Better than expected second quarter sales and profits at TJX Companies prompted CEO Carol Meyrowitz to strike an optimistic tone about the discount retailer’s future prospects.
The nation’s leading off-price retailer of apparel and home fashions said sales for the second quarter ended August 2 increased 7% to $6.9 billion and same store sales grew 3% on top of a prior year increase of 4%. Net income for the quarter was $518 million, or 73 cents a share, compared to $480 million, or 66 cents a share, the prior year. The sales were at the high end of the company’s plan and the earnings per share figure exceeded plan.
“Our customer traffic gained momentum throughout the quarter, and was positive in July. Further, we are pleased with our solid merchandise margins as well as the improved performance of our apparel businesses,” Meyrowitz said. “We are now raising our full year adjusted earnings per share guidance to reflect our above-plan second quarter results.”
In the third quarter, Meyrowitz said the company expects same store sales growth of 1% to 2% and earnings per share to range from 81 cents to 85 cents compared to a prior year figure of 75 cents adjusted to excluded an 11 cent a share non-recurring tax benefit. For the full year, the company expects same store sales growth of 1% to 2% and expects to earn between $3.10 and $3.18 a share on an adjusted basis compared to $2.83 the prior year.
“The third quarter is off to a solid start and we are excited about our opportunities for the second half of the year,” Meyrowitz said. “We entered the third quarter in an excellent inventory position and see plentiful opportunities for great brands in the marketplace. We are raising the bar on our marketing campaigns and gift-giving initiatives, which I believe are going to be even better than last year, and above all, we will be bringing consumers amazing values.”
Meyrowitz added that she is confident in the company’s ability to deliver another strong year as it continues on a path to exceeding annual sales of $40 billion. TJX ended last year with sales of $27.4 billion.
The company ended the recent quarter with a total of 3,279 stores, consisting of 1,090 T.J. Maxx stores, 956 Marshalls stores, 464 HomeGoods stores and four Sierra Trading Post stores in the U.S., and 354 stores in Canada and 410 stores in Europe.