Home Home Operations Lead TJX to Strong Q2
August 19, 2021
Home Operations Lead TJX to Strong Q2
Posted In: Retail Articles

By Mike Duff

Contributing Editor

The TJX Cos. continued their comeback in the second quarter, gaining traction as it emerges from a period of store closures due to the COVID-19 pandemic, with HomeGoods making an especially strong contribution.

Net income was $785.7 million, or 64 cents per diluted share, the company stated, versus a net loss of $214.2 million, or 18 cents per diluted share, in the fiscal year previous.

TJX beat a Yahoo Finance-published analyst average estimate for earnings per diluted share of 57 cents.

Second-quarter diluted earnings per share included a debt extinguishment charge of 15 cents per share, versus 62 cents per share in the second quarter two years past, included as a comparison that mitigates the impact of pandemic related store closures. TJX  estimates that temporary store closures for about 3% of the second quarter negatively impacted earnings per share by five cents to seven cents.

Also ahead of Wall Street estimates, by about a billion bucks on average, net sales were up 81% to $12.1 billion versus the year-earlier second quarter in which stores were closed for approximately 31% of the period due to the global coronavirus pandemic, TJX noted. The company added that, versus the second quarter two years prior, sales in the latest completed period increased 23%. Overall, open-only comp-store sales gained 20% versus the quarter two years before. By division, on an open-only basis, comps at Marmaxx, including T.J. Maxx and Marshalls, gained 18%, HomeGoods gained 36%, TJX Canada gained 18% and TJX International gained 12%. Open only comps cover days stores were in operation and don’t include e-commerce revenues, and, where relevant, are on a constant-currency basis.

Scott Goldenberg, TJX CFO, said in a conference call that the HomeGoods division demonstrated consistent strength across all major categories and geographic regions in its namesake and HomeSense operations.

 

The performance of our home businesses across all of our divisions continued to be phenomenal, and apparel continued to trend higher, with open-only comp sales increasing low-teens for the quarter. Our U.S. and international divisions delivered outstanding double-digit open-only comp-store sales increases, as our exciting and eclectic mix of merchandise, great brands and values, and treasure-hunt shopping experience continued to draw customers into our stores around the world.

-Ernie Herrman, TJX President and CEO

When looking at home products at the Marmaxx and HomeGoods divisions combined versus the second quarter two years past, total open-only comp sales in the United States increased 21% and profit dollars gained 22%, he said.

In announcing the financial results, Ernie Herrman, TJX president and CEO, said, “I am especially pleased with the sequential improvement to our pretax margin compared to the first quarter. The performance of our home businesses across all of our divisions continued to be phenomenal, and apparel continued to trend higher, with open-only comp sales increasing low-teens for the quarter. Our U.S. and international divisions delivered outstanding double-digit open-only comp-store sales increases, as our exciting and eclectic mix of merchandise, great brands and values, and treasure-hunt shopping experience continued to draw customers into our stores around the world.

“I want to recognize the extraordinary work and dedication of our global associates across the organization, especially our store and distribution center associates who are physically coming into work to bring great value to our customers. Sales are very strong as we start the third quarter, with overall open-only comp-store sales up mid-teens. While the environment remains uncertain, particularly with the Delta variant, we are convinced that TJX is in a position of strength. We see numerous opportunities to continue to gain market share and improve our profitability in the medium to longer term. We are confident in our ability to reach our long-term strategic vision of TJX becoming a $60 billion company.”

Pin It on Pinterest