Exhibit 99.1
The TJX Companies, Inc. Reports 50% Increase in
First Quarter EPS For Fiscal 2005
FRAMINGHAM, Mass.--(BUSINESS WIRE)--May 18, 2004--The TJX
Companies, Inc. (NYSE: TJX), the leading off-price retailer of apparel
and home fashions in the U.S. and worldwide, today announced strong
sales and earnings results for the first quarter ended May 1, 2004.
Diluted earnings per share increased 50% to $.33 in the first quarter,
over $.22 per share in the prior year. Net income was $168 million, a
48% increase over the $114 million earned last year. Net sales for the
first quarter were $3.4 billion, a 20% increase over last year, and
consolidated comparable store sales increased 8% over the prior year.
Edmond English, President and Chief Executive Officer of The TJX
Companies, Inc., commented, "We are extremely pleased with our strong
first quarter performance, as we achieved top- and bottom-line results
that were even greater than the significant year-over-year increases
we had planned. We saw great customer response to fresh, spring
women's apparel, and continued benefit from our strategy of buying
close to need, which helped drive strong comparable store sales and
merchandise margins. This, along with disciplined expense management,
led to significant bottom-line margin expansion. As we enter the
second quarter, our inventories are in great shape, and we are
well-positioned to take advantage of the numerous in-season buying
opportunities in the marketplace.
"At The Marmaxx Group, the combination of T.J. Maxx and Marshalls,
we planned for substantial increases in the first quarter over weaker
results last year, when the weather in many areas of the U.S. was
unusually harsh. We are very pleased that this division significantly
exceeded these expectations. Segment profit increased 40% to $272
million, well above our plan, and segment profit margin reached 11.2%,
also well ahead of expectations. Total sales for the first quarter
reached $2.4 billion, and comparable store sales increased 6%. Our
strong results were primarily due to Marmaxx's successful execution of
its inventory and merchandising strategies. Additionally, although
still early, we are encouraged by the enthusiastic customer response
to our footwear, accessories and jewelry department expansions."
English continued, "At HomeGoods, sales increased 28% and
comparable store sales increased 4%. Segment profit increased 14%
above last year to $5 million. HomeGoods' first quarter results were
impacted by a weak comp store sales performance in April, which was
driven by our lighter-than-optimal summer, seasonal inventories, which
were in high demand. That said, despite the shortfall in sales, we are
pleased with HomeGoods' first quarter growth and continue to be very
excited about this unique concept, which offers great values on a
rapidly changing assortment of home fashions.
"We are also pleased that sales for our Canadian divisions,
Winners and HomeSense, increased 34% above last year and comparable
store sales increased 18% in U.S. dollars, including the benefit of
the currency exchange rate. Comparable store sales increased 6% over
the prior year in local currency, which we believe more closely
reflects our operating performance. Winners' segment profit increased
107% to $24 million, well ahead of our expectations. These strong
results were primarily due to this division's solid execution of its
merchandising strategy and, to a lesser extent, the favorable impact
of foreign exchange rates. In addition, we are pleased that our
HomeSense concept continues to take hold in Canada, as this young
division expands its business.
"At T.K. Maxx, in the U.K. and Ireland, sales increased 49% and
comparable store sales increased 21% in U.S. dollars, reflecting the
favorable effect of the currency exchange rate. In local currency,
T.K. Maxx's comparable store sales increased 5% over a strong 8%
increase the prior year, when weather patterns were extremely
favorable. Segment profit increased to $2 million, reflecting the
favorable impact of the currency exchange rate. We remain very pleased
with the growth of our T.K. Maxx concept, as this division continues
to expand in the U.K. and Ireland."
English continued, "A.J. Wright posted a 34% increase in sales in
the first quarter and a comparable store sales gain of 9%. Bottom-line
results for this young division were just shy of our expectations.
During the quarter, A.J. Wright opened its 100th store, reaching that
mark faster than any other division in TJX history. We are excited
about the growth potential for this concept, as it continues to
resonate with moderate-income shoppers, which represent a huge
customer demographic.
"Bob's Stores' first quarter results were in line with our
expectations. This business, which we acquired in December 2003, has
made significant improvements in its inventory management and flow
practices, resulting in a fresher merchandise assortment in our
stores. Our plan is to grow this business slowly and deliberately at
first, as we refine the concept. Over the long term, we are excited by
what we see as our opportunity to expand this value-oriented, branded
apparel concept to 400 stores in the U.S.
"We continue to generate significant returns on investment, which
gives us the ability to grow our store base and the infrastructure to
support it, while simultaneously pursuing our sizable share repurchase
program and maintaining our strong financial position. During the
first quarter, we spent a total of $137 million, retiring 5.6 million
shares of TJX stock."
English concluded, "We had planned to achieve significant
increases in the first quarter, and I am delighted that we delivered
results above our expectations. Following our very strong beginning to
the year, we enter the second quarter with inventories in terrific
shape, ready to capitalize upon the abundance of buying opportunities
in the marketplace and continue to offer our customers great fashion
at exciting values."
The TJX Companies, Inc. is the leading off-price retailer of
apparel and home fashions in the U.S. and worldwide. The Company
operates 753 T.J. Maxx, 679 Marshalls, 185 HomeGoods, and 102 A.J.
Wright stores, as well as 31 Bob's Stores, in the United States. In
Canada, the Company operates 162 Winners and 31 HomeSense stores, and
in Europe, 148 T.K. Maxx stores. TJX's press releases and financial
information are also available on the Internet at www.tjx.com.
At 11:00 a.m. EDT today, Edmond English, President and Chief
Executive Officer of The TJX Companies, Inc., will hold a conference
call with stock analysts to discuss the Company's fiscal 2005 first
quarter results, operations and business trends. The call will be
webcast simultaneously at www.tjx.com. A replay of the call will also
be available by dialing (800) 216-3058 through Tuesday, May 25, 2004.
Additionally, TJX expects to release its May 2004 sales results on
Thursday, June 3, 2004, at approximately 8:15 a.m. EDT. Concurrent
with the press release, a recorded message with more detailed
information regarding TJX's May sales results, operations and business
trends will be available by calling (703) 736-7248 or via the Internet
at www.tjx.com. That sales recording will remain available via the
phone through Thursday, June 10, 2004. Archived versions of our
recorded messages and conference calls are available at www.tjx.com
after they are no longer available by telephone.
SAFE HARBOR STATEMENTS UNDER THE PRIVATE SECURITIES LITIGATION
REFORM ACT OF 1995: Various statements made in this release are
forward-looking and involve a number of risks and uncertainties. All
statements that address activities, events or developments that we
intend, expect or believe may occur in the future are forward-looking
statements. The following are some of the factors that could cause
actual results to differ materially from the forward-looking
statements: our ability to continue successful expansion of our store
base; risks of expansion; our ability to successfully implement our
opportunistic inventory strategies and to effectively manage our
inventories; consumer confidence, demand, spending habits and buying
preferences; effects of unseasonable weather; competitive factors;
factors affecting availability of store and distribution center
locations on suitable terms; factors affecting our recruitment and
employment of associates; factors affecting expenses; success of our
acquisition and divestiture activities; our ability to successfully
implement technologies and systems; our ability to continue to
generate adequate cash flows; general economic conditions; potential
disruptions due to wars, natural disasters and other events beyond our
control; changes in currency and exchange rates; import risks; adverse
outcomes for any significant litigation; changes in laws and
regulations and accounting rules and principles; and other factors
that may be described in our filings 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.
THE TJX COMPANIES, INC. AND CONSOLIDATED SUBSIDIARIES
FINANCIAL SUMMARY
(Unaudited)
(Dollars In Thousands Except Per Share Amounts)
13 Weeks Ended
May 1, April 26,
2004 2003
Net sales $ 3,352,737 $ 2,788,705
Cost of sales, including buying and
occupancy costs 2,518,346 2,113,630
Selling, general and administrative
expenses 553,474 482,891
Interest expense, net 6,583 6,978
Income before provision for income taxes 274,334 185,206
Provision for income taxes 106,222 71,675
Net income $ 168,112 $ 113,531
Diluted earnings per share:
Net income $ .33 $ .22
Cash dividends declared per share $ .045 $ .035
Weighted average shares for diluted
earnings per share computation 504,680,698 520,504,200
THE TJX COMPANIES, INC. AND CONSOLIDATED SUBSIDIARIES
CONDENSED BALANCE SHEETS
(Unaudited)
(In Millions)
May 1, April 26,
2004 2003
ASSETS
Current assets:
Cash and cash equivalents $ 241.5 $ 171.5
Accounts receivable and other current
assets 323.6 235.7
Current deferred income taxes, net 7.6 10.1
Merchandise inventories 2,010.2 1,882.6
Total current assets 2,582.9 2,299.9
Property and capital leases, net of
depreciation 1,626.9 1,439.3
Other assets 115.3 111.5
Goodwill and tradename, net of
amortization 183.6 179.3
TOTAL ASSETS $4,508.7 $4,030.0
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current installments of long-term debt $ 5.0 $ 15.0
Accounts payable 1,084.0 997.9
Accrued expenses and other current
liabilities 663.5 604.2
Total current liabilities 1,752.5 1,617.1
Other long-term liabilities 369.4 321.0
Non-current deferred income taxes, net 136.9 56.0
Long-term debt 664.4 666.8
Shareholders' equity 1,585.5 1,369.1
TOTAL LIABILITIES AND SHAREHOLDERS'
EQUITY $4,508.7 $4,030.0
THE TJX COMPANIES, INC. AND CONSOLIDATED SUBSIDIARIES
CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
(In Millions)
13 Weeks Ended
May 1, April 26,
2004 2003
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 168.1 $ 113.5
Depreciation and amortization 67.4 55.6
Deferred income tax provision 18.7 16.4
(Increase) in accounts receivable and other
current assets (64.6) (58.7)
(Increase) in merchandise inventories (78.9) (316.9)
Increase in accounts payable 128.7 178.9
(Decrease) in accrued expenses and other
liabilities (56.9) (69.7)
Other, net 10.8 10.5
Net cash provided by (used in) operating activities 193.3 (70.4)
CASH FLOWS FROM INVESTING ACTIVITIES:
Property additions (62.9) (87.3)
Other .2 .2
Net cash (used in) investing activities (62.7) (87.1)
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments for repurchase of common stock (133.8) (149.5)
Cash dividends paid (17.5) (15.6)
Other 18.1 1.9
Net cash (used in) financing activities (133.2) (163.2)
Effect of exchange rate changes on cash (2.3) (.1)
Net (decrease) in cash and cash equivalents (4.9) (320.8)
Cash and cash equivalents at beginning of year 246.4 492.3
Cash and cash equivalents at end of period $ 241.5 $ 171.5
THE TJX COMPANIES, INC. AND CONSOLIDATED SUBSIDIARIES
SELECTED INFORMATION BY MAJOR BUSINESS SEGMENT
(Unaudited)
(Dollars In Thousands)
13 Weeks Ended
May 1, April 26,
2004 2003
Net sales:
Marmaxx $2,421,224 $2,150,086
Winners (a) 269,625 201,783
T.K. Maxx 263,247 177,253
HomeGoods 226,432 177,062
A.J. Wright 110,846 82,521
Bob's Stores 61,363 -
$3,352,737 $2,788,705
Segment profit or (loss):
Marmaxx $ 271,914 $ 193,885
Winners (a) 24,393 11,793
T.K. Maxx 1,943 916
HomeGoods 5,161 4,532
A.J. Wright (2,953) (2,345)
Bob's Stores 1,250 -
301,708 208,781
General corporate expense 20,791 16,597
Interest expense, net 6,583 6,978
Income before provision for income taxes $ 274,334 $ 185,206
Stores in operation end of period:
T.J. Maxx 753 719
Marshalls 679 639
Winners 162 154
HomeGoods 185 146
T.K. Maxx 148 123
A.J. Wright 102 83
HomeSense 31 19
Bob's Stores 31 -
Total 2,091 1,883
(a) Includes the operating results of HomeSense stores.
The TJX Companies, Inc. and Consolidated Subsidiaries
Notes To Consolidated Condensed Financial Statements
1. During the first quarter ended May 1, 2004, TJX repurchased 5.6
million shares of its common stock, for a cost of $137.1 million.
Through May 1, 2004, under its current $1 billion multi-year stock
repurchase program, TJX has repurchased 48.6 million shares at a
cost of $955.8 million.
2. Certain amounts in the prior period's financial statements have
been reclassified to be consistent with the current year's
presentation.
CONTACT: The TJX Companies, Inc.
Sherry Lang, Vice President
Investor and Public Relations
(508) 390-2323