Document and Entity Information
Document and Entity Information (USD $) | ||
3 Months Ended
May. 01, 2010 | Aug. 01, 2009
| |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | TJX COMPANIES INC /DE/ | |
Entity Central Index Key | 0000109198 | |
Document Type | 10-Q | |
Document Period End Date | 2010-05-01 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2,011 | |
Document Fiscal Period Focus | Q1 | |
Current Fiscal Year End Date | --01-29 | |
Entity Well-known Seasoned Issuer | Yes | |
Entity Voluntary Filers | No | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Public Float | $15,271,706,337 | |
Entity Common Stock, Shares Outstanding | 407,979,188 |
Statements of Income (Unaudited
Statements of Income (Unaudited) (USD $) | ||
In Thousands, except Per Share data | 3 Months Ended
May. 01, 2010 | 3 Months Ended
May. 02, 2009 |
Statements of Income [Abstract] | ||
Net sales | $5,016,540 | $4,354,224 |
Cost of sales, including buying and occupancy costs | 3,648,674 | 3,273,346 |
Selling, general and administrative expenses | 821,363 | 735,057 |
Interest expense, net | 10,202 | 6,601 |
Income before provision for income taxes | 536,301 | 339,220 |
Provision for income taxes | 204,867 | 130,006 |
Net income | $331,434 | $209,214 |
Basic earnings per share: | ||
Net income | 0.81 | 0.51 |
Weighted average common shares - basic | 408,053 | 412,544 |
Diluted earnings per share: | ||
Net income | 0.8 | 0.49 |
Weighted average common shares - diluted | 414,400 | 431,920 |
Cash dividends declared per share | 0.15 | 0.12 |
Balance Sheets
Balance Sheets (USD $) | |||
In Thousands | 3 Months Ended
May. 01, 2010 | 3 Months Ended
May. 02, 2009 | 12 Months Ended
Jan. 30, 2010 |
Current assets: | |||
Cash and cash equivalents | $1,833,270 | $1,012,495 | $1,614,607 |
Short-term investments | 126,071 | 56,747 | 130,636 |
Accounts receivable, net | 168,043 | 150,406 | 148,126 |
Merchandise inventories | 2,615,079 | 2,817,711 | 2,532,318 |
Prepaid expenses and other current assets | 240,415 | 231,067 | 255,707 |
Current deferred income taxes, net | 122,539 | 138,487 | 122,462 |
Total current assets | 5,105,417 | 4,406,913 | 4,803,856 |
Property at cost: | |||
Land and buildings | 282,296 | 277,087 | 281,527 |
Leasehold costs and improvements | 1,953,608 | 1,767,692 | 1,930,977 |
Furniture, fixtures and equipment | 3,141,442 | 2,833,906 | 3,087,419 |
Total property at cost | 5,377,346 | 4,878,685 | 5,299,923 |
Less accumulated depreciation and amortization | 3,122,971 | 2,725,948 | 3,026,041 |
Net property at cost | 2,254,375 | 2,152,737 | 2,273,882 |
Property under capital lease, net of accumulated amortization of $19,916; $19,357 and $17,682, respectively | 12,656 | 14,890 | 13,215 |
Other assets | 202,161 | 184,734 | 193,230 |
Goodwill and tradename, net of amortization | 179,901 | 179,593 | 179,794 |
TOTAL ASSETS | 7,754,510 | 6,938,867 | 7,463,977 |
Current liabilities: | |||
Current installments of long-term debt | 0 | 742,227 | 0 |
Obligation under capital lease due within one year | 2,434 | 2,218 | 2,355 |
Accounts payable | 1,684,956 | 1,551,403 | 1,507,892 |
Accrued expenses and other liabilities | 1,079,451 | 982,156 | 1,248,002 |
Federal, foreign and state income taxes payable | 247,794 | 50,250 | 136,737 |
Total current liabilities | 3,014,635 | 3,328,254 | 2,894,986 |
Other long-term liabilities | 688,123 | 734,262 | 697,099 |
Non-current deferred income taxes, net | 222,836 | 148,946 | 192,447 |
Obligation under capital lease, less portion due within one year | 15,194 | 17,628 | 15,844 |
Long-term debt, exclusive of current installments | 774,344 | 374,303 | 774,325 |
Commitments and contingencies | |||
SHAREHOLDERS' EQUITY | |||
Common stock, authorized 1,200,000,000 shares, par value $1, issued and outstanding 407,979,188; 409,386,126 and 413,533,634, respectively | 407,979 | 413,534 | 409,386 |
Additional paid-in capital | 0 | 11,668 | 0 |
Accumulated other comprehensive (loss) | (137,298) | (188,834) | (134,124) |
Retained earnings | 2,768,697 | 2,099,106 | 2,614,014 |
Total shareholders' equity | 3,039,378 | 2,335,474 | 2,889,276 |
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $7,754,510 | $6,938,867 | $7,463,977 |
Balance Sheets (Parenthetical)
Balance Sheets (Parenthetical) (USD $) | |||
In Thousands, except Share data | May. 01, 2010
| Jan. 30, 2010
| May. 02, 2009
|
ASSETS | |||
Property under capital lease, accumulated amortization | $19,916 | $19,357 | $17,682 |
SHAREHOLDERS' EQUITY | |||
Common stock, shares authorized | 1,200,000,000 | 1,200,000,000 | 1,200,000,000 |
Common stock, par value | 1 | 1 | 1 |
Common stock, shares issued | 407,979,188 | 409,386,126 | 413,533,634 |
Common stock, shares outstanding | 407,979,188 | 409,386,126 | 413,533,634 |
Statements of Cash Flows (Unaud
Statements of Cash Flows (Unaudited) (USD $) | ||
In Thousands | 3 Months Ended
May. 01, 2010 | 3 Months Ended
May. 02, 2009 |
Cash flows from operating activities: | ||
Net income | $331,434 | $209,214 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 113,613 | 104,147 |
Loss on property disposals | 1,788 | 326 |
Deferred income tax provision | 18,159 | 18,301 |
Amortization of stock compensation expense | 13,313 | 12,404 |
Excess tax benefits from stock compensation expense | (15,475) | (166) |
Changes in assets and liabilities: | ||
(Increase) in accounts receivable | (19,894) | (6,077) |
(Increase) in merchandise inventories | (79,328) | (183,812) |
Decrease in prepaid expenses and other current assets | 7,456 | 37,828 |
Increase in accounts payable | 175,234 | 267,451 |
(Decrease) in accrued expenses and other liabilities | (13,502) | (100,765) |
Other | (5,382) | 2,180 |
Net cash provided by operating activities | 527,416 | 361,031 |
Cash flows from investing activities: | ||
Property additions | (149,094) | (66,449) |
Purchase of short-term investments | (29,192) | (56,747) |
Sales and maturities of short-term investments | 39,904 | |
Proceeds from repayments on note receivable | 227 | 212 |
Net cash (used in) investing activities | (138,155) | (122,984) |
Cash flows from financing activities: | ||
Proceeds from issuance of long-term debt | 374,295 | |
Cash payments for debt issuance expenses | (3,234) | |
Payments on capital lease obligation | (571) | (528) |
Cash payments for repurchase of common stock | (230,222) | (32,424) |
Proceeds from issuance of common stock | 88,090 | 10,245 |
Excess tax benefits from stock compensation expense | 15,475 | 166 |
Cash dividends paid | (49,092) | (45,408) |
Net cash (used in) provided by financing activities | (176,320) | 303,112 |
Effect of exchange rate changes on cash | 5,722 | 17,809 |
Net increase in cash and cash equivalents | 218,663 | 558,968 |
Cash and cash equivalents at beginning of year | 1,614,607 | 453,527 |
Cash and cash equivalents at end of period | $1,833,270 | $1,012,495 |
Statement of Shareholders Equit
Statement of Shareholders Equity (Unaudited) (USD $) | |||||
In Thousands | Common Stock
| Additional Paid-In Capital
| Accumulated Other Comprehensive Income (Loss)
| Retained Earnings
| Total
|
Shares, Beginning Balance at Jan. 30, 2010 | 409,386 | ||||
Beginning Balance at Jan. 30, 2010 | $409,386 | ($134,124) | $2,614,014 | $2,889,276 | |
Comprehensive income: | |||||
Net income | 331,434 | 331,434 | |||
Foreign currency translation adjustments | (4,712) | (4,712) | |||
Recognition of prior service cost and deferred gains | 1,538 | 1,538 | |||
Total comprehensive income | 328,260 | ||||
Cash dividends declared on common stock | (61,249) | (61,249) | |||
Amortization of share-based compensation expense | 13,313 | 13,313 | |||
Issuance of common stock under stock incentive plan and related tax effect | 3,993 | 96,007 | 100,000 | ||
Issuance of common stock under stock incentive plan and related tax effect, Shares | 3,993 | ||||
Common stock repurchased | (5,400) | (109,320) | (115,502) | (230,222) | |
Common stock repurchased, Shares | (5,400) | ||||
Ending Balance at May. 01, 2010 | $407,979 | ($137,298) | $2,768,697 | $3,039,378 | |
Shares, Ending Balance at May. 01, 2010 | 407,979 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | |
3 Months Ended
May. 01, 2010 | |
Summary of Significant Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Note A. Summary of Significant Accounting Policies Basis of Presentation The consolidated interim financial statements are unaudited and, in the opinion of management, reflect all normal recurring adjustments, the use of retail statistics, and accruals and deferrals among periods required to match costs properly with the related revenue or activity, considered necessary by The TJX Companies, Inc. (together with its subsidiaries, TJX) for a fair presentation of its financial statements for the periods reported, all in conformity with accounting principles generally accepted in the United States of America (U.S. GAAP) consistently applied. The consolidated interim financial statements should be read in conjunction with the audited consolidated financial statements, including the related notes, contained in TJXs Annual Report on Form 10-K for the fiscal year ended January30, 2010 (fiscal 2010). These interim results are not necessarily indicative of results for the full fiscal year, because TJXs business, in common with the businesses of retailers generally, is subject to seasonal influences, with higher levels of sales and income generally realized in the second half of the year. Share-Based Compensation Total share-based compensation expense was $13.3million for the quarter ended May1, 2010 and $12.4million for the quarter ended May2, 2009. These amounts include stock option expense as well as restricted and deferred stock amortization. There were options to purchase 3.8million shares of common stock exercised during the first quarter ended May1, 2010. There were options to purchase 24.0million shares of common stock outstanding as of May1, 2010. Cash and Cash Equivalents TJX generally considers highly liquid investments with a maturity of three months or less at the date of purchase to be cash equivalents. Investments with maturities greater than three months but less than a year at the date of purchase are included in short-term investments. TJXs investments are primarily high-grade commercial paper, government and corporate bonds, institutional money market funds and time deposits with major banks. Merchandise Inventories TJX accrues for inventory purchase obligations at the time of shipment by the vendor. As a result, merchandise inventories on TJXs balance sheet include an accrual for in-transit inventory of $354.5million at May1, 2010, $396.8million at January30, 2010 and $317.3million at May2, 2009. A liability for a comparable amount is included in accounts payable for the respective periods. New Accounting Standards There were no new accounting standards issued during the first quarter ended May1, 2010 that are expected to have a material impact on TJXs financial condition, results of operations or cash flows. |
Commitments and Contingencies
Commitments and Contingencies | |
3 Months Ended
May. 01, 2010 | |
Commitments and Contingencies [Abstract] | |
Commitments and Contingencies | Note B. Commitments and Contingencies Provision for Computer Intrusion related costs TJX has a reserve for its estimate of the total probable losses arising from an unauthorized intrusion or intrusions (the intrusion or intrusions, collectively, the Computer Intrusion) into portions of its computer system, which was discovered late in fiscal 2007 and in which TJX believes customer data were stolen. The reserve balance was $22.5million at May1, 2010. As an estimate, the reserve is subject to uncertainty, actual costs may vary from the current estimate and such variations may be material. TJX may decrease or increase the amount of the reserve to adjust for matters such as developments in litigation, claims and related expenses, insurance proceeds and changes in the estimate. Reserve for Discontinued Operations TJX has a reserve for future obligations of discontinued operations that relates primarily to real estate leases associated with 34 discontinued A.J. Wright stores that were closed in the fourth quarter of fiscal 2007, three leases related to the sale of Bobs Stores and leases of other TJX businesses. The balance in the reserve and the activity for respective periods are presented below: Thirteen Weeks Ended May 1, May 2, In thousands 2010 2009 Balance at beginning of year $ 35,897 $ 40,564 Additions to the reserve charged to net income: Interest accretion 369 440 Cash charges against the reserve: Lease-related obligations (2,996 ) (1,320 ) Termination benefits and all other (51 ) (35 ) Balance at end of period $ 33,219 $ 39,649 TJX may also be contingently liable on up to 15 leases of BJs Wholesale Club, a former TJX business, and up to seven additional Bobs Stores leases. The reserve for discontinued operations does not reflect these leases because TJX does not believe that the likelihood of future liability to TJX is probable. |
Other Comprehensive Income
Other Comprehensive Income | |
3 Months Ended
May. 01, 2010 | |
Other Comprehensive Income [Abstract] | |
Other Comprehensive Income | Note C. Other Comprehensive Income TJXs comprehensive income information, net of related tax effects, is presented below: Thirteen Weeks Ended May 1, May 2, In thousands 2010 2009 Net income $ 331,434 $ 209,214 Other comprehensive income (loss): Foreign currency translation adjustments (4,712 ) 28,477 Recognition of unfunded post retirement obligations (1,212 ) Recognition of prior service cost and deferred gains 1,538 1,682 Total comprehensive income $ 328,260 $ 238,161 |
Capital Stock and Earnings Per
Capital Stock and Earnings Per Share | |
3 Months Ended
May. 01, 2010 | |
Capital Stock and Earnings Per Share [Abstract] | |
Capital Stock and Earnings Per Share | Note D. Capital Stock and Earnings Per Share Capital Stock During the quarter ended May1, 2010, TJX repurchased and retired 5.5million shares of its common stock at a cost of $234.1million. TJX reflects stock repurchases in its financial statements on a settlement basis. TJXs expenditures for its repurchase programs were $230.2million for the three months ended May1, 2010 and $32.4million for the three months ended May2, 2009, funded primarily by cash generated from operations. As of May1, 2010, on a trade date basis, TJX had repurchased 11.0million shares of common stock at a cost of $439.1million under a $1billion stock repurchase program authorized in September2009. All shares repurchased under the Companys stock repurchase programs during the first quarters of fiscal 2011 and fiscal 2010 were retired. In February2010, TJXs Board of Directors approved a new stock repurchase program that authorizes the repurchase of up to an additional $1billion of TJX common stock from time to time. TJX has five million shares of authorized but unissued preferred stock, $1 par value. Earnings per share The following schedule presents the calculation of basic and diluted earnings per share (EPS) for net income: Thirteen Weeks Ended May 1, May 2, In thousands, except per share data 2010 2009 Basic earnings per share Net income $ 331,434 $ 209,214 Weighted average common shares outstanding for basic EPS 408,053 412,544 Basic earnings per share continuing operations $ 0.81 $ 0.51 Diluted earnings per share Net income $ 331,434 $ 209,214 Add back: Interest expense on zero coupon convertible subordinated notes, net of income taxes 1,072 Net income used for diluted EPS calculation $ 331,434 $ 210,286 Shares for basic and diluted earnings per share calculations: Weighted average common shares outstanding for basic EPS 408,053 412,544 Assumed conversion/exercise/vesting of: Stock options and awards 6,347 4,224 Zero coupon convertible subordinated notes 15,152 Weighted average common shares outstanding for diluted EPS 414,400 431,920 Diluted earnings per share $ 0.80 $ 0.49 In April2009, TJX called for the redemption of its zero coupon convertible subordinated notes. There were 462,057 of such notes with a carrying value of $365.1million that were converted into 15.1million shares of TJX common stock at a conversion rate of 32.667 shares per note, most during the second quarter of fiscal 2010. TJX paid $2.3million to redeem the remaining 2,886 notes outstanding that were not converted. The weighted average common shares for the diluted earnings per share calculation excludes the impact of outstanding stock options if the assumed proceeds per share of the option is in excess of the related fiscal periods average price of TJXs common stock. Such options are excluded because they would have an antidilutive |
Financial Instruments
Financial Instruments | |
3 Months Ended
May. 01, 2010 | |
Financial Instruments [Abstract] | |
Financial Instruments | Note E. Financial Instruments TJX enters into financial instruments to manage its cost of borrowing and to manage its exposure to changes in fuel costs and foreign currency exchange rates. TJX recognizes all derivative instruments as either assets or liabilities in the statements of financial position and measures those instruments at fair value. 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 income or are recognized currently in earnings, along with an offsetting adjustment against the basis of the item being hedged. The fair values of the derivatives are classified as assets or liabilities, current or non-current, based upon valuation results and settlement dates of the individual contracts. Interest Rate Contracts During fiscal 2004, TJX entered into interest rate swaps with respect to $100million of the $200million ten-year notes outstanding at that time. Under these interest rate swaps, which settled in December2009, TJX paid a specific variable interest rate indexed to the six-month LIBOR rate and received a fixed rate applicable to the underlying debt, effectively converting the interest on a portion of the notes from fixed to a floating rate of interest. The interest income/expense on the swaps was accrued as earned and recorded as an adjustment to the interest expense accrued on the fixed-rate debt. The interest rate swaps were designated as fair value hedges on the underlying debt. Diesel Fuel Contracts During fiscal 2010, TJX entered into agreements to hedge a portion of its notional diesel requirements for fiscal 2011 based on the diesel fuel consumed by independent freight carriers transporting the Companys inventory. These economic hedges relate to 10% of TJXs notional diesel requirements in the second quarter of fiscal 2011 and 20% of its notional diesel requirements in the third and fourth quarters of fiscal 2011. These diesel fuel hedge agreements will settle during the last three quarters of fiscal 2011 and expire in February2011. During fiscal 2009, TJX entered into agreements to hedge approximately 30% of its notional diesel fuel requirements for fiscal 2010, which settled throughout the year and terminated in February 2010. Independent freight carriers transporting the Companys inventory charge TJX a mileage surcharge for diesel fuel price increases as incurred by the carrier. The hedge agreements are designed to mitigate the volatility of diesel fuel pricing (and the resulting per mile surcharges payable by TJX) by setting a fixed price per gallon for the year. TJX elected not to apply hedge accounting rules to these contracts. Foreign Currency Contracts TJX enters into forward foreign currency exchange contracts to obtain economic hedges on portions of firm U.S. dollar and Euro denominated merchandise purchase commitments made by T.K. Maxx (United Kingdom, Ireland, Germany and Poland), Winners (Canada) and Marmaxx. These commitmen |
Disclosures about Fair Value of
Disclosures about Fair Value of Financial Instruments | |
3 Months Ended
May. 01, 2010 | |
Disclosures about Fair Value of Financial Instruments [Abstract] | |
Disclosures about Fair Value of Financial Instruments | F. Disclosures about Fair Value of Financial Instruments Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). U.S. GAAP classifies the inputs used to measure fair value into the following hierarchy: 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. TJX endeavors to utilize the best available information in measuring fair value and classifies financial assets and liabilities in their entirety based on the lowest level of input that is significant to the fair value measurement. TJX has determined that its financial assets and liabilities are classified within level 1 or level 2 in the fair value hierarchy. The following table sets forth TJXs financial assets and liabilities that are accounted for at fair value on a recurring basis: May 1, January 30, May 2, In thousands 2010 2010 2009 Level 1 Assets: Executive savings plan $ 63,886 $ 55,404 $ 44,981 Level 2 Assets: Short-term investments $ 126,071 $ 130,636 $ 56,747 Foreign currency exchange contracts 2,714 5,642 2,390 Diesel fuel contracts 940 Interest rate swaps 2,028 Liabilities: Foreign currency exchange contracts $ 4,927 $ 1,029 $ 12,326 Diesel fuel contracts 442 4,251 The fair value of TJXs general corporate debt, including current installments, was estimated by obtaining market quotes given the trading levels of other bonds of the same general issuer type and market perceived credit quality. The fair value of the zero coupon convertible subordinated notes was estimated by obtaining market quotes. The fair value of long-term debt at May1, 2010 was $868.1million versus a carrying value of $774.3million. The fair value of the current installments of long-term debt at May2, 2009 was $800.5million versus a carrying value of $742.2 million. The fair value of long-term debt as of May2, 2009 was $386.6million versus a carrying value of $374.3million. These estimates do not necessarily reflect provisions or restrictions in the various debt agreements that might affect TJXs ability to settle these obligations. TJXs cash equivalents are stated at cost, which approximates fair value, due to the short maturities of these instruments. Investments designed to meet obligations under the executive savings plan are invested in securities traded in active markets and are recorded at unadjusted quoted pri |
Segment Information
Segment Information | |
3 Months Ended
May. 01, 2010 | |
Segment Information [Abstract] | |
Segment Information | Note G. Segment Information TJX operates five business segments, three in the United States and one each in Canada and Europe. Each of TJXs segments has its own administrative, buying and merchandising organization and distribution network. Of the U.S. based store chains, T.J. Maxx and Marshalls, referred to as Marmaxx, are managed together and reported as a single segment and A.J. Wright and HomeGoods each is reported as a separate segment. Outside the U.S., store chains in Canada (Winners and HomeSense) are under common management and reported as the TJX Canada segment, and store chains in Europe (T.K. Maxx and HomeSense) are also under common management and reported as the TJX Europe segment. TJX evaluates the performance of its segments based on segment profit or loss, which it defines as pre-tax income before general corporate expense and interest. Segment profit or loss, as defined by TJX, may not be comparable to similarly titled measures used by other entities. In addition, this measure of performance should not be considered an alternative to net income or cash flows from operating activities as an indicator of our performance or as a measure of liquidity. Presented below is financial information on TJXs business segments: Thirteen Weeks Ended May 1, May 2, In thousands 2010 2009 Net sales: U.S. segments: Marmaxx $ 3,277,864 $ 2,938,309 HomeGoods 457,059 391,895 A.J. Wright 211,379 179,394 International segments: TJX Canada 554,998 424,092 TJX Europe 515,240 420,534 $ 5,016,540 $ 4,354,224 Segment profit: U.S. segments: Marmaxx $ 468,480 $ 330,670 HomeGoods 40,593 15,573 A.J. Wright 9,786 4,413 International segments: TJX Canada 54,359 19,727 TJX Europe 5,842 9,293 579,060 379,676 General corporate expenses 32,557 33,855 Interest expense, net 10,202 6,601 Income before provision for income taxes $ 536,301 $ 339,220 |
Pension Plans and Other Retirem
Pension Plans and Other Retirement Benefits | |
3 Months Ended
May. 01, 2010 | |
Pension Plans and Other Retirement Benefits [Abstract] | |
Pension Plans and Other Retirement Benefits | Note H. Pension Plans and Other Retirement Obligations Presented below is financial information related to TJXs funded defined benefit retirement plan (funded plan) and its unfunded supplemental pension plan (unfunded plan) for the periods shown. Pension Pension (Funded Plan) (Unfunded Plan) Thirteen Weeks Ended Thirteen Weeks Ended May 1, May 2, May 1, May 2, In thousands 2010 2009 2010 2009 Service cost $ 7,750 $ 7,625 $ 206 $ 238 Interest cost 9,019 8,048 728 739 Expected return on plan assets (9,991 ) (6,500 ) Amortization of prior service cost 4 20 31 Recognized actuarial losses 2,722 3,073 694 173 Settlement cost 319 Total expense $ 9,500 $ 12,250 $ 1,648 $ 1,500 In fiscal 2009 the Pension Protection Act (PPA)became effective in the U.S., and TJXs policy is to fund, at a minimum, the amount required to maintain a funded status of 75% to 80% of the pension liability as defined by the PPA. As a result of funding in fiscal 2010, TJX does not anticipate any required funding in fiscal 2011 for the defined benefit retirement plan. TJX anticipates making contributions of $3.8million to fund current benefit and expense payments under the unfunded plan in fiscal 2011. |
Long-Term Debt and Credit Lines
Long-Term Debt and Credit Lines | |
3 Months Ended
May. 01, 2010 | |
Long-Term Debt and Credit Lines [Abstract] | |
Long-Term Debt and Credit Lines | Note I. Long-Term Debt and Credit Lines On April7, 2009, TJX issued $375million aggregate principal amount of 6.95% ten-year notes and used the proceeds from the 6.95% notes offering to repurchase additional common stock under its stock repurchase program in fiscal 2010. Also in April2009, prior to the issuance of the 6.95% notes, TJX entered into a rate-lock agreement to hedge the underlying treasury rate of those notes. The cost of this agreement is being amortized to interest expense over the term of the 6.95% notes and results in an effective fixed rate of 7.00% on those notes. On July23, 2009, TJX issued $400million aggregate principal amount of 4.20% six-year notes. TJX used a portion of the proceeds from the sale of the notes to refinance its C$235million term credit facility on August10, 2009, prior to its scheduled maturity, and used the remainder, together with funds from operations, to repay its $200million 7.45% notes due December15, 2009, at maturity. Also in July2009, prior to the issuance of the 4.20% notes, TJX entered into a rate-lock agreement to hedge the underlying treasury rate on $250million of those notes. The cost of this agreement is being amortized to interest expense over the term of the 4.20% notes and results in an effective fixed rate of 4.19% on the notes. In February2001, TJX issued $517.5million zero coupon convertible subordinated notes due in February2021 and raised gross proceeds of $347.6million. The issue price of the notes represented a yield to maturity of 2% per year. During fiscal 2010, TJX called for the redemption of these notes at the original issue price plus accrued original issue discount, and 462,057 of such notes with a carrying value of $365.1million were converted into 15.1million shares of TJX common stock at a rate of 32.667 shares per note. TJX paid $2.3million to redeem the remaining 2,886 notes outstanding that were not converted. Prior to fiscal 2010, a total of 52,557 notes were either converted into common shares of TJX or put back to TJX. As of May1, 2010, TJX had a $500million revolving credit facility maturing May2010 and a $500 million revolving credit facility maturing May2011. These agreements require the payment of six basis points annually on the committed amounts, have no compensating balance requirements, have various covenants including a requirement of a specified ratio of debt to earnings, and serve as back up to TJXs commercial paper program. There were no outstanding amounts under these credit facilities as of May1, 2010 or May2, 2009. The $500 million facility maturing in May2010 was replaced at that time with a new $500million, three-year revolving credit facility with similar terms and provisions but updated for market pricing. As of May1, 2010 and May2, 2009, TJXs foreign subsidiaries had uncommitted credit facilities. TJX Canada had two credit lines, a C$10million facility for operating expenses and a C$10million letter of credit facility. As of May1, 2010 and May 2, 2009, there were no amounts outstanding on the Canadian credit line for operating expenses. As of May1, 2010, TJX Europe had a credit line of 20 million. There were no outstanding |
Income Taxes
Income Taxes | |
3 Months Ended
May. 01, 2010 | |
Income Taxes [Abstract] | |
Income Taxes | Note J. Income Taxes TJX had unrecognized tax benefits of $125.0million as of May1, 2010 and $134.2million as of May 2, 2009. The effective income tax rate was 38.2% for the fiscal 2011 first quarter and 38.3% for last years first quarter. TJX is subject to U.S. federal income tax as well as income tax in multiple state, local and foreign jurisdictions. In nearly all jurisdictions, the tax years through fiscal 2001 are no longer subject to examination. TJXs accounting policy classifies interest and penalties related to income tax matters as part of income tax expense. The accrued amounts for interest and penalties were $53.1million as of May1, 2010 and $56.0million as of May2, 2009. Based on the outcome of tax examinations or judicial or administrative proceedings, or as a result of the expiration of statute of limitations in specific jurisdictions, it is reasonably possible that unrecognized tax benefits for certain tax positions taken on previously filed tax returns may change materially from those presented in the financial statements. During the next 12months, it is reasonably possible that tax examinations of prior years tax returns or judicial or administrative proceedings, that reflect such positions taken by TJX, may be finalized. As a result, the total net amount of unrecognized tax benefits may decrease, which would reduce the provision for taxes on earnings by a range of $1.0million to $49.0million. |