10-QPeriod: Q1 FY2024

TJX COMPANIES INC /DE/ Quarterly Report for Q1 Ended Apr 29, 2023

Filed May 26, 2023For Securities:TJX

Summary

TJX Companies, Inc. reported solid results for the first quarter of fiscal year 2024, with net sales increasing by 3% to $11.8 billion and diluted earnings per share rising to $0.76, up from $0.49 in the prior year period. This growth was driven by a 3% increase in comparable store sales, indicating healthy customer traffic. The company also demonstrated effective cost management, with a 1.0 percentage point decrease in the cost of sales ratio and a focus on improving merchandise margins. Financially, TJX continues to prioritize shareholder returns, repurchasing over $0.8 billion in stock and paying dividends during the quarter, underscoring its commitment to capital allocation. The company ended the quarter with a strong liquidity position, holding $5 billion in cash and cash equivalents, and has ample borrowing capacity available. Management anticipates capital spending for the full fiscal year to be between $1.7 billion and $1.9 billion, to be funded by existing cash and internally generated funds.

Financial Highlights

47 data points
Beta

Revenue

$11.78B

28.9% Gross Margin

Net Income

$891.00M

7.6% Net Margin

EPS (Diluted)

$0.76

Total Assets

$28.68B

Cash & Equivalents

$5.03B

Free Cash Flow

$384.00M

Financial Statements
Beta
Revenue$11.78B
Cost of Revenue$8.37B
Gross Profit$3.41B
SG&A Expenses$2.24B
Net Income$891.00M
EPS (Basic)$0.77
EPS (Diluted)$0.76
Shares Outstanding (Basic)1.15B
Shares Outstanding (Diluted)1.17B

Key Highlights

  • 1Net sales increased 3% year-over-year to $11.8 billion.
  • 2Diluted earnings per share (EPS) rose to $0.76 from $0.49 in the prior year.
  • 3Comparable store sales increased by 3%, driven by customer traffic.
  • 4Cost of sales as a percentage of net sales improved by 1.0 percentage point to 71.1%.
  • 5The company returned over $0.8 billion to shareholders through share repurchases and dividends.
  • 6Inventory levels decreased by 5% on a reported basis.
  • 7TJX maintained a strong liquidity position with $5.0 billion in cash and cash equivalents.

Frequently Asked Questions

The primary driver of the 3% increase in net sales to $11.8 billion was a 3% increase in comparable store sales, which reflects improved customer traffic. This was partially offset by a negative impact from foreign currency exchange rates.

TJX improved its cost of sales ratio by 1.0 percentage point to 71.1% due to higher merchandise margins, favorable freight costs, and higher markon, partially offset by increased shrink accrual rates. Selling, general, and administrative (SG&A) expenses as a percentage of net sales increased slightly by 0.6 percentage points to 19.0% due to higher administrative costs and payroll expenses.

TJX demonstrated a strong commitment to shareholder returns by repurchasing over $0.8 billion of its stock and paying dividends during the quarter. The company has approximately $3 billion available under its existing stock repurchase programs as of April 29, 2023, and plans to repurchase $2 billion to $2.5 billion in fiscal year 2024.

TJX ended the quarter with a robust cash position of $5.0 billion. The company has $1.5 billion available under its credit facilities and believes its current resources are adequate for operating needs. For the full fiscal year 2024, TJX anticipates capital expenditures between $1.7 billion and $1.9 billion, which will be funded by existing cash and internally generated funds.