 | 0 | ||||||||
| SHAREHOLDERS’ EQUITY | |||||||||||
| Preferred stock, authorized 5,000,000 shares, par value $1, 0 shares issued | 0 | 0 | 0 | ||||||||
| Common stock, authorized 1,800,000,000 shares, par value $1, issued and outstanding 1,206,386,746; 1,204,698,124 and 1,197,877,094 respectively | 1,206,387 | 1,204,698 | 1,197,877 | ||||||||
| Additional paid-in capital | 321,475 | 260,515 | 8,104 | ||||||||
| Accumulated other comprehensive loss | (581,184) | (606,071) | (797,324) | ||||||||
| Retained earnings | 5,192,536 | 4,973,542 | 4,330,561 | ||||||||
| Total shareholders’ equity | 6,139,214 | 5,832,684 | 4,739,218 | ||||||||
| TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $ | 30,301,434 | $ | 30,813,555 | $ | 25,415,240 | |||||
4
STATEMENTS OF CASH FLOWS
| October 28, 2017 | January 28, 2017 | October 29, 2016 | ||||||||||
ASSETS | ||||||||||||
Current assets: | ||||||||||||
Cash and cash equivalents | $ | 2,364,244 | $ | 2,929,849 | $ | 2,375,532 | ||||||
Short-term investments | 511,618 | 543,242 | 450,804 | |||||||||
Accounts receivable, net | 345,866 | 258,831 | 306,426 | |||||||||
Merchandise inventories | 4,725,850 | 3,644,959 | 4,384,171 | |||||||||
Prepaid expenses and other current assets | 422,719 | 358,058 | 409,986 | |||||||||
Federal, state, and foreign income taxes recoverable | 19,737 | 15,835 | 15,415 | |||||||||
|
|
|
|
|
| |||||||
Total current assets | 8,390,034 | 7,750,774 | 7,942,334 | |||||||||
|
|
|
|
|
| |||||||
Net property at cost | 4,858,284 | 4,532,894 | 4,318,829 | |||||||||
Non-current deferred income taxes, net | 6,655 | 6,193 | 3,624 | |||||||||
Goodwill | 196,365 | 195,871 | 196,011 | |||||||||
Other assets | 426,357 | 398,076 | 406,038 | |||||||||
|
|
|
|
|
| |||||||
TOTAL ASSETS | $ | 13,877,695 | $ | 12,883,808 | $ | 12,866,836 | ||||||
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|
|
|
|
| |||||||
LIABILITIES | ||||||||||||
Current liabilities: | ||||||||||||
Accounts payable | $ | 2,986,374 | $ | 2,230,904 | $ | 2,686,845 | ||||||
Accrued expenses and other current liabilities | 2,361,422 | 2,320,464 | 2,155,587 | |||||||||
Federal, state and foreign income taxes payable | 120,185 | 206,288 | 52,082 | |||||||||
|
|
|
|
|
| |||||||
Total current liabilities | 5,467,981 | 4,757,656 | 4,894,514 | |||||||||
|
|
|
|
|
| |||||||
Other long-term liabilities | 1,159,975 | 1,073,954 | 1,098,491 | |||||||||
Non-current deferred income taxes, net | 374,276 | 314,000 | 317,107 | |||||||||
Long-term debt | 2,229,855 | 2,227,599 | 2,226,913 | |||||||||
Commitments and contingencies (See Note K) | ||||||||||||
SHAREHOLDERS’ EQUITY | ||||||||||||
Preferred stock, authorized 5,000,000 shares, par value $1, no shares issued | — | — | — | |||||||||
Common stock, authorized 1,200,000,000 shares, par value $1, issued and outstanding 632,302,505; 646,319,046 and 651,900,739 respectively | 632,303 | 646,319 | 651,901 | |||||||||
Additionalpaid-in capital | — | — | — | |||||||||
Accumulated other comprehensive (loss) | (602,919 | ) | (694,226 | ) | (801,557 | ) | ||||||
Retained earnings | 4,616,224 | 4,558,506 | 4,479,467 | |||||||||
|
|
|
|
|
| |||||||
Total shareholders’ equity | 4,645,608 | 4,510,599 | 4,329,811 | |||||||||
|
|
|
|
|
| |||||||
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $ | 13,877,695 | $ | 12,883,808 | $ | 12,866,836 | ||||||
|
|
|
|
|
| |||||||
| Thirteen Weeks Ended | |||||||||||
| May 1, 2021 | May 2, 2020 | ||||||||||
| Cash flows from operating activities: | |||||||||||
| Net income (loss) | $ | 533,930 | $ | (887,489) | |||||||
| Adjustments to reconcile net income (loss) to cash used in operating activities: | |||||||||||
| Depreciation and amortization | 215,379 | 219,460 | |||||||||
| Loss on property disposals and impairment charges | 931 | 26,424 | |||||||||
| Deferred income tax (benefit) | (16,181) | (48,464) | |||||||||
| Share-based compensation | 50,536 | (11,531) | |||||||||
| Changes in assets and liabilities: | |||||||||||
| (Increase) decrease in accounts receivable | (156,999) | 210,419 | |||||||||
| (Increase) in merchandise inventories | (750,553) | (136,027) | |||||||||
| (Increase) in income taxes recoverable | (27,949) | (434,674) | |||||||||
| Decrease (increase) in prepaid expenses and other current assets | 12,254 | (39,580) | |||||||||
| (Decrease) in accounts payable | (410,244) | (1,567,597) | |||||||||
| Increase (decrease) in accrued expenses and other liabilities | 12,214 | (578,178) | |||||||||
| Increase (decrease) in income taxes payable | 203,740 | (13,290) | |||||||||
| (Decrease) increase in net operating lease liabilities | (50,319) | 65,578 | |||||||||
| Other, net | (49,466) | 34,466 | |||||||||
| Net cash (used in) operating activities | (432,727) | (3,160,483) | |||||||||
| Cash flows from investing activities: | |||||||||||
| Property additions | (225,293) | (210,525) | |||||||||
| Purchase of investments | (7,345) | (14,792) | |||||||||
| Sales and maturities of investments | 7,733 | 4,214 | |||||||||
| Net cash (used in) investing activities | (224,905) | (221,103) | |||||||||
| Cash flows from financing activities: | |||||||||||
| Payments on debt | (750,000) | 0 | |||||||||
| Proceeds from long-term debt including revolving credit facilities | 0 | 4,988,452 | |||||||||
| Payments for debt issuance expenses | 0 | (33,872) | |||||||||
| Payments for repurchase of common stock | 0 | (201,500) | |||||||||
| Cash dividends paid | (315,215) | (278,250) | |||||||||
| Proceeds from issuance of common stock | 36,539 | 37,444 | |||||||||
| Payments of employee tax withholdings for performance based stock awards | (24,426) | (21,765) | |||||||||
| Net cash (used in) provided by financing activities | (1,053,102) | 4,490,509 | |||||||||
| Effect of exchange rate changes on cash | 16,649 | (37,840) | |||||||||
| Net (decrease) increase in cash and cash equivalents | (1,694,085) | 1,071,083 | |||||||||
| Cash and cash equivalents at beginning of year | 10,469,570 | 3,216,752 | |||||||||
| Cash and cash equivalents at end of period | $ | 8,775,485 | $ | 4,287,835 | |||||||
5
SHAREHOLDERS’ EQUITY
| Thirty-Nine Weeks Ended | ||||||||
| October 28, 2017 | October 29, 2016 | |||||||
Cash flows from operating activities: | ||||||||
Net income | $ | 1,730,672 | $ | 1,620,306 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
Depreciation and amortization | 532,424 | 492,395 | ||||||
Loss on property disposals and impairment charges | 2,209 | 1,648 | ||||||
Deferred income tax provision | 35,802 | 52,629 | ||||||
Share-based compensation | 77,152 | 77,380 | ||||||
Excess tax benefits from share-based compensation | — | (60,332 | ) | |||||
Loss on early extinguishment of debt | — | 51,773 | ||||||
Pension settlement charge | — | 31,173 | ||||||
Changes in assets and liabilities: | ||||||||
(Increase) in accounts receivable | (84,403 | ) | (72,487 | ) | ||||
(Increase) in merchandise inventories | (1,042,664 | ) | (758,601 | ) | ||||
(Increase) in taxes recoverable | (3,902 | ) | (4,356 | ) | ||||
(Increase) in prepaid expenses and other current assets | (50,357 | ) | (38,174 | ) | ||||
Increase in accounts payable | 733,340 | 524,981 | ||||||
Increase in accrued expenses and other liabilities | 83,082 | 232,910 | ||||||
(Decrease) in income taxes payable | (86,842 | ) | (19,000 | ) | ||||
Other | 2,910 | (19,986 | ) | |||||
|
|
|
| |||||
Net cash provided by operating activities | 1,929,423 | 2,112,259 | ||||||
|
|
|
| |||||
Cash flows from investing activities: | ||||||||
Property additions | (827,529 | ) | (767,197 | ) | ||||
Purchase of investments | (630,079 | ) | (533,807 | ) | ||||
Sales and maturities of investments | 658,225 | 432,046 | ||||||
Other | — | (2,324 | ) | |||||
|
|
|
| |||||
Net cash (used in) investing activities | (799,383 | ) | (871,282 | ) | ||||
|
|
|
| |||||
Cash flows from financing activities: | ||||||||
Proceeds from issuance of long-term debt | 992,540 | |||||||
Cash payments for extinguishment of debt | — | (425,584 | ) | |||||
Cash payments for repurchase of common stock | (1,238,982 | ) | (1,175,000 | ) | ||||
Cash payments for debt issuance expenses | (9,921 | ) | ||||||
Cash payment for rate lock agreement | — | (3,150 | ) | |||||
Proceeds from issuance of common stock | 89,198 | 110,902 | ||||||
Excess tax benefits from share-based compensation | — | 60,332 | ||||||
Cash dividends paid | (566,949 | ) | (481,859 | ) | ||||
Cash payments of employee tax withholdings for performance based stock awards | (16,823 | ) | (24,965 | ) | ||||
Other | (2,312 | ) | — | |||||
|
|
|
| |||||
Net cash (used in) financing activities | (1,735,868 | ) | (956,705 | ) | ||||
|
| �� |
| |||||
Effect of exchange rate changes on cash | 40,223 | (4,213 | ) | |||||
|
|
|
| |||||
Net (decrease) increase in cash and cash equivalents | (565,605 | ) | 280,059 | |||||
Cash and cash equivalents at beginning of year | 2,929,849 | 2,095,473 | ||||||
|
|
|
| |||||
Cash and cash equivalents at end of period | $ | 2,364,244 | $ | 2,375,532 | ||||
|
|
|
| |||||
| Thirteen Weeks Ended | ||||||||||||||||||||
| Common Stock | ||||||||||||||||||||
| Shares | Par Value $1 | Additional Paid-In Capital | Accumulated Other Comprehensive Loss | Retained Earnings | Total | |||||||||||||||
| Balance, January 30, 2021 | 1,204,698 | $ | 1,204,698 | $ | 260,515 | $ | (606,071) | $ | 4,973,542 | $ | 5,832,684 | |||||||||
| Net income | — | — | — | — | 533,930 | 533,930 | ||||||||||||||
| Other comprehensive income, net of tax | — | — | — | 24,887 | — | 24,887 | ||||||||||||||
| Cash dividends declared on common stock | — | — | — | — | (314,936) | (314,936) | ||||||||||||||
| Recognition of share-based compensation | — | — | 50,536 | — | — | 50,536 | ||||||||||||||
| Issuance of common stock under Stock Incentive Plan, net of shares used to pay tax withholdings | 1,689 | 1,689 | 10,424 | — | — | 12,113 | ||||||||||||||
| Balance, May 1, 2021 | 1,206,387 | $ | 1,206,387 | $ | 321,475 | $ | (581,184) | $ | 5,192,536 | $ | 6,139,214 | |||||||||
| Thirteen Weeks Ended | ||||||||||||||||||||
| Common Stock | ||||||||||||||||||||
| Shares | Par Value $1 | Additional Paid-In Capital | Accumulated Other Comprehensive Loss | Retained Earnings | Total | |||||||||||||||
| Balance, February 1, 2020 | 1,199,100 | $ | 1,199,100 | $ | 0 | $ | (673,171) | $ | 5,422,283 | $ | 5,948,212 | |||||||||
| Net (loss) | — | — | — | — | (887,489) | (887,489) | ||||||||||||||
| Other comprehensive (loss), net of tax | — | — | — | (124,153) | — | (124,153) | ||||||||||||||
| Recognition (reversal) of share-based compensation | — | — | 20,304 | — | (31,835) | (11,531) | ||||||||||||||
| Issuance of common stock under Stock Incentive Plan, net of shares used to pay tax withholdings | 2,164 | 2,164 | 13,515 | — | — | 15,679 | ||||||||||||||
| Common stock repurchased and retired | (3,387) | (3,387) | (25,715) | — | (172,398) | (201,500) | ||||||||||||||
| Balance, May 2, 2020 | 1,197,877 | $ | 1,197,877 | $ | 8,104 | $ | (797,324) | $ | 4,330,561 | $ | 4,739,218 | |||||||||
6
CONSOLIDATED STATEMENT OF SHAREHOLDERS’ EQUITY
(UNAUDITED)
IN THOUSANDS
| Accumulated | ||||||||||||||||||||||||
| Common Stock | Additional Paid-In Capital | Other Comprehensive Income (Loss) | Retained Earnings | Total | ||||||||||||||||||||
| Shares | Par Value $1 | |||||||||||||||||||||||
Balance, January 28, 2017 | 646,319 | $ | 646,319 | $ | — | $ | (694,226 | ) | $ | 4,558,506 | $ | 4,510,599 | ||||||||||||
Net income | — | — | — | — | 1,730,672 | 1,730,672 | ||||||||||||||||||
Other comprehensive income (loss), net of tax | — | — | — | 91,307 | — | 91,307 | ||||||||||||||||||
Cash dividends declared on common stock | — | — | — | — | (597,595 | ) | (597,595 | ) | ||||||||||||||||
Recognition of share-based compensation | — | — | 77,152 | — | — | 77,152 | ||||||||||||||||||
Issuance of common stock under Stock Incentive Plan, net of shares used to pay tax withholdings | 2,726 | 2,726 | 69,729 | — | — | 72,455 | ||||||||||||||||||
Common stock repurchased and retired | (16,742 | ) | (16,742 | ) | (146,881 | ) | — | (1,075,359 | ) | (1,238,982 | ) | |||||||||||||
|
|
|
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| |||||||||||||
Balance, October 28, 2017 | 632,303 | $ | 632,303 | $ | — | $ | (602,919 | ) | $ | 4,616,224 | $ | 4,645,608 | ||||||||||||
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The accompanying notes are an integral part of the unaudited consolidated financial statements.
7
THE TJX COMPANIES, INC.
and Summary of Significant Accounting Policies
| In thousands | May 1, 2021 | May 2, 2020 | ||||||
| Balance, beginning of year | $ | 576,187 | $ | 500,844 | ||||
| Deferred revenue | 323,773 | 158,948 | ||||||
| Effect of exchange rates changes on deferred revenue | 2,899 | (4,680) | ||||||
| Revenue recognized | (365,854) | (180,062) | ||||||
| Balance, end of period | $ | 537,005 | $ | 475,050 | ||||
| Thirteen Weeks Ended | ||||||||
| In thousands | May 1, 2021 | May 2, 2020 | ||||||
| Operating cash flows paid for operating leases | $ | 531,836 | $ | 445,901 | ||||
| Lease liabilities arising from obtaining right of use assets | $ | 488,666 | $ | 553,075 | ||||
Revenue Recognition
In May 2014,
8
impact on our financial condition or results of operations other than additional disclosure requirements. We plan to adopt this standard in the first quarter of the fiscal year ending February 2, 2019 under the modified retrospective approach, which will result in a cumulative adjustment to retained earnings. We continue to evaluate the impact this standard will have on our Consolidated Financial Statements and Notes thereto.
Leases
In February 2016, the FASB issued updated guidance on leases that aims to increase transparency and comparability among organizations by requiring lessees to recognize lease assets and lease liabilities on the balance sheet and requiring disclosure of key information about leasing arrangements. The new standard is effective for annual periods beginning after December 15, 2018, and interim periods within those annual periods; early adoption is permitted and modified retrospective application is required. The Company has established a cross-functional team to implement the updated lease guidance and is in the process of evaluating its lease portfolio and the impact this standard will have on our Consolidated Financial Statements and Notes thereto. The Company expects this standard to have a material impact on its statement of financial condition as it will record a significant asset and liability associated with its more than 4,000 leased locations. The Company continues to assess if the initial lease term will differ under the new standard versus current accounting practice. If the lease term remains unchanged, the income statement impact of the new standard isare not expected to be material. We planmaterial to adopt this standard in the first quarter of the fiscal year ending February 1, 2020.
Cash Flows
In August 2016, a pronouncement was issued that addresses diversity in how certain cash receipts and cash payments are presented in the statement of cash flows. The new guidance provides clarity around the cash flow classification for eight specific issues in an effort to reduce the current and potential future diversity in practice. The standard, which is to be applied retrospectively, will be effective for the first interim period within annual reporting periods beginning after December 15, 2017, and earlyits Consolidated Financial Statements upon adoption is permitted. TJX does not expect this standard to have a material impact on our consolidated financial statements.
Goodwill
In January 2017, the FASB issued updated guidance on goodwill that aims to simplify the subsequent measurement of goodwill by eliminating Step 2 from the goodwill impairment test. Under the new guidance, goodwill impairment will be measured as the amount by which the carrying value exceeds the fair value. The loss recognized should not exceed the total amount of goodwill allocated to the reporting unit. The new guidance will be effective for annual reporting periods beginning after December 15, 2019, including interim periods. Early adoption is permitted for annual or interim goodwill impairment tests performed on testing dates after January 1, 2017. TJX does not expect the adoption of this standard to have a material impact on our consolidated financial statements.
Retirement Benefits
In March 2017, the FASB issued updated guidance related to retirement benefits, which requires that an employer report the service cost component of net periodic pension and net periodic post retirement cost in the same line item as other compensation costs arising from services rendered by the employees during the period. It also requires the other components of net periodic pension and net periodic postretirement benefit cost to be presented in the income statement separately from the service cost component and outside a subtotal of income from operations. Additionally, only the service cost component is eligible for capitalization. This pronouncement is effective for annual periods beginning after December 15, 2017, and interim periods within those fiscal years. Early adoption is permitted as of the beginning of an annual period for which financial statements have not been issued or made available for issuance. The amendments in this update should be applied retrospectively for the presentation of the service cost component and the other components of net periodic pension cost and net periodic postretirement benefit cost in the income statement and prospectively, on and after the effective date, for the capitalization of the service cost component of net periodic pension cost and net periodic postretirement benefit in assets. We are currently evaluating the presentation of the other components of net benefit cost. The Company has not yet determined the timing for adoption or estimated the effect on the Company’s financial statements.
9
Hedging Activities
In August 2017, the FASB issued updated guidance on hedge accounting. The updates allow hedge accounting for new types of interest rate hedges of financial instruments and simplify documentation requirements to qualify for hedge accounting. In addition, any gain or loss from hedge ineffectiveness will be reported in the same income statement line with the effective hedge results and the hedged transaction. The updated guidance is effective for annual reporting periods beginning after December 15, 2018, and early adoption is permitted. The Company has not yet determined the timing for adoption or estimated the effect on the Company’s financial statements.
Recently Adopted Accounting Standards
Share Based Compensation
In the first quarter of 2017, TJX adopted a pronouncement that aims to simplify several aspects of accounting and reporting for share-based payment transactions. One provision within this pronouncement requires that excess income tax benefits and tax deficiencies related to share-based payments be recognized within income tax expense in the statement of income, rather than within additionalpaid-in capital on the balance sheet. The adoption of this provision is to be applied prospectively. The impact to TJX’s results of operations related to this provision for the three and nine months ended October 28, 2017 was a decrease in the provision for income taxes of $12.6 million and $40.5 million, respectively. The impact of this benefit on TJX’s future results of operations will depend in part on the market prices for TJX’s shares on the dates there are taxable events related to share awards, and therefore the impact is difficult to predict. The remaining provisions within the pronouncement didare not have a material impact on our consolidated financial statements.
disclosed.
In thousands | October 28, 2017 | January 28, 2017 | October 29, 2016 | |||||||||
Land and buildings | $ | 1,294,992 | $ | 1,247,585 | $ | 1,118,739 | ||||||
Leasehold costs and improvements | 3,145,922 | 2,884,054 | 2,811,515 | |||||||||
Furniture, fixtures and equipment | 5,172,488 | 4,871,764 | 4,725,863 | |||||||||
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| |||||||
Total property at cost | $ | 9,613,402 | $ | 9,003,403 | $ | 8,656,117 | ||||||
Less accumulated depreciation and amortization | 4,755,118 | 4,470,509 | 4,337,288 | |||||||||
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Net property at cost | $ | 4,858,284 | $ | 4,532,894 | $ | 4,318,829 | ||||||
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| In thousands | May 1, 2021 | January 30, 2021 | May 2, 2020 | ||||||||
| Land and buildings | $ | 1,723,049 | $ | 1,668,381 | $ | 1,551,968 | |||||
| Leasehold costs and improvements | 3,611,943 | 3,568,829 | 3,437,975 | ||||||||
| Furniture, fixtures and equipment | 6,602,759 | 6,525,615 | 6,343,510 | ||||||||
| Total property at cost | $ | 11,937,751 | $ | 11,762,825 | $ | 11,333,453 | |||||
| Less: accumulated depreciation and amortization | 6,869,927 | 6,726,729 | 6,131,756 | ||||||||
| Net property at cost | $ | 5,067,824 | $ | 5,036,096 | $ | 5,201,697 | |||||
As previously disclosed, during fiscal 2017, the Company identified fully depreciated assets that were no longer in use and should have been written off during fiscal 2017 or prior periods. The October 29, 2016 property at cost and accumulated depreciation were each reduced by $869 million, and, therefore there was no impact to net property at cost. This error was not material to our consolidated financial statements; however, we have revised the October 29, 2016 amounts to reflect thewrite-off that should have been recorded at that time.
10
May 2, 2020.
In thousands | Foreign Currency Translation | Deferred Benefit Costs | Cash Flow Hedge on Debt | Accumulated Other Comprehensive Income (Loss) | ||||||||||||
Balance, January 28, 2017 | $ | (491,803 | ) | $ | (199,481 | ) | $ | (2,942 | ) | $ | (694,226 | ) | ||||
Additions to other comprehensive income: | ||||||||||||||||
Foreign currency translation adjustments (net of taxes of $16,212) | 79,393 | — | — | 79,393 | ||||||||||||
Reclassifications from other comprehensive income to net income: | ||||||||||||||||
Amortization of prior service cost and deferred gains (net of taxes of $7,500) | — | 11,401 | — | 11,401 | ||||||||||||
Amortization of loss on cash flow hedge (net of taxes of $337) | — | — | 513 | 513 | ||||||||||||
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| |||||||||
Balance, October 28, 2017 | $ | (412,410 | ) | $ | (188,080 | ) | $ | (2,429 | ) | $ | (602,919 | ) | ||||
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January 30, 2021 and the three months ended May 1, 2021:
| In thousands | Foreign Currency Translation | Deferred Benefit Costs | Cash Flow Hedge on Debt | Accumulated Other Comprehensive (Loss) Income | ||||||||||
| Balance, February 1, 2020 | $ | (457,120) | $ | (215,483) | $ | (568) | $ | (673,171) | ||||||
| Additions to other comprehensive loss: | ||||||||||||||
| Foreign currency translation adjustments (net of taxes of $2,442) | 15,588 | — | — | 15,588 | ||||||||||
| Recognition of net gains/losses on benefit obligations (net of taxes of $9,974) | — | 30,635 | — | 30,635 | ||||||||||
| Reclassifications from other comprehensive loss to net income: | ||||||||||||||
| Amortization of loss on cash flow hedge (net of taxes of $303) | — | — | 831 | 831 | ||||||||||
| Amortization of prior service cost and deferred gains/losses (net of taxes of $7,298) | — | 20,046 | — | 20,046 | ||||||||||
| Balance, January 30, 2021 | $ | (441,532) | $ | (164,802) | $ | 263 | $ | (606,071) | ||||||
| Additions to other comprehensive loss: | ||||||||||||||
| Foreign currency translation adjustments (net of taxes of $2,898) | 22,249 | — | — | 22,249 | ||||||||||
| Reclassifications from other comprehensive loss to net income: | ||||||||||||||
| Amortization of loss on cash flow hedge (net of taxes of $603) | — | — | (263) | (263) | ||||||||||
| Amortization of prior service cost and deferred gains/losses (net of taxes of $1,056) | — | 2,901 | — | 2,901 | ||||||||||
| Balance, May 1, 2021 | $ | (419,283) | $ | (161,901) | $ | 0 | $ | (581,184) | ||||||
May 2, 2020. These expenditures were funded by cash generated from operations.
In February 2017,2019, TJX announced that its Board of Directors had approved an additional stock repurchase program that authorized the repurchase of up to $1.0$1.5 billion of TJX common stock from time to time, alltime.
under these previously announced stock repurchase programs.
11
In thousands, except per share data Basic earnings per share Net income Weighted average common shares outstanding for basic EPS Basic earnings per share Diluted earnings per share Net income Shares for basic and diluted earnings per share calculations: Weighted average common shares outstanding for basic EPS Assumed exercise/vesting of: Stock options and awards Weighted average common shares outstanding for diluted EPS Diluted earnings per share In thousands, except per share data Basic earnings per share Net income Weighted average common shares outstanding for basic EPS Basic earnings per share Diluted earnings per share Net income Shares for basic and diluted earnings per share calculations: Weighted average common shares outstanding for basic EPS Assumed exercise/vesting of: Stock options and awards Weighted average common shares outstanding for diluted EPS Diluted earnings per share income (loss): therefore have been excluded from the calculation.tables presenttable presents the calculation of basic and diluted earnings (loss) per share (“EPS”) for net income: Thirteen Weeks Ended October 28,
2017 October 29,
2016 $ 641,436 $ 549,786 634,022 653,559 $ 1.01 $ 0.84 $ 641,436 $ 549,786 634,022 653,559 8,859 8,162 642,881 661,721 $ 1.00 $ 0.83 Thirty-Nine Weeks Ended October 28,
2017 October 29,
2016 $ 1,730,672 $ 1,620,306 639,191 657,746 $ 2.71 $ 2.46 $ 1,730,672 $ 1,620,306 639,191 657,746 9,481 8,886 648,672 666,632 $ 2.67 $ 2.43 Thirteen Weeks Ended Amounts in thousands, expect per share amounts May 1,
2021May 2,
2020Basic earnings (loss) per share: Net income (loss) $ 533,930 $ (887,489) Weighted average common shares outstanding for basic earnings (loss) per share calculation 1,205,439 1,197,809 Basic earnings (loss) per share $ 0.44 $ (0.74) Diluted earnings (loss) per share: Net income (loss) $ 533,930 $ (887,489) Weighted average common shares outstanding for basic earnings (loss) per share calculations 1,205,439 1,197,809 Assumed exercise / vesting of stock options and awards 16,078 0 Weighted average common shares outstanding for diluted earnings (loss) per share calculation 1,221,517 1,197,809 Diluted earnings (loss) per share $ 0.44 $ (0.74) Cash dividends declared per share $ 0.26 $ 0 excludeexcludes the impact of outstanding stock options if the assumed proceeds per share of the option is in excess of the related fiscal period’s average price of TJX’s common stock.stock for the related fiscal period. Such options are excluded because they would have an antidilutive effect. There were 12.6 million0 such options excluded for each of the thirteen weeks and thirty-nine weeks ended October 28, 2017. There were 4.3 million such options excluded for eachMay 1, 2021. For the period ended May 2, 2020, as a result of the thirteen weeksnet loss for the quarter, all options were antidilutive and thirty-nine weeks ended October 29, 2016.12statements of financial positionConsolidated Balance Sheets and measures those instruments at fair value. The fair values of the derivatives are classified as assets or liabilities, current ornon-current, based upon valuation results and settlement dates of the individual contracts. Changes to the fair value of derivative contracts that do not qualify for hedge accounting are reported in earnings in the period of the change. For derivatives that qualify for hedge accounting, changes in the fair value of the derivatives are either recorded in shareholders’ equity as a component of other comprehensive (loss) income or are recognized currently in earnings, along with an offsetting adjustment against the basis of the item being hedged. TJX does not hedge its net investments in foreign subsidiaries.2017,2021, TJX entered into agreements to hedge a portion of its estimated notional diesel requirements for fiscal 2018. During2022, and during the first ninethree months of fiscal 2018,2022, TJX entered into agreements to hedge a portion of its estimated notional diesel requirements for the first ninethree months of fiscal 2019.2023. The hedge agreements outstanding at October 28, 2017May 1, 2021 relate to approximately 51%48% of TJX’s estimated notional diesel requirements for the remainder of fiscal 20182022 and approximately 34%40% of TJX’s estimated notional diesel requirements for the first ninethree months of fiscal 2019.2023. These diesel fuel hedge agreements will settle throughout the remainder of fiscal 20182022 and throughout the first tenfour months of fiscal 2019.TJX2023. TJX elected not to apply hedge accounting rules to these contracts.at TJX International (United Kingdom, Ireland, Germany, Poland, Austria, The Netherlands and Australia), TJX Canada (Canada), Marmaxx (U.S.) and HomeGoods (U.S.) in currencies other than their respective functional currencies. TheseAs a result of the COVID-19 pandemic, there was a significant change in the Company's anticipated merchandise purchases during the first quarter of fiscal 2021 and the Company early settled derivative contracts typically havedesigned to hedge merchandise purchases that would no longer take place. The settlement of these contracts resulted in a termnet gain of twelve months or less.$25 million in the first quarter of fiscal 2021. The contracts outstanding at October 28, 2017May 1, 2021 cover a portion of such actual and anticipatedthe merchandise purchases throughout the remainder of fiscal 2018 and throughoutCompany is committed to over the second quarter of fiscal 2019.next several months. Additionally, TJX’s operations in Europe are subject to foreign currency exposure as a result of their buying function being centralized in the United Kingdom.U.K. All merchandise is purchased centrally in the U.K. and then shipped and billed to the retail entities in other countries. This intercompany billing to TJX’s European businesses’ Euro denominated operations creates exposure to the central buying entity for changes in the exchange rate between the Euro and British Pound. The inflow of Euros to the central buying entity provides a natural hedge for merchandise purchased from third-party vendors that is denominated in Euros. However, with the growth of TJX’s Euro denominated retail operations, the intercompany billings committed to the Euro denominated operations is generating Euros in excess of those needed to meet merchandise commitments to outside vendors. TJX calculates thisany excess Euro exposure each month and enters into forward contracts of approximately 30 daysdays' duration to mitigate thethis exposure. TJX elected not to apply hedge accounting rules to these contracts.13
In thousands | Pay | Receive | Blended Contract Rate | Balance Sheet | Current Asset U.S.$ | Current (Liability) U.S.$ | Net Fair Value in U.S.$ at October 28, 2017 | |||||||||||||||||||||
Fair value hedges: | ||||||||||||||||||||||||||||
Intercompany balances, primarily debt and related interest |
| |||||||||||||||||||||||||||
| zł | 67,000 | £ | 13,000 | 0.1940 | (Accrued Exp) | $ | — | $ | (1,211 | ) | $ | (1,211 | ) | |||||||||||||||
| € | 49,950 | £ | 43,317 | 0.8672 | Prepaid Exp / (Accrued Exp) | 277 | (1,600 | ) | (1,323 | ) | ||||||||||||||||||
| U.S.$ | 68,445 | £ | 55,000 | 0.8036 | Prepaid Exp | 3,849 | — | 3,849 | ||||||||||||||||||||
Economic hedges for which hedge accounting was not elected: |
| |||||||||||||||||||||||||||
Diesel contracts | | Fixed on 250k – 2.5M gal per month | | | Float on 250k – 2.5M gal per month | | N/A | Prepaid Exp | 5,226 | — | 5,226 | |||||||||||||||||
Intercompany billings in Europe, primarily merchandise related | € | 27,000 | £ | 24,062 | 0.8912 | Prepaid Exp | 202 | — | 202 | |||||||||||||||||||
Merchandise purchase commitments |
| |||||||||||||||||||||||||||
| C$ | 511,004 | U.S.$ | 399,650 | 0.7821 | Prepaid Exp / (Accrued Exp) | 5,023 | (4,770 | ) | 253 | |||||||||||||||||||
| C$ | 25,305 | € | 17,000 | 0.6718 | Prepaid Exp / (Accrued Exp) | 63 | (62 | ) | 1 | |||||||||||||||||||
| £ | 163,682 | U.S.$ | 214,000 | 1.3074 | Prepaid Exp / (Accrued Exp) | 678 | (2,298 | ) | (1,620 | ) | ||||||||||||||||||
| A$ | 27,187 | U.S.$ | 21,351 | 0.7853 | Prepaid Exp | 467 | — | 467 | ||||||||||||||||||||
| zł | 313,150 | £ | 65,249 | 0.2084 | Prepaid Exp / (Accrued Exp) | 580 | (350 | ) | 230 | |||||||||||||||||||
| U.S.$ | 2,928 | £ | 2,245 | 0.7667 | Prepaid Exp | 16 | — | 16 | ||||||||||||||||||||
| U.S.$ | 68,723 | € | 58,859 | 0.8565 | Prepaid Exp / (Accrued Exp) | 729 | (989 | ) | (260 | ) | ||||||||||||||||||
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Total fair value of derivative financial instruments |
| $ | 17,110 | $ | (11,280 | ) | $ | 5,830 | ||||||||||||||||||||
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14
May 1, 2021:
| In thousands | Pay | Receive | Blended Contract Rate | Balance Sheet Location | Current Asset U.S.$ | Current (Liability) U.S.$ | Net Fair Value in U.S.$ at May 1, 2021 | ||||||||||||||||||||||
| Fair value hedges: | |||||||||||||||||||||||||||||
| Intercompany balances, primarily debt and related interest: | |||||||||||||||||||||||||||||
| zł | 45,000 | £ | 8,846 | 0.1966 | Prepaid Exp | $ | 353 | $ | 0 | $ | 353 | ||||||||||||||||||
| A$ | 80,000 | U.S.$ | 62,032 | 0.7754 | (Accrued Exp) | 0 | (98) | (98) | |||||||||||||||||||||
| U.S.$ | 75,102 | £ | 55,000 | 0.7323 | Prepaid Exp | 1,505 | 0 | 1,505 | |||||||||||||||||||||
| £ | 450,000 | U.S.$ | 620,918 | 1.3798 | Prepaid Exp / (Accrued Exp) | 40 | (5,582) | (5,542) | |||||||||||||||||||||
| € | 200,000 | U.S.$ | 244,699 | 1.2235 | Prepaid Exp | 2,301 | 0 | 2,301 | |||||||||||||||||||||
| Economic hedges for which hedge accounting was not elected: | |||||||||||||||||||||||||||||
| Diesel fuel contracts | Fixed on 3.1M – 3.8M gal per month | Float on 3.1M – 3.8M gal per month | N/A | Prepaid Exp | 17,816 | 0 | 17,816 | ||||||||||||||||||||||
| Intercompany billings in TJX International, primarily merchandise related: | |||||||||||||||||||||||||||||
| € | 163,000 | £ | 141,240 | 0.8665 | (Accrued Exp) | 0 | (166) | (166) | |||||||||||||||||||||
| Merchandise purchase commitments: | |||||||||||||||||||||||||||||
| C$ | 574,390 | U.S.$ | 457,000 | 0.7956 | (Accrued Exp) | 0 | (11,054) | (11,054) | |||||||||||||||||||||
| C$ | 29,455 | € | 19,500 | 0.6620 | (Accrued Exp) | 0 | (444) | (444) | |||||||||||||||||||||
| £ | 282,746 | U.S.$ | 391,800 | 1.3857 | Prepaid Exp / (Accrued Exp) | 1,939 | (3,751) | (1,812) | |||||||||||||||||||||
| A$ | 50,830 | U.S.$ | 39,125 | 0.7697 | Prepaid Exp / (Accrued Exp) | 42 | (356) | (314) | |||||||||||||||||||||
| U.S.$ | 53,680 | € | 44,400 | 0.8271 | Prepaid Exp / (Accrued Exp) | 185 | (267) | (82) | |||||||||||||||||||||
| Total fair value of derivative financial instruments | $ | 24,181 | $ | (21,718) | $ | 2,463 | |||||||||||||||||||||||
In thousands | Pay | Receive | Blended Contract Rate | Balance Sheet | Current Asset U.S.$ | Current (Liability) U.S.$ | Net Fair Value in U.S.$ at January 28, 2017 | |||||||||||||||||||||
Fair value hedges: | ||||||||||||||||||||||||||||
Intercompany balances, primarily debt and related interest |
| |||||||||||||||||||||||||||
| zł | 67,000 | £ | 13,000 | 0.1940 | (Accrued Exp) | $ | — | $ | (6 | ) | $ | (6 | ) | |||||||||||||||
| € | 63,000 | £ | 54,452 | 0.8643 | Prepaid Exp | 263 | — | 263 | ||||||||||||||||||||
| U.S.$ | 68,445 | £ | 55,000 | 0.8036 | Prepaid Exp | 1,196 | — | 1,196 | ||||||||||||||||||||
Economic hedges for which hedge accounting was not elected: |
| |||||||||||||||||||||||||||
Diesel contracts | | Fixed on 2.1M – 2.5M gal per month | | | Float on 2.1M– 2.5M gal per month | | N/A | Prepaid Exp | 2,183 | — | 2,183 | |||||||||||||||||
Intercompany billings in Europe, primarily merchandise related |
| |||||||||||||||||||||||||||
| € | 68,000 | £ | 58,306 | 0.8574 | Prepaid Exp | 262 | — | 262 | ||||||||||||||||||||
Merchandise purchase commitments | ||||||||||||||||||||||||||||
| C$ | 462,025 | U.S.$ | 349,750 | 0.7570 | Prepaid Exp / (Accrued Exp) | 1,089 | (3,081 | ) | (1,992 | ) | ||||||||||||||||||
| C$ | 19,571 | € | 13,650 | 0.6975 | Prepaid Exp / (Accrued Exp) | 22 | (290 | ) | (268 | ) | ||||||||||||||||||
| £ | 180,963 | U.S.$ | 227,500 | 1.2572 | Prepaid Exp / (Accrued Exp) | 2,327 | (2,695 | ) | (368 | ) | ||||||||||||||||||
| zł | 249,079 | £ | 48,593 | 0.1951 | Prepaid Exp / (Accrued Exp) | 681 | (927 | ) | (246 | ) | ||||||||||||||||||
| U.S.$ | 22,226 | € | 20,686 | 0.9307 | Prepaid Exp / (Accrued Exp) | 178 | (257 | ) | (79 | ) | ||||||||||||||||||
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Total fair value of financial instruments |
| $ | 8,201 | $ | (7,256 | ) | $ | 945 | ||||||||||||||||||||
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15
30, 2021:
| In thousands | Pay | Receive | Blended Contract Rate | Balance Sheet Location | Current Asset U.S.$ | Current (Liability) U.S.$ | Net Fair Value in U.S.$ at January 30, 2021 | ||||||||||||||||||||||
| Fair value hedges: | |||||||||||||||||||||||||||||
| Intercompany balances, primarily debt and related interest: | |||||||||||||||||||||||||||||
| zł | 45,000 | £ | 8,846 | 0.1966 | Prepaid Exp | $ | 11 | $ | 0 | $ | 11 | ||||||||||||||||||
| A$ | 80,000 | U.S.$ | 62,032 | 0.7754 | Prepaid Exp | 738 | 0 | 738 | |||||||||||||||||||||
| U.S.$ | 75,102 | £ | 55,000 | 0.7323 | Prepaid Exp | 357 | 0 | 357 | |||||||||||||||||||||
| £ | 200,000 | U.S.$ | 274,853 | 1.3743 | Prepaid Exp | 32 | 0 | 32 | |||||||||||||||||||||
| € | 200,000 | U.S.$ | 244,699 | 1.2235 | Prepaid Exp / (Accrued Exp) | 427 | (182) | 245 | |||||||||||||||||||||
| Economic hedges for which hedge accounting was not elected: | |||||||||||||||||||||||||||||
| Diesel fuel contracts | Fixed on 1.5M – 3.8M gal per month | Float on 1.5M– 3.8M gal per month | N/A | Prepaid Exp | 4,880 | 0 | 4,880 | ||||||||||||||||||||||
| Merchandise purchase commitments: | |||||||||||||||||||||||||||||
| C$ | 384,679 | U.S.$ | 296,000 | 0.7695 | Prepaid Exp / (Accrued Exp) | 430 | (5,627) | (5,197) | |||||||||||||||||||||
| C$ | 5,391 | € | 3,500 | 0.6492 | Prepaid Exp | 24 | 0 | 24 | |||||||||||||||||||||
| £ | 203,264 | U.S.$ | 263,950 | 1.2986 | (Accrued Exp) | 0 | (15,086) | (15,086) | |||||||||||||||||||||
| zł | 30,000 | £ | 5,865 | 0.1955 | (Accrued Exp) | 0 | (29) | (29) | |||||||||||||||||||||
| A$ | 46,985 | U.S.$ | 35,250 | 0.7502 | Prepaid Exp / (Accrued Exp) | 144 | (837) | (693) | |||||||||||||||||||||
| U.S.$ | 99,810 | € | 83,700 | 0.8386 | Prepaid Exp / (Accrued Exp) | 1,986 | (160) | 1,826 | |||||||||||||||||||||
| Total fair value of derivative financial instruments | $ | 9,029 | $ | (21,921) | $ | (12,892) | |||||||||||||||||||||||
In thousands | Pay | Receive | Blended Contract Rate | Balance Sheet | Current Asset U.S.$ | Current (Liability) U.S.$ | Net Fair Value in U.S.$ at October 29, 2016 | |||||||||||||||||||||
Fair value hedges: | ||||||||||||||||||||||||||||
Intercompany balances, primarily debt and related interest |
| |||||||||||||||||||||||||||
| zł | 57,073 | C$ | 19,606 | 0.3435 | Prepaid Exp | $ | 199 | $ | — | $ | 199 | |||||||||||||||||
| zł | 45,000 | £ | 7,403 | 0.1645 | (Accrued Exp) | — | (2,357 | ) | (2,357 | ) | ||||||||||||||||||
| € | 61,000 | £ | 47,211 | 0.7740 | (Accrued Exp) | — | (9,681 | ) | (9,681 | ) | ||||||||||||||||||
| U.S.$ | 77,957 | £ | 55,000 | 0.7055 | (Accrued Exp) | — | (10,999 | ) | (10,999 | ) | ||||||||||||||||||
| £ | 25,000 | C$ | 41,123 | 1.6449 | Prepaid Exp | 45 | — | 45 | ||||||||||||||||||||
Economic hedges for which hedge accounting was not elected: |
| |||||||||||||||||||||||||||
Diesel contracts | | Fixed on 2.1M – 2.3M gal per month | | | Float on 2.1M – 2.3M gal per month | | N/A | Prepaid Exp | 1,485 | — | 1,485 | |||||||||||||||||
Intercompany billings in Europe, primarily merchandise related | € | 88,000 | £ | 79,577 | 0.9043 | Prepaid Exp | 186 | — | 186 | |||||||||||||||||||
Merchandise purchase commitments |
| |||||||||||||||||||||||||||
| C$ | 461,631 | U.S.$ | 355,350 | 0.7698 | Prepaid Exp | 10,434 | — | 10,434 | ||||||||||||||||||||
| C$ | 21,643 | € | 14,900 | 0.6885 | Prepaid Exp | 217 | — | 217 | ||||||||||||||||||||
| £ | 191,518 | U.S.$ | 252,600 | 1.3189 | Prepaid Exp / (Accrued Exp) | 18,824 | (626 | ) | 18,198 | |||||||||||||||||||
| zł | 258,005 | £ | 50,292 | 0.1949 | Prepaid Exp / (Accrued Exp) | 1 | (3,875 | ) | (3,874 | ) | ||||||||||||||||||
| U.S.$ | 675 | £ | 468 | 0.6934 | (Accrued Exp) | — | (106 | ) | (106 | ) | ||||||||||||||||||
| U.S.$ | 49,288 | € | 43,819 | 0.8891 | Prepaid Exp / (Accrued Exp) | 19 | (1,122 | ) | (1,103 | ) | ||||||||||||||||||
|
|
|
|
|
| |||||||||||||||||||||||
Total fair value of derivative financial instruments |
| $ | 31,410 | $ | (28,766 | ) | $ | 2,644 | ||||||||||||||||||||
|
|
|
|
|
| |||||||||||||||||||||||
16
May 2, 2020:
| In thousands | Pay | Receive | Blended Contract Rate | Balance Sheet Location | Current Asset U.S.$ | Current (Liability) U.S.$ | Net Fair Value in U.S.$ at May 2, 2020 | ||||||||||||||||||||||
| Fair value hedges: | |||||||||||||||||||||||||||||
| Intercompany balances, primarily debt and related interest: | |||||||||||||||||||||||||||||
| zł | 65,000 | £ | 12,780 | 0.1966 | Prepaid Exp | $ | 351 | $ | 0 | $ | 351 | ||||||||||||||||||
| € | 60,000 | £ | 53,412 | 0.8902 | Prepaid Exp | 437 | 0 | 437 | |||||||||||||||||||||
| A$ | 110,000 | U.S.$ | 70,802 | 0.6437 | Prepaid Exp / (Accrued Exp) | 1,788 | (1,656) | 132 | |||||||||||||||||||||
| U.S.$ | 72,475 | £ | 55,000 | 0.7589 | (Accrued Exp) | 0 | (3,744) | (3,744) | |||||||||||||||||||||
| £ | 200,000 | U.S.$ | 249,499 | 1.2475 | Prepaid Exp / (Accrued Exp) | 999 | (2,332) | (1,333) | |||||||||||||||||||||
| C$ | 350,000 | U.S.$ | 248,821 | 0.7109 | Prepaid Exp / (Accrued Exp) | 640 | (478) | 162 | |||||||||||||||||||||
| Economic hedges for which hedge accounting was not elected: | |||||||||||||||||||||||||||||
| Diesel fuel contracts | Fixed on 2.9M – 3.5M gal per month | Float on 2.9M – 3.5M gal per month | N/A | (Accrued Exp) | 0 | (30,167) | (30,167) | ||||||||||||||||||||||
| Intercompany billings in TJX International, primarily merchandise related: | |||||||||||||||||||||||||||||
| € | 49,100 | £ | 43,144 | 0.8787 | (Accrued Exp) | 0 | (65) | (65) | |||||||||||||||||||||
| Merchandise purchase commitments: | |||||||||||||||||||||||||||||
| C$ | 77,979 | U.S.$ | 59,200 | 0.7592 | Prepaid Exp | 3,819 | 0 | 3,819 | |||||||||||||||||||||
| £ | 63,618 | U.S.$ | 82,200 | 1.2921 | Prepaid Exp | 2,469 | 0 | 2,469 | |||||||||||||||||||||
| A$ | 17,438 | U.S.$ | 11,780 | 0.6755 | Prepaid Exp | 578 | 0 | 578 | |||||||||||||||||||||
| zł | 69,400 | £ | 13,880 | 0.2000 | Prepaid Exp | 666 | 0 | 666 | |||||||||||||||||||||
| U.S.$ | 30,651 | € | 27,588 | 0.9001 | Prepaid Exp / (Accrued Exp) | 30 | (404) | (374) | |||||||||||||||||||||
| Total fair value of derivative financial instruments | $ | 11,777 | $ | (38,846) | $ | (27,069) | |||||||||||||||||||||||
| Amount of Gain (Loss) Recognized in Income by Derivative | ||||||||||
| Thirteen Weeks Ended | ||||||||||
In thousands | Location of Gain (Loss) Recognized in Income by Derivative | October 28, 2017 | October 29, 2016 | |||||||
Fair value hedges: | ||||||||||
Intercompany balances, primarily debt and related interest | Selling, general and administrative expenses | $ | (1,454 | ) | $ | (10,549 | ) | |||
Economic hedges for which hedge accounting was not elected: | ||||||||||
Diesel fuel contracts | Cost of sales, including buying and occupancy costs | 4,947 | 4,241 | |||||||
Intercompany billings in Europe, primarily merchandise related | Cost of sales, including buying and occupancy costs | 328 | (5,911 | ) | ||||||
Merchandise purchase commitments | Cost of sales, including buying and occupancy costs | 13,336 | 23,105 | |||||||
|
|
|
| |||||||
Gain recognized in income | $ | 17,157 | $ | 10,886 | ||||||
|
|
|
| |||||||
| Amount of Gain (Loss) Recognized in Income by Derivative | ||||||||||
| Thirty-Nine Weeks Ended | ||||||||||
In thousands | Location of Gain (Loss) Recognized in Income by Derivative | October 28, 2017 | October 29, 2016 | |||||||
Fair value hedges: | ||||||||||
Intercompany balances, primarily debt and related interest | Selling, general and administrative expenses | $ | (3,820 | ) | $ | (23,835 | ) | |||
Economic hedges for which hedge accounting was not elected: | ||||||||||
Diesel fuel contracts | Cost of sales, including buying and occupancy costs | 3,630 | 3,012 | |||||||
Intercompany billings in Europe, primarily merchandise related | Cost of sales, including buying and occupancy costs | (3,116 | ) | (14,987 | ) | |||||
Merchandise purchase commitments | Cost of sales, including buying and occupancy costs | (20,829 | ) | 15,826 | ||||||
|
|
|
| |||||||
Loss recognized in income | $ | (24,135 | ) | $ | (19,984 | ) | ||||
|
|
|
| |||||||
17
| Amount of (Loss) Gain Recognized in Income / (Loss) by Derivative | |||||||||||||||||
Location of (Loss) Gain Recognized in Income / (Loss) by Derivative | Thirteen Weeks Ended | ||||||||||||||||
| In thousands | May 1, 2021 | May 2, 2020 | |||||||||||||||
| Fair value hedges: | |||||||||||||||||
| Intercompany balances, primarily debt and related interest | Selling, general and administrative expenses | $ | (2,864) | $ | (5,173) | ||||||||||||
| Economic hedges for which hedge accounting was not elected: | |||||||||||||||||
| Diesel fuel contracts | Cost of sales, including buying and occupancy costs | 13,570 | (22,854) | ||||||||||||||
| Intercompany billings in TJX International, primarily merchandise related | Cost of sales, including buying and occupancy costs | 118 | (1,852) | ||||||||||||||
| Merchandise purchase commitments | Cost of sales, including buying and occupancy costs | (15,969) | 50,135 | ||||||||||||||
| (Loss) gain recognized in income / (loss) | $ | (5,145) | $ | 20,256 | |||||||||||||
| Level 1: | Unadjusted quoted prices in active markets for identical assets or liabilities | |||||||
| Level 2: | Unadjusted quoted prices in active markets for similar assets or liabilities, or unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs other than quoted prices that are observable for the asset or liability |
| Level 3: | Unobservable inputs for the asset or liability |
In thousands | October 28, 2017 | January 28, 2017 | October 29, 2016 | |||||||||
Level 1 | ||||||||||||
Assets: | ||||||||||||
Executive Savings Plan investments | $ | 231,618 | $ | 195,733 | $ | 185,042 | ||||||
Level 2 | ||||||||||||
Assets: | ||||||||||||
Short-term investments | $ | 511,618 | $ | 543,242 | $ | 450,804 | ||||||
Foreign currency exchange contracts | 11,884 | 6,018 | 29,925 | |||||||||
Diesel fuel contracts | 5,226 | 2,183 | 1,485 | |||||||||
Liabilities: | ||||||||||||
Foreign currency exchange contracts | $ | 11,280 | $ | 7,256 | $ | 28,766 | ||||||
| In thousands | May 1, 2021 | January 30, 2021 | May 2, 2020 | ||||||||
| Level 1 | |||||||||||
| Assets: | |||||||||||
| Executive Savings Plan investments | $ | 384,442 | $ | 363,729 | $ | 296,031 | |||||
| Level 2 | |||||||||||
| Assets: | |||||||||||
| Foreign currency exchange contracts | $ | 6,365 | $ | 4,149 | $ | 11,777 | |||||
| Diesel fuel contracts | 17,816 | 4,880 | 0 | ||||||||
| Liabilities: | |||||||||||
| Foreign currency exchange contracts | $ | 21,718 | $ | 21,921 | $ | 8,679 | |||||
| Diesel fuel contracts | 0 | 0 | 30,167 | ||||||||
Short-term investments, foreign
18
| Thirteen Weeks Ended | ||||||||
In thousands | October 28, 2017 | October 29, 2016 | ||||||
Net sales: | ||||||||
In the United States: | ||||||||
Marmaxx | $ | 5,298,479 | $ | 5,252,815 | ||||
HomeGoods | 1,228,768 | 1,078,373 | ||||||
TJX Canada | 983,236 | 855,473 | ||||||
TJX International | 1,251,737 | 1,105,027 | ||||||
|
|
|
| |||||
| $ | 8,762,220 | $ | 8,291,688 | |||||
|
|
|
| |||||
Segment profit: | ||||||||
In the United States: | ||||||||
Marmaxx | $ | 666,092 | $ | 703,092 | ||||
HomeGoods | 163,835 | 149,739 | ||||||
TJX Canada | 206,472 | 142,491 | ||||||
TJX International | 87,066 | 87,821 | ||||||
|
|
|
| |||||
| 1,123,465 | 1,083,143 | |||||||
General corporate expense | 95,484 | 97,902 | ||||||
Loss on early extinguishment of debt | — | 51,773 | ||||||
Pension settlement charge | — | 31,173 | ||||||
Interest expense, net | 7,981 | 12,462 | ||||||
|
|
|
| |||||
Income before provision for income taxes | $ | 1,020,000 | $ | 889,833 | ||||
|
|
|
| |||||
19
| Thirty-Nine Weeks Ended | ||||||||
In thousands | October 28, 2017 | October 29, 2016 | ||||||
Net sales: | ||||||||
In the United States: | ||||||||
Marmaxx | $ | 15,550,253 | $ | 15,217,188 | ||||
HomeGoods | 3,506,435 | 3,075,472 | ||||||
TJX Canada | 2,554,033 | 2,297,831 | ||||||
TJX International | 3,293,223 | 3,125,606 | ||||||
|
|
|
| |||||
| $ | 24,903,944 | $ | 23,716,097 | |||||
|
|
|
| |||||
Segment profit: | ||||||||
In the United States: | ||||||||
Marmaxx | $ | 2,100,138 | $ | 2,154,238 | ||||
HomeGoods | 457,272 | 415,996 | ||||||
TJX Canada | 392,581 | 321,942 | ||||||
TJX International | 132,893 | 145,047 | ||||||
|
|
|
| |||||
| 3,082,884 | 3,037,223 | |||||||
General corporate expense | 311,177 | 290,975 | ||||||
Loss on early extinguishment of debt | — | 51,773 | ||||||
Pension settlement charge | — | 31,173 | ||||||
Interest expense, net | 27,499 | 33,918 | ||||||
|
|
|
| |||||
Income before provision for income taxes | $ | 2,744,208 | $ | 2,629,384 | ||||
|
|
|
| |||||
20
| Thirteen Weeks Ended | ||||||||||||||
| In thousands | May 1, 2021 | May 2, 2020 | ||||||||||||
| Net sales: | ||||||||||||||
| In the United States: | ||||||||||||||
| Marmaxx | $ | 6,640,486 | $ | 2,697,779 | ||||||||||
| HomeGoods | 2,141,756 | 759,865 | ||||||||||||
| TJX Canada | 765,536 | 379,636 | ||||||||||||
| TJX International | 538,883 | 571,608 | ||||||||||||
| Total net sales | $ | 10,086,661 | $ | 4,408,888 | ||||||||||
| Segment profit (loss): | ||||||||||||||
| In the United States: | ||||||||||||||
| Marmaxx | $ | 824,855 | $ | (709,669) | ||||||||||
| HomeGoods | 251,602 | (153,703) | ||||||||||||
| TJX Canada | 71,577 | (97,181) | ||||||||||||
| TJX International | (221,558) | (258,617) | ||||||||||||
| Total segment profit (loss) | 926,476 | (1,219,170) | ||||||||||||
| General corporate expense | 160,442 | 100,327 | ||||||||||||
| Interest expense, net | 44,688 | 23,351 | ||||||||||||
| Income (loss) before income taxes | $ | 721,346 | $ | (1,342,848) | ||||||||||
| Funded Plan | Unfunded Plan | |||||||||||||||
| Thirteen Weeks Ended | Thirteen Weeks Ended | |||||||||||||||
In thousands | October 28, 2017 | October 29, 2016 | October 28, 2017 | October 29, 2016 | ||||||||||||
Service cost | $ | 11,655 | $ | 11,360 | $ | 403 | $ | 293 | ||||||||
Interest cost | 13,866 | 14,023 | 820 | 793 | ||||||||||||
Expected return on plan assets | (17,309 | ) | (17,633 | ) | — | — | ||||||||||
Recognized actuarial losses | 5,428 | 7,943 | 641 | 783 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Expense related to current period | 13,640 | 15,693 | 1,864 | 1,869 | ||||||||||||
Pension settlement charge | — | 31,173 | — | — | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total expense | $ | 13,640 | $ | 46,866 | $ | 1,864 | $ | 1,869 | ||||||||
|
|
|
|
|
|
|
| |||||||||
| Funded Plan | Unfunded Plan | |||||||||||||||
| Thirty-Nine Weeks Ended | Thirty-Nine Weeks Ended | |||||||||||||||
In thousands | October 28, 2017 | October 29, 2016 | October 28, 2017 | October 29, 2016 | ||||||||||||
Service cost | $ | 35,264 | $ | 33,778 | $ | 1,578 | $ | 1,376 | ||||||||
Interest cost | 41,384 | 42,747 | 2,506 | 2,543 | ||||||||||||
Expected return on plan assets | (52,073 | ) | (53,503 | ) | — | — | ||||||||||
Recognized actuarial losses | 16,582 | 22,362 | 2,305 | 2,512 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Net periodic pension cost | 41,157 | 45,384 | 6,389 | 6,431 | ||||||||||||
Pension settlement charge | — | 31,173 | — | — | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total expense | $ | 41,157 | $ | 76,557 | $ | 6,389 | $ | 6,431 | ||||||||
|
|
|
|
|
|
|
| |||||||||
| Funded Plan | Unfunded Plan | |||||||||||||
| Thirteen Weeks Ended | Thirteen Weeks Ended | |||||||||||||
| In thousands | May 1, 2021 | May 2, 2020 | May 1, 2021 | May 2, 2020 | ||||||||||
| Service cost | $ | 12,219 | $ | 12,540 | $ | 755 | $ | 709 | ||||||
| Interest cost | 12,812 | 12,519 | 780 | 801 | ||||||||||
| Expected return on plan assets | (23,992) | (22,242) | 0 | 0 | ||||||||||
| Amortization of net actuarial loss and prior service cost | 2,803 | 5,509 | 1,154 | 1,034 | ||||||||||
| Total expense | $ | 3,842 | $ | 8,326 | $ | 2,689 | $ | 2,544 | ||||||
2022.
During the third quarter of fiscal 2017, TJX offered eligible, former TJX Associates, who had not yet commenced receiving their pension benefit, an opportunity to receive a lump sum payout of their vested pension benefit. As a result, the Company’s pension plan paid $103.2 million from pension plan assets to those who accepted the offer, thereby reducing its pension benefit obligations. The transaction had no cash impact on TJX but did result in anon-cashpre-tax pension settlement charge of $31.2 million in last year’s third quarter, which is reported separately on the consolidated statements of income.
TJX also had maintained an unfunded postretirement medical plan, which was closed to new benefits in fiscal 2006. During the first quarter of fiscal 2017, TJX terminated the unfunded postretirement medical plan and made a discretionary lump sum payment to participants. The settlement of the liability and the recognition of the remaining negative plan amendment resulted in apre-tax benefit of $5.5 million in the first quarter of fiscal 2017.
21
In thousands | October 28, 2017 | January 28, 2017 | October 29, 2016 | |||||||||
General corporate debt: | ||||||||||||
2.50% senior unsecured notes, maturing May 15, 2023 (effective interest rate of 2.51% after reduction of unamortized debt discount of $245 at October 28, 2017, $278 at January 28, 2017 and $289 at October 29, 2016) | $ | 499,755 | $ | 499,722 | $ | 499,711 | ||||||
2.75% senior unsecured notes, maturing June 15, 2021 (effective interest rate of 2.76% after reduction of unamortized debt discount of $269 at October 28, 2017, $325 at January 28, 2017 and $344 at October 29, 2016) | 749,732 | 749,675 | 749,656 | |||||||||
2.25% senior unsecured notes, maturing September 15, 2026 (effective interest rate of 2.32% after reduction of unamortized debt discount of $6,590 at October 28, 2017, $7,149 at January 28, 2017 and $7,336 at October 29, 2016) | 993,410 | 992,851 | 992,664 | |||||||||
Debt issuance cost | (13,042 | ) | (14,649 | ) | (15,118 | ) | ||||||
|
|
|
|
|
| |||||||
Long-term debt | $ | 2,229,855 | $ | 2,227,599 | $ | 2,226,913 | ||||||
|
|
|
|
|
| |||||||
On September 12, 2016, TJX issued $1.0
| In thousands | May 1, 2021 | January 30, 2021 | May 2, 2020 | ||||||||
| Revolving credit facilities: | |||||||||||
| $500 million revolver, maturing March 11, 2022 | $ | 0 | $ | 0 | $ | 500,000 | |||||
| $500 million revolver, maturing May 10, 2024 | 0 | 0 | 500,000 | ||||||||
| General corporate debt: | |||||||||||
| 2.750% senior unsecured notes, redeemed on April 15, 2021 (effective interest rate of 2.76% after reduction of unamortized debt discount of $25 at January 30, 2021 and $81 at May 2, 2020) | $ | — | $ | 749,975 | $ | 749,919 | |||||
| 2.500% senior unsecured notes, maturing May 15, 2023 (effective interest rate of 2.51% after reduction of unamortized debt discount of $89 at May 1, 2021, $100 at January 30, 2021 and $134 at May 2, 2020) | 499,911 | 499,900 | 499,866 | ||||||||
| 3.500% senior unsecured notes, maturing April 15, 2025 (effective interest rate of 3.58% after reduction of unamortized debt discount of $3,956 at May 1, 2021, $4,208 at January 30, 2021 and $4,966 at May 2, 2020) | 1,246,044 | 1,245,792 | 1,245,034 | ||||||||
| 2.250% senior unsecured notes, maturing September 15, 2026 (effective interest rate of 2.32% after reduction of unamortized debt discount of $3,979 at May 1, 2021, $4,165 at January 30, 2021 and $4,725 at May 2, 2020) | 996,021 | 995,835 | 995,275 | ||||||||
| 3.750% senior unsecured notes, maturing April 15, 2027 (effective interest rate of 3.76% after reduction of unamortized debt discount of $437 at May 1, 2021, $456 at January 30, 2021 and $511 at May 2, 2020) | 749,563 | 749,544 | 749,489 | ||||||||
| 1.150% senior unsecured notes, maturing May 15, 2028 (effective interest rate of 1.18% after reduction of unamortized debt discount of $907 at May 1, 2021 and $939 at January 30, 2021) | 499,093 | 499,061 | 0 | ||||||||
| 3.875% senior unsecured notes, maturing April 15, 2030, see tender offer details below (effective interest rate of 3.89% after reduction of unamortized debt discount of $553 at May 1, 2021, $568 at January 30, 2021 and $1,549 at May 2, 2020) | 495,297 | 495,282 | 1,248,451 | ||||||||
| 1.600% senior unsecured notes, maturing May 15, 2031 (effective interest rate of 1.61% after reduction of unamortized debt discount of $595 at May 1, 2021 and $610 at January 30, 2021) | 499,405 | 499,390 | 0 | ||||||||
| 4.500% senior unsecured notes, maturing April 15, 2050; see tender offer details below (effective interest rate of 4.52% after reduction of unamortized debt discount of $2,189 at May 1, 2021, $2,208 at January 30, 2021 and $4,405 at May 2, 2020) | 383,310 | 383,291 | 745,595 | ||||||||
| Total debt | 5,368,644 | 6,118,070 | 7,233,629 | ||||||||
| Current maturities of long-term debt, net of debt issuance costs | 0 | (749,684) | 0 | ||||||||
| Debt issuance costs | (33,780) | (35,465) | (41,216) | ||||||||
| Long-term debt | $ | 5,334,864 | $ | 5,332,921 | $ | 7,192,413 | |||||
At October 28, 2017,fiscal 2022.
At October 28, 2017, TJX had two $500 million revolving credit facilities, one whichfacility that matures in March 20202022 (the “2022 Revolving Credit Facility”) and one whicha $500 million revolving credit facility that matures in March 2022. At October 28, 2017,May 2024 (the “2024 Revolving Credit Facility”). Under these credit facilities, the agreementsCompany has borrowing capacity of $1.5 billion, all of which remains available to the Company.
22
As of October 28, 2017, January 28, 2017 and October 29, 2016,May 2, 2020, TJX Canada had two2 uncommitted credit lines, a C$10 million facility for operating expenses and a C$10 million letter of credit facility. As of October 28, 2017,May 1, 2021, January 28, 201730, 2021 and October 29, 2016,May 2, 2020, and during the quarters and year then ended, there were no0 amounts outstanding on the Canadian credit line for operating expenses.line. As of October 28, 2017,May 1, 2021, January 28, 2017,30, 2021 and October 29, 2016,May 2, 2020, our European business at TJX International had an uncommitted credit line of £5 million. As of October 28, 2017,May 1, 2021, January 28, 2017,30, 2021 and October 29, 2016,May 2, 2020, and during the quarters and year then ended, there were no0 amounts outstanding on the European credit line.
Economic Security Act (“CARES Act”) enacted on March 27, 2020.
May 2, 2020.
May 2, 2020.
lease obligations and TJX established appropriate reserves. The Company may also be contingently liable on up to nine8 leases of former TJX businesses, for which we believethe Company believes the likelihood of future liability to TJX is remote,remote. The Company may also be contingently liable for assignments and has contingent obligations in connection with certain assigned or sublet properties that TJX is able to estimate. We estimate that the undiscounted obligations of (i) leases of former operations not included in our reserve for former operations and (ii) properties of our former operationssubleases if the assignees or subtenants do not fulfill their obligations. TJX estimates the undiscounted value of these contingent obligations are approximately $46.8 million as of October 28, 2017. We believeMay 1, 2021 to be approximately $9 million. TJX believes that most or all of these contingent obligations will not revert to usthe Company and, to the extent they do, willmay be resolved for substantially less due to mitigating factors including our expectationTJX's ability to potentially further sublet.
23
24
Consolidated Financial Statements.
Operations
May 1, 2021
Overview
May 2, 2020
Results
Highlightsfiscal 2022, while our stores in the United States remained open for the entire first quarter, we had store closures primarily in Europe and Canada, and continue to have store closures, as discussed below. Overall, our first quarter results for fiscal 2022 are significantly better than our results for the first quarter of fiscal 2021, when the pandemic resulted in the temporary closure of all our stores for approximately 50% of the quarter.
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The following is a discussionpayment of our consolidated operating results, followed by a discussion of our segment operating results.
Net sales:Consolidated net sales for the third quarter ended October 28, 2017 totaled $8.8 billion, a 6% increase over consolidated net sales of $8.3 billion for the third quarter ended October 29, 2016. The increase reflected a 5% increase from new store sales and a 1% positive impact from foreign currency exchange rates. This increase compares to sales growth of 7% in last year’s third quarter, which reflected a 5% increase from same store sales, a 4% increase in new store sales, offset by a 2% negative impact from foreign currency exchange rates.
Consolidated net sales for the nine months ended October 28, 2017 totaled $24.9 billion, a 5% increase over $23.7 billion in last year’s comparable period. The increase reflected a 4% increase from new store sales, a 1% increase in same store sales, and a neutral impact from foreign currency exchange rates. This compares to sales growth of 8%dividend declared in the nine-month periodfourth quarter of fiscal 2017, which reflected a 5% increase2020 and share repurchases.
As of October 28, 2017, our consolidated store count increased 7% and selling square footage increased 5% comparedJune 2021 at par.
Consolidated same store salesof fiscal 2022, we announced make-whole calls that will, upon completion, reduce outstanding debt by $2 billion. We also lifted the temporary suspension of our share repurchase programs.
| Thirteen Weeks Ended | ||||||||
| May 1, 2021 | May 2, 2020 | |||||||
| Marmaxx | — | % | 50 | % | ||||
| HomeGoods | — | 49 | ||||||
| TJX Canada | 25 | 53 | ||||||
| TJX International | 69 | 49 | ||||||
| Total | 14 | % | 50 | % | ||||
In2022, fiscal 2021 and fiscal 2020.
We define samereported comp sales results.
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companies.
| Percentage of Net Sales Thirteen Weeks Ended October 28, 2017 | Percentage of Net Sales Thirteen Weeks Ended October 29, 2016 | |||||||
Net sales | 100.0 | % | 100.0 | % | ||||
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Cost of sales, including buying and occupancy costs | 70.2 | 70.5 | ||||||
Selling, general and administrative expenses | 18.1 | 17.6 | ||||||
Loss on early extinguishment of debt | — | 0.6 | ||||||
Pension settlement charge | — | 0.4 | ||||||
Interest expense, net | 0.1 | 0.2 | ||||||
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Income before provision for income taxes* | 11.6 | % | 10.7 | % | ||||
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| Percentage of Net Sales Thirty-Nine Weeks Ended October 28, 2017 | Percentage of Net Sales Thirty-Nine Weeks Ended October 29, 2016 | |||||||
Net sales | 100.0 | % | 100.0 | % | ||||
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Cost of sales, including buying and occupancy costs | 70.9 | 70.7 | ||||||
Selling, general and administrative expenses | 18.0 | 17.7 | ||||||
Loss on early extinguishment of debt | — | 0.2 | ||||||
Pension settlement charge | — | 0.1 | ||||||
Interest expense, net | 0.1 | 0.1 | ||||||
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Income before provision for income taxes* | 11.0 | % | 11.1 | % | ||||
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| May 1, 2021 | May 2, 2020 | May 4, 2019 | ||||||||||||||||||
| Net sales | 100.0 | % | 100.0 | % | 100.0 | % | ||||||||||||||
| Cost of sales, including buying and occupancy costs | 71.9 | 100.1 | 71.5 | |||||||||||||||||
| Selling, general and administrative expenses | 20.5 | 29.8 | 18.3 | |||||||||||||||||
| Interest expense, net | 0.4 | 0.5 | — | |||||||||||||||||
Income (loss) before provision for income taxes* | 7.2 | % | (30.5) | % | 10.1 | % | ||||||||||||||
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We refer to the impact of the above two items throughout our discussion as “foreign currency”.described in detail below. This does not include the impact foreign currency exchange rates can have on various transactions that are denominated in a currency other than an operating division’sdivision's local currency. currency referred to as “transactional foreign exchange,” also described below.
exchange”. This primarily includes the impact that foreign currency exchange rates may have on the year-over-year comparison of merchandise margin as well as “foreign currency gains and losses” on transactions that are denominated in a currency other than the operating division's local currency. These two items can impact segment margin comparison of our foreign divisions and we have highlighted them when they are meaningful to understanding operating trends.
Selling, general and administrative expenses: Selling, general and administrative expenses, as a percentage of2022.
Loss on early extinguishment of debt:On September 12, 2016 we issued $1.0 billion of 2.25% ten-year notes. We used a portion of the proceeds to redeem our $375 million 6.95% notes on October 12, 2016, prior to their scheduled maturity of April 15, 2019 and we recorded apre-tax loss on the early extinguishment of debt of $51.8 million.
Pension settlement charge: During the fiscal 2017 third quarter, we offered eligible former TJX Associates, who had not yet commenced receiving their qualified pension plan benefit, an opportunity to receive a lump sum payout of their vested pension benefit. On October 21, 2016, TJX’s qualified pension plan paid $103.2 million from pension plan assets to those who accepted this offer. This transaction had no cash impact on TJX, but did result in anon-cashpre-tax settlement charge of $31.2 million in the third quarter of last year.
Interest expense, net: Interest expense, net decreased $4.5 million for the third quarter ended October 28, 2017 and decreased $6.4 million for the nine months ended October 28, 2017 as compared to the same periods last year.
| Thirteen Weeks Ended | Thirty-Nine Weeks Ended | |||||||||||||||
Dollars in thousands | October 28, 2017 | October 29, 2016 | October 28, 2017 | October 29, 2016 | ||||||||||||
Interest expense | $ | 17,349 | $ | 18,906 | $ | 51,881 | $ | 52,851 | ||||||||
Capitalized interest | (1,066 | ) | (1,948 | ) | (3,528 | ) | (6,351 | ) | ||||||||
Interest (income) | (8,302 | ) | (4,496 | ) | (20,854 | ) | (12,582 | ) | ||||||||
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Interest expense, net | $ | 7,981 | $ | 12,462 | $ | 27,499 | $ | 33,918 | ||||||||
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| In millions | May 1, 2021 | May 2, 2020 | May 4, 2019 | |||||||||||||||||
| Interest expense | $ | 47.0 | $ | 32.6 | $ | 15.3 | ||||||||||||||
| Capitalized interest | (1.1) | (1.0) | (0.7) | |||||||||||||||||
| Interest (income) | (1.2) | (8.2) | (13.8) | |||||||||||||||||
| Interest expense, net | $ | 44.7 | $ | 23.4 | $ | 0.8 | ||||||||||||||
Income taxes:fiscal 2022, fiscal 2021 and fiscal 2020, respectively. The decrease in the first quarter effective income tax rate was 37.1% for theof fiscal 2018 third quarter and 36.9% for the nine months ended October 28, 2017 compared to 38.2% for the fiscal 2017 third quarter and 38.4% for the nine months ended October 29, 2016. The decrease in the effective income tax rate2022 was primarily due to excess income tax benefits related to share-based payments, which reduced the effective income tax rate by 1.2 percentage points for the third quarter and 1.5 percentage points for the nine months ended October 28, 2017. The jurisdictional mix of income also contributed to the changea result of the effective income tax rate.
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Net income and net income per share: Net income forability to carry back the thirdanticipated loss from the first quarter of fiscal 20182021 to earlier tax years with higher tax rates due to a benefit provided by the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) enacted on March 27, 2020.
Net income for the nine months ended October 28, 2017 was $1.7 billion, or $2.67 per diluted share, compared to $1.6 billion, or $2.43 per diluted share, in last year’s comparable period. Foreign currency had a $0.01 positive impact on earnings per share in the first nine months of fiscal 2018 compared to a $0.01 negative impact on earnings per share in the prior year. The loss on early extinguishment of debt and the pension settlement charge collectively reduced net income by approximately $50.0 million, or $0.08 per share, for both the third quarter and nine months ended October 29, 2016. The benefit in the tax provision due to the change in accounting for share-based compensation increased earnings per share by $0.02 per share for the fiscal 2018 third quarter and $0.06 per share in the first nine months of fiscal 2018.
Our stock repurchase programs, which reduce our weighted average diluted shares outstanding, benefited our earnings per share growth by approximately three percent in both the third quarter and first nine months of fiscal 2018.
2020, respectively.
SEGMENTS
| Thirteen Weeks Ended | Thirty-Nine Weeks Ended | |||||||||||||||
Dollars in millions | October 28, 2017 | October 29, 2016 | October 28, 2017 | October 29, 2016 | ||||||||||||
Net sales | $ | 5,298.5 | $ | 5,252.8 | $ | 15,550.3 | $ | 15,217.2 | ||||||||
Segment profit | $ | 666.1 | $ | 703.1 | $ | 2,100.1 | $ | 2,154.2 | ||||||||
Segment profit as a percentage of net sales | 12.6 | % | 13.4 | % | 13.5 | % | 14.2 | % | ||||||||
(Decrease) increase in same store sales | (1 | )% | 5 | % | 0 | % | 5 | % | ||||||||
Stores in operation at end of period | ||||||||||||||||
T.J. Maxx | 1,219 | 1,179 | ||||||||||||||
Marshalls | 1,057 | 1,027 | ||||||||||||||
Sierra Trading Post | 26 | 11 | ||||||||||||||
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Total | 2,302 | 2,217 | ||||||||||||||
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Selling square footage at end of period (in thousands) | ||||||||||||||||
T.J. Maxx | 27,034 | 26,501 | ||||||||||||||
Marshalls | 24,827 | 24,614 | ||||||||||||||
Sierra Trading Post | 451 | 209 | ||||||||||||||
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Total | 52,312 | 51,324 | ||||||||||||||
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| Thirteen Weeks Ended | ||||||||||||||
| U.S. dollars in millions | May 1, 2021 | May 2, 2020 | ||||||||||||
| Net sales | $ | 6,640 | $ | 2,698 | ||||||||||
| Segment profit (loss) | $ | 825 | $ | (710) | ||||||||||
| Segment margin | 12.4 | % | (26.3) | % | ||||||||||
| Stores in operation at end of period: | ||||||||||||||
| T.J. Maxx | 1,282 | 1,273 | ||||||||||||
| Marshalls | 1,147 | 1,130 | ||||||||||||
| Sierra | 52 | 46 | ||||||||||||
| Total | 2,481 | 2,449 | ||||||||||||
| Selling square footage at end of period (in thousands): | ||||||||||||||
| T.J. Maxx | 27,872 | 27,776 | ||||||||||||
| Marshalls | 26,187 | 25,907 | ||||||||||||
| Sierra | 853 | 766 | ||||||||||||
| Total | 54,912 | 54,449 | ||||||||||||
the first quarter of fiscal 2021. The first quarter of fiscal 2021 also reflects $88 million of government programs.
first quarter of fiscal 2022. We temporarily closed our online businesses for a portion of the first quarter of fiscal 2021 as a result of the COVID-19 pandemic.
| Thirteen Weeks Ended | Thirty-Nine Weeks Ended | |||||||||||||||
Dollars in millions | October 28, 2017 | October 29, 2016 | October 28, 2017 | October 29, 2016 | ||||||||||||
Net sales | $ | 1,228.8 | $ | 1,078.4 | $ | 3,506.4 | $ | 3,075.5 | ||||||||
Segment profit | $ | 163.8 | $ | 149.7 | $ | 457.3 | $ | 416.0 | ||||||||
Segment profit as a percentage of net sales | 13.3 | % | 13.9 | % | 13.0 | % | 13.5 | % | ||||||||
Increase in same store sales | 3 | % | 6 | % | 4 | % | 7 | % | ||||||||
Stores in operation at end of period | ||||||||||||||||
HomeGoods | 660 | 568 | ||||||||||||||
Homesense | 3 | — | ||||||||||||||
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Total | 663 | 568 | ||||||||||||||
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Selling square footage at end of period (in thousands) | ||||||||||||||||
HomeGoods | 12,332 | 10,931 | ||||||||||||||
Homesense | 62 | — | ||||||||||||||
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Total | 12,394 | 10,931 | ||||||||||||||
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| U.S. dollars in millions | May 1, 2021 | May 2, 2020 | ||||||||||||
| Net sales | $ | 2,142 | $ | 760 | ||||||||||
| Segment profit (loss) | $ | 252 | $ | (154) | ||||||||||
| Segment margin | 11.7 | % | (20.2) | % | ||||||||||
| Stores in operation at end of period: | ||||||||||||||
| HomeGoods | 843 | 814 | ||||||||||||
| Homesense | 39 | 34 | ||||||||||||
| Total | 882 | 848 | ||||||||||||
| Selling square footage at end of period (in thousands): | ||||||||||||||
| HomeGoods | 15,425 | 14,915 | ||||||||||||
| Homesense | 837 | 733 | ||||||||||||
| Total | 16,262 | 15,648 | ||||||||||||
Segment profit margin decreased to 13.3% for the third quarter of fiscal 2018 compared to 13.9% for the same period last year. Segment profit margin decreased to 13.0% for the nine months ended October 28, 2017 compared to 13.5% for the same period last year. The decline in segment margin for the third quarter and nine-month period was primarily due to an increase in supply chain costs and freight costs. Segment margin for the third quarter and the first nine months of fiscal 2018 was also unfavorably impacted by higher store payroll costs due to wage increases, as well as higher preopening costs due to an increase in new store openings, includingstart-up costs associated with our new Homesense chain in the U.S. For the nine-month period, these costs were partially offset by expense leverage on the 4% same store sales increase.
Three U.S. Homesense stores opened during the quarter, with one more scheduled to open before the end of fiscal 2018.
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Foreign Segments:
TJX Canada
| Thirteen Weeks Ended | Thirty-Nine Weeks Ended | |||||||||||||||
U.S. Dollars in millions | October 28, 2017 | October 29, 2016 | October 28, 2017 | October 29, 2016 | ||||||||||||
Net sales | $ | 983.2 | $ | 855.5 | $ | 2,554.0 | $ | 2,297.8 | ||||||||
Segment profit | $ | 206.5 | $ | 142.5 | $ | 392.6 | $ | 321.9 | ||||||||
Segment profit as a percentage of net sales | 21.0 | % | 16.7 | % | 15.4 | % | 14.0 | % | ||||||||
Increase in same store sales | 4 | % | 8 | % | 4 | % | 10 | % | ||||||||
Stores in operation at end of period | ||||||||||||||||
Winners | 265 | 255 | ||||||||||||||
HomeSense | 117 | 106 | ||||||||||||||
Marshalls | 72 | 57 | ||||||||||||||
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Total | 454 | 418 | ||||||||||||||
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Selling square footage at end of period (in thousands) | ||||||||||||||||
Winners | 5,795 | 5,629 | ||||||||||||||
HomeSense | 2,179 | 1,984 | ||||||||||||||
Marshalls | 1,599 | 1,307 | ||||||||||||||
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Total | 9,573 | 8,920 | ||||||||||||||
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Net sales for TJX Canada increased 15% for the third quarter and 11% for the nine months ended October 28, 2017 as compared to the same periods last year. The quarterly increase reflects a 6% increase in new store sales and a 4% increase from same store sales, as well as currency translation, which positively impacted sales growth by 5%. The nine-month increase in net sales included new store sales growth of 6% and 4% from same store sales, as well as a positive 1% impact due to currency translation. The increase in same store sales for both periods was mainly driven by an increase in customer traffic. Net sales for both periods also reflected an increase in units sold that was mostly offset by a decrease in the average ticket.
Segment profit margin increased to 21.0% for the third quarter of fiscal 2018 compared to 16.7% for the same period last year. Segment profit margin increased to 15.4% for the nine months ended October 28, 2017 compared to 14.0% for the nine months ended October 29, 2016. The increase in the segment margin for the quarter and nine-month period included a favorable impact of 1.9 percentage points and 0.3 percentage points, respectively, due to foreign currency, primarily themark-to-market impact of the inventory derivatives. The fiscal third quarter segment margin was favorably impacted by transactional foreign exchange, improved merchandise margin and reduced supply chain cost. The transactional foreign exchange benefit in the third quarter was due to the revaluing of U.S. dollar denominated monetary assets and liabilities resulting in gains this year as compared to losses in last year’s third quarter. The increase in segment margin for the nine-month period was primarily driven by an improved merchandise margin of 0.9 percentage points, which benefitted from the year-over-year increase in the Canadian dollar.
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TJX International
| Thirteen Weeks Ended | Thirty-Nine Weeks Ended | |||||||||||||||
U.S. Dollars in millions | October 28, 2017 | October 29, 2016 | October 28, 2017 | October 29, 2016 | ||||||||||||
Net sales | $ | 1,251.7 | $ | 1,105.0 | $ | 3,293.2 | $ | 3,125.6 | ||||||||
Segment profit | $ | 87.1 | $ | 87.8 | $ | 132.9 | $ | 145.0 | ||||||||
Segment profit as a percentage of net sales | 7.0 | % | 7.9 | % | 4.0 | % | 4.6 | % | ||||||||
Increase in same store sales | 1 | % | 0 | % | 1 | % | 2 | % | ||||||||
Stores in operation at end of period | ||||||||||||||||
T.K. Maxx | 540 | 503 | ||||||||||||||
Homesense | 55 | 44 | ||||||||||||||
T.K. Maxx Australia | 38 | 35 | ||||||||||||||
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Total | 633 | 582 | ||||||||||||||
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Selling square footage at end of period (in thousands) | ||||||||||||||||
T.K. Maxx | 11,379 | 10,804 | ||||||||||||||
Homesense | 883 | 713 | ||||||||||||||
T.K. Maxx Australia | 714 | 667 | ||||||||||||||
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Total | 12,976 | 12,184 | ||||||||||||||
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Net sales for TJX International increased 13% for the third quarter and 5% for the nine months ended October 28, 2017 as compared to the same periods last year. The quarterly increase reflects an 8% increase from new store sales, a 1% increase in same store sales, as well as currency translation that positively impacted sales growth by 4%. The nine-month increase in net sales included an 8% increase from new store sales and a 1% increase in same store sales, which was offset by a negative 4% impact due to currency translation. The increase in same store sales for both periods was driven by an increase in customer traffic whichand average basket.
| Thirteen Weeks Ended | ||||||||||||||
| U.S. dollars in millions | May 1, 2021 | May 2, 2020 | ||||||||||||
| Net sales | $ | 766 | $ | 380 | ||||||||||
| Segment profit (loss) | $ | 72 | $ | (97) | ||||||||||
| Segment margin | 9.3 | % | (25.6) | % | ||||||||||
| Stores in operation at end of period: | ||||||||||||||
| Winners | 284 | 279 | ||||||||||||
| HomeSense | 143 | 139 | ||||||||||||
| Marshalls | 103 | 100 | ||||||||||||
| Total | 530 | 518 | ||||||||||||
| Selling square footage at end of period (in thousands): | ||||||||||||||
| Winners | 6,113 | 6,003 | ||||||||||||
| HomeSense | 2,644 | 2,553 | ||||||||||||
| Marshalls | 2,159 | 2,102 | ||||||||||||
| Total | 10,916 | 10,658 | ||||||||||||
basket, partially offset by reduced customer traffic.
| Thirteen Weeks Ended | ||||||||||||||
| U.S. dollars in millions | May 1, 2021 | May 2, 2020 | ||||||||||||
| Net sales | $ | 539 | $ | 572 | ||||||||||
| Segment (loss) | $ | (222) | $ | (259) | ||||||||||
| Segment margin | (41.1) | % | (45.2) | % | ||||||||||
| Stores in operation at end of period: | ||||||||||||||
| T.K. Maxx | 604 | 596 | ||||||||||||
| Homesense | 78 | 78 | ||||||||||||
| T.K. Maxx Australia | 64 | 56 | ||||||||||||
| Total | 746 | 730 | ||||||||||||
| Selling square footage at end of period (in thousands): | ||||||||||||||
| T.K. Maxx | 12,160 | 12,019 | ||||||||||||
| Homesense | 1,142 | 1,142 | ||||||||||||
| T.K. Maxx Australia | 1,143 | 1,019 | ||||||||||||
| 14,445 | 14,180 | |||||||||||||
General corporate expense
| Thirteen Weeks Ended | Thirty-Nine Weeks Ended | |||||||||||||||
Dollars in millions | October 28, 2017 | October 29, 2016 | October 28, 2017 | October 29, 2016 | ||||||||||||
General corporate expense | $ | 95.5 | $ | 97.9 | $ | 311.2 | $ | 291.0 | ||||||||
2021 reflect $84 million and $46 million, respectively, of government programs.
| Thirteen Weeks Ended | ||||||||||||||
| In millions | May 1, 2021 | May 2, 2020 | ||||||||||||
| General corporate expense | $ | 160 | $ | 100 | ||||||||||
General corporate expense for the quarter decreased slightly from the same period last year, driven by a reduction in incentive compensation costs.
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the mark-to-market adjustment on the fuel hedges.
Analysis of Financial Condition
2022 we have used, and in the future we may use operating cash flow and cash on hand to repay portions of our indebtedness, depending on prevailing market conditions, liquidity requirements, existing economic conditions, contractual restrictions and other factors. As such, we may, from time to time, seek to retire, redeem, prepay or purchase our outstanding debt through redemptions, cash purchases, prepayments, refinancings and/or exchanges, in open market purchases, privately negotiated transactions, by tender offer or otherwise. If we use our operating cash flow and/or cash on hand to repay our debt, it will reduce the amount of cash available for additional capital expenditures.Net cash provided by operating activities was $1.9for the nine months ended October 28, 2017, a decreaseaggregate principal outstanding 3.50% Notes and our $750 million aggregate principal outstanding 3.75% notes, both of $0.2 billion from the $2.1 billion providedwhich series of notes were issued in the nine months ended October 29, 2016. Net income adjusted fornon-cash itemsfirst quarter of fiscal 2021 in response to the COVID-19 pandemic. These make-whole calls are expected to settle on June 4, 2021 and we anticipate recording a pre-tax loss on the early extinguishment of debt for the fiscal 2018 nine-month period, as compared to the first nine monthsthese notes of fiscal 2017, increased cash flows by $60 million. The change in merchandise inventory, net of the related change in accounts payable, resulted in a use of cash of $309approximately $250 million in the first nine monthssecond quarter of fiscal 2018 compared to a use of cash of $234 million2022. Additionally, in the first nine months of fiscal 2017, which unfavorably impacted year over year cash flows by $75 million. This unfavorable impact on cash flows for the first nine months of fiscal 2018 is attributable in part to additional cash outflows to bring in fresh merchandise for the upcoming holiday season as reflected in the increased inventoryin-transit. The change in accrued expenses and other current liabilities, including income taxes payable, had an unfavorable impact on year over year operating cash flows of $218 million, which was driven by increased payments for incentive compensation, and the timing of payments related to sales taxes and income taxes during the first nine months of fiscal 2018 as compared to the prior year. In addition, the year over year comparison of operating cash flows is favorably impacted by $60 million due to the change in accounting for excess tax benefits related to stock compensation. This year these benefits are included in net income, increasing operating cash flows, whereas last year these benefits were classified as a financing activity.Investing activities in the first nine months of fiscal 2018 reflect property additions for new stores, store improvements and renovations and investment in our home offices and our distribution network (including buying and merchandising systems and information systems). Cash outflows for property additions amounted to $828 million in the quarter ended October 28, 2017 compared to $767 million in the comparable period last year. We anticipate that capital spending for fiscal 2018 will be approximately $1.1 billion. We also purchased $630 million of investments in the first nine months of fiscal 2018 versus $534 million in the comparable prior year period and $658 million of investments were sold or matured in the first nine months of fiscal 2018 versus $432 million in the prior year. This activity primarily related to short-term investments, which had initial maturities in excess of 90 days and, per our policy, are not classified as cash on the consolidated balance sheets presented.Cash flows from financing activities resulted in a net cash outflow of $1.7 billion in the third quarter of fiscal 2018 compared2022, we redeemed $750 million principal outstanding, 2.75% Notes due June 15, 2021. The result of these debt redemptions once completed are expected to be a net cash outflow$2.75 billion reduction of $.9 billion inoutstanding debt since the same period last year. During the fiscal 2017 third quarter we received net proceeds of $992.5 million from the issuance of $1 billion of 2.25%ten-year notes. A portion of the proceeds were used to redeem our $375 million 6.95% notes prior to their scheduled maturity. The redemption of the notes, including the prepayment penalty, resulted in cash outflows of $426 million. Financing activities include the cash flows relating to our repurchases of our common stock, the exercise of options under our stock incentive plan and the payment of dividends to holders of our common stock. We spent $1.2 billion to repurchase 16.9 million shares of our stock in the first nine monthsbeginning of fiscal 2018 compared to $1.2 billion to repurchase 15.42022 and more than $90 million shares in the same period last year. Seeof annualized interest expense savings. For additional information on these transactions, see Note DI—Long-Term Debt and Credit Lines of Notes to Consolidated Financial Statements for more information. Statements.February 2017, we announced an additional repurchase program authorizing the repurchase of up to an additional $1.0 billion of TJX stock from time to time. We currently plan to repurchase approximately $1.5 billion to $1.8 billion of stock under our stock repurchase programs in fiscal 2018. We determine the timing and amount of repurchases based on our assessment of various factors including excess cash flow, liquidity, economic and market conditions, our assessment of prospects for our business, legal requirements and other factors. The timing and amount of these purchases may change. Financing activities also included $72 million of proceeds, net of shares repurchased for withholding taxes, relatedresponse to the exercise of stock options inpandemic, primarily during the thirdfirst quarter of fiscal 2018 versus $86 million2021, we took several steps to strengthen our financial position and balance sheet and to maintain financial liquidity and flexibility, including, among other things, issuing $4 billion in proceeds, net of shares repurchased for withholding taxes inaggregate principal long-term debt. The challenges posed by the same period last year. Dividends paidCOVID-19 pandemic on common stock in the first nine months of fiscal 2018 were $567 million versus $482 million in the same period last year.We traditionally have funded our working capital requirements, including for seasonal merchandise, primarily through cash generated from operations, supplemented, as needed, by short-term bank borrowingsbusiness continue to evolve and the issuanceseverity and duration of commercial paper. Asthe pandemic is still unknown. Consequently, we will continue to evaluate our financial position in light of October 28, 2017, approximately 60% of our cash was held by our foreign subsidiaries with $249 million held in countries where we have the intention to reinvest any undistributed earnings indefinitely. We have provided for deferred U.S. taxes on all undistributed earnings of our subsidiaries in Canada, Puerto Rico, Italy, India, Hong Kong, and Australia. If we repatriate cash from these subsidiaries, we should not incur additional33tax expense, but our cash would be reduced by the amount of taxes paid. For all other foreign subsidiaries, no income taxes have been provided on the undistributed earnings because such earnings are considered to be indefinitely reinvested in the business. We have no current plans to repatriate cash balances held by such foreign subsidiaries.future developments. We believe our existing cash and cash equivalents, internally generated funds and our credit facilities, described in Note II—Long-Term Debt and Credit Lines of Notes to Consolidated Financial Statements, are more than adequate to meet our operating needs over the next twelve months.year.Recently Issued Accounting Pronouncementspronouncements,standards, see Note AA—Basis of Presentation and Summary of Significant Accounting Policies in our 2016 Form10-K Annual Report and Note A of Notes to Consolidated Financial Statements included in TJX’s Annual Report on Form 10-K for the fiscal year ended January 30, 2021 and Note A—Basis of Presentation and Summary of Significant Accounting Policies of Notes to Consolidated Financial Statements in this Quarterly Report on Form10-Q.Forward-looking Statementsexpansion andexpansion; management of large size and scale; consumer trendsmerchandise sourcing and preferences; various marketing efforts; competition; quality and availability of personnel, training and retention;transport; labor costs and workforce challenges; personnel recruitment, training and retention; data security;security and maintenance and development of information systemstechnology systems; corporate and new technology;retail banner reputation; cash flow; expanding international operations; fluctuations in quarterly operating results and market expectations; mergers, acquisitions, or business investments and divestitures, closings or business consolidations; real estate activities; inventory or asset loss; economic conditions and consumer spending; adversemarket instability; serious disruptions or unseasonable weather;catastrophic events; disproportionate impact of disruptions in the second half of the fiscal year; serious disruptionscommodity availability and pricing; adverse or catastrophic events; corporate and retail banner reputation; quality, safety and other issues with merchandise;unseasonable weather; fluctuations in currency exchange rates; compliance with laws, regulations and orders and changes in laws, regulations and applicable accounting standards; expanding international operations; sourcing and moving merchandise internationally; commodity availability and pricing or increases in utility, transportation or logistics costs; fluctuations in currency exchange rates; fluctuations in quarterly operating results and market expectations; mergers, acquisitions, or business investments, divestitures, closings or business consolidations; outcomes of litigation, legal proceedings and other legal or regulatory matters; quality, safety and other issues with our merchandise; tax matters; real estate activities; cash flow and other factors that may be described in our filings with the Securities and Exchange Commission, including our most recent Annual Report on Form10-K filed 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.
Risk
Procedures
34
Not applicable
Factors
Proceeds
| Total Number of Shares Repurchased(1) | Average Price Paid Per Share(2) | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs(1) | Approximate Dollar Value of Shares that May Yet be Purchased Under the Plans or Programs(3) | |||||||||||||
July 30, 2017 through August 26, 2017 | 1,271,053 | $ | 70.82 | 1,271,053 | $ | 1,800,767,834 | ||||||||||
August 27, 2017 through September 30, 2017 | 1,990,306 | $ | 72.85 | 1,990,306 | $ | 1,655,779,813 | ||||||||||
October 1, 2017 through October 28, 2017 | 1,598,429 | $ | 71.95 | 1,598,429 | $ | 1,540,779,792 | ||||||||||
|
|
|
| |||||||||||||
Total: | 4,859,788 | 4,859,788 | ||||||||||||||
Total Number of Repurchased(a) | Average Price Paid Per Share(b) | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs(c) | Approximate Dollar Value of Shares that May Yet be Purchased Under the Plans or Programs(c) | |||||||||||
| January 31, 2021 through February 27, 2021 | — | $ | — | — | $ | 2,985,692,971 | ||||||||
| February 28, 2021 through April 3, 2021 | — | $ | — | — | $ | 2,985,692,971 | ||||||||
| April 4, 2021 through May 1, 2021 | — | $ | — | — | $ | 2,985,692,971 | ||||||||
| Total | — | — | ||||||||||||
35
| Incorporate by Reference | ||||||||||||||||||||||||
| Exhibit No. | Description | Form | Exhibit No. | Filing Date | ||||||||||||||||||||
| 10.1 | ||||||||||||||||||||||||
| 10.2 | ||||||||||||||||||||||||
| 31.1 | ||||||||||||||||||||||||
| 31.2 | ||||||||||||||||||||||||
| 32.1 | ||||||||||||||||||||||||
| 32.2 | ||||||||||||||||||||||||
| 101 | The following materials from The TJX Companies, Inc.’s Quarterly Report on Form10-Q for the quarter ended | |||||||||||||||||||||||
| 104 | The cover page from The TJX Companies, Inc.’s Quarterly Report on Form 10-Q for the quarter ended May 1, 2021, formatted in Inline XBRL (included in Exhibit 101) | |||||||||||||||||||||||
36
|
Date: November 28, 2017
| THE TJX COMPANIES, INC. | ||||||||||||||
| (Registrant) | ||||||||||||||
| Date: May 28, 2021 | ||||||||||||||
| /s/ Scott Goldenberg | ||||||||||||||
| Scott Goldenberg, Chief Financial Officer | ||||||||||||||
| (Principal Financial and Accounting Officer) | ||||||||||||||
37
Exhibit Index
38