For the fiscal 2002 fourth quarter, sales were $3.2 billion, up 17% over last year. Consolidated comparable store sales increased by 6%. Net income was $155 million and diluted earnings per share were $.56, a 17% increase over the prior year.
Edmond English, President and Chief Executive Officer of The TJX Companies, Inc. commented, "The tragedies of September 11, coupled with a downturn in consumer confidence and a slumping economy, made 2001 a very difficult year for everyone. As I reflect upon our performance in this difficult environment, I am very proud of our accomplishments. We successfully added a net of 172 stores company-wide and, with a very strong fourth quarter performance, we were able to achieve our sales goal for the year, while posting 4% growth in earnings per share. Although our earnings growth is below our original expectations, I am very pleased with our strong finish in 2001, despite our previously announced higher than anticipated inventory shortage. We enter the new year with great momentum. I attribute much of our continued success to the fact that our business is considerably more nimble than most other retail operations which enables us to adapt quickly to changes in the retail environment. Because we buy opportunistically, we are able to take full advantage of the opportunities in the market and compete very effectively in highly promotional retail environments.
"At The Marmaxx Group, the internal combination of T.J. Maxx and Marshalls, comparable store sales were up 6%, which was above plan, and strong merchandise margins led to a 23% increase in fourth quarter operating profits. The key driver of these results was our liquid inventory position which led to strong merchandise margins. For the year, comparable store sales were up 3%, in line with our objectives, and operating profit increased 4% to $894 million or slightly over 10% of sales. We netted 73 new stores in 2001 to end the year with 1,269 stores. Our plans are to increase store count for The Marmaxx Group by 75 stores in 2002.
"At Winners in Canada, fourth quarter comparable store sales in local currency rose 15% and operating profits increased 13%. For the year, we posted a slightly above-plan 6% comparable store sales gain and earned $59 million in operating profits, which was below last year's record results. While inventory liquidity was a challenge for Winners during much of 2001, inventories are in great shape as we enter 2002. We added 14 new Winners stores in 2001. Further, the Winners organization did an excellent job in launching HomeSense, the Canadian version of HomeGoods, which is a great success and significantly outperformed our expectations. In 2002, we expect to add 14 Winners stores to its year-end base of 131 and 8 HomeSense stores to its base of 7."
English continued, "HomeGoods' fourth quarter operating profits more than doubled and comparable store sales increased 11%. For the year, comparable store sales increased by an on-plan 7%. Operating profits in 2001 were $4 million, slightly below the previous year because of higher than expected markdown activity stemming in part from HomeGoods' over-inventory position early in the year. Our superstores, which couple HomeGoods with T.J. Maxx or Marshalls, continued to perform extremely well in 2001. We opened a total of 31 HomeGoods stores during the year and we will proceed with the rollout of both the freestanding and superstore formats in 2002. We plan to increase our HomeGoods year-end store base of 112 by a net of 32 stores, a 29% increase. We continue to receive excellent customer response to the HomeGoods concept which reinforces our confidence in this business.
"T.K. Maxx, in the UK and Ireland, recorded fourth quarter and full year comparable store sales increases of 5% in local currency. Although this division earned $13 million in operating profits for the year, these operating profits came in below our objectives, largely due to excess inventories. That said, inventories entering the new year are in good shape and we see significant growth and profit opportunities for this division. Our new stores are performing very well as our customer base broadens. T.K. Maxx increased its store base by 27 during the year to end the year with 101 stores. We plan to open 25 new T.K. Maxx stores in 2002, which will increase its store base by 25%.
"A.J. Wright had a very good year, with its store base increasing by 20 stores to end 2001 with 45, an 80% increase over last year. Comparable store sales increased by 17% in the fourth quarter and 18% for the year, both of which exceeded our objectives. A.J. Wright continues to gain traction and we are excited with our opportunity to bring the off-price concept to the wide demographic represented by the moderate-income customer. A.J. Wright plans to add 30 stores in 2002, a 67% increase in its store base.
"Our strong financial position continues to give us great confidence in today's difficult economic and retail environment. Our continued sizable excess cash flow has enabled us to fund our ongoing aggressive share buyback program. During the fourth quarter, we spent $89 million on share repurchases and retired 2.3 million shares. During the past year, we spent $424 million, retiring 13.2 million shares. In 2002, we expect to continue our significant buyback program with the spending of an additional $400 million."
English concluded, "As we enter 2002, customer traffic continues to gain momentum, our inventory position is very liquid across all divisions and there are great buying opportunities in the marketplace. With the ongoing strong customer response to our off-price values and the success of our store opening program, we are very upbeat about our prospects in the year ahead."
The TJX Companies, Inc. is the leading off-price retailer of apparel and home fashions in the U.S. and worldwide. The Company operates 687 T.J. Maxx stores, 582 Marshalls, 112 HomeGoods and 45 A.J. Wright stores in the United States. In Canada, the Company operates 131 Winners and 7 HomeSense stores, and in Europe, 101 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. EST today, Edmond English, President and Chief Executive Officer of The TJX Companies, will hold a conference call with stock analysts to discuss the Company's fiscal 2002 year-end results and expectations for fiscal 2003. A real-time webcast of the call will be available at www.tjx.com through March 6, 2002. A replay of the call will also be available by dialing 888-562-6153 through March 6, 2002. Additionally, TJX will release its February 2002 sales results on March 7, 2002 at approximately 8:15 a.m. EST. Concurrent with the press release, a recorded message with more detailed information will be available by calling 703-736-7248 or via www.tjx.com. That recording will remain available via the phone and the Internet through March 14, 2002.
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995: Certain statements contained in this report are forward-looking and involve a number of risks and uncertainties. Among the factors that could cause actual results to differ materially are the following: general economic conditions including affects of terrorist incidents and military actions and consumer demand and preferences; weather patterns in areas where we have concentrations of stores; competitive factors, including pressure from pricing and promotional activities of competitors; the impact of excess retail capacity and the availability of desirable store and distribution center locations on suitable terms; recruiting quality sales associates; the availability, selection and purchasing of attractive merchandise on favorable terms; potential disruptions in supply and duties, tariffs and quotas on imported merchandise, as well as economic and political problems in countries from which merchandise is imported; currency and exchange rate factors in our foreign operations; expansion of our store base, development of new businesses and application of our off-price strategies in foreign countries; our acquisition and divestiture activities; our ultimate liability with respect to leases relating to discontinued operations including indemnification and other factors affecting or mitigating our liability; and other factors that are or may be described in the Company's 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 therein will not be realized.
THE TJX COMPANIES, INC. AND CONSOLIDATED SUBSIDIARIES
FINANCIAL SUMMARY
(Unaudited)
(Dollars In Thousands Except Per Share Amounts)
13 Weeks Ended
Jan. 26, Jan. 27,
2002 2001
Net sales $ 3,208,712 $ 2,751,305
Cost of sales, including
buying and occupancy costs 2,481,606 2,124,038
Selling, general and
administrative expenses 467,955 414,939
Interest expense, net 7,202 5,698
Income from continuing operations before
provision for income taxes 251,949 206,630
Provision for income taxes 96,629 71,451
Income from continuing operations 155,320 135,179
Loss related to discontinued
operations, net of income taxes -- --
Net Income $ 155,320 $ 135,179
Diluted earnings per share:
Income from continuing operations $ .56 $ .48
Net income $ .56 $ .48
Cash dividends declared per share $ .045 $ .04
Weighted average shares for diluted
earnings per share computation 275,306,275 282,515,324
THE TJX COMPANIES, INC. AND CONSOLIDATED SUBSIDIARIES
FINANCIAL SUMMARY
(Unaudited)
(Dollars In Thousands Except Per Share Amounts)
52 Weeks Ended
Jan. 26, Jan. 27,
2002 2001
Net sales $ 10,708,998 $ 9,579,006
Cost of sales, including
buying and occupancy costs 8,122,922 7,188,124
Selling, general and
administrative expenses 1,686,389 1,503,036
Interest expense, net 25,643 22,904
Income from continuing operations
before provision for income taxes 874,044 864,942
Provision for income taxes 333,647 326,876
Income from continuing operations 540,397 538,066
Loss related to discontinued
operations, net of income taxes (40,000) --
Net Income $ 500,397 $ 538,066
Diluted earnings per share:
Income from continuing operations $ 1.94 $ 1.86
Net income $ 1.80 $ 1.86
Cash dividends declared per share $ .18 $ .16
Weighted average shares for diluted
earnings per share computation 278,133,862 289,196,228
THE TJX COMPANIES, INC. AND CONSOLIDATED SUBSIDIARIES
CONDENSED BALANCE SHEETS
(Unaudited)
(In Millions)
Jan. 26, Jan. 27,
2002 2001
ASSETS
Current assets:
Cash and cash equivalents $ 492.8 $ 132.5
Accounts receivable and
other current assets 166.1 180.5
Merchandise inventories 1,457.0 1,452.9
Total current assets 2,115.9 1,765.9
Property and capital leases,
net of depreciation 1,191.0 908.0
Other assets 83.1 70.0
Non-current deferred income taxes, net 26.6 3.4
Goodwill and tradename,
net of amortization 179.1 185.0
TOTAL ASSETS $ 3,595.7 $ 2,932.3
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Short-term debt $ -- $ 39.0
Accounts payable 761.5 645.7
Accrued expenses and other
current liabilities 511.5 501.9
Income taxes payable 42.0 42.2
Total current liabilities 1,315.0 1,228.8
Other long-term liabilities 268.0 165.4
Long-term debt 672.0 319.4
Shareholders' equity 1,340.7 1,218.7
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY $ 3,595.7 $ 2,932.3
THE TJX COMPANIES, INC. AND CONSOLIDATED SUBSIDIARIES
CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
(In Millions)
52 Weeks Ended
Jan. 26, Jan. 27,
2002 2001
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 500.4 $ 538.1
Loss relating to discontinued
operations 40.0 --
Depreciation and amortization 204.1 175.8
Deferred income tax provision
(benefit) 35.2 (24.2)
(Increase) in accounts receivable
and other current assets (8.9) (18.6)
(Increase) in merchandise inventories (13.3) (232.0)
Increase in accounts payable 120.8 34.1
Increase in accrued expenses and
other liabilities 16.1 69.7
Other, net 18.0 13.8
Net cash provided by operating
activities 912.4 556.7
CASH FLOWS FROM INVESTING ACTIVITIES:
Property additions (449.4) (257.0)
Other (5.4) (13.9)
Net cash (used in) investing activities (454.8) (270.9)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from borrowings of
short-term debt, net -- 39.0
Proceeds from borrowings of
long-term debt 347.6 --
Payments on short-term debt
outstanding from prior year (39.0) --
Principal payments on long-term debt (.1) (100.2)
Payments for repurchase of
common stock (424.2) (444.1)
Cash dividends paid (48.3) (44.7)
Other 64.3 26.1
Net cash (used in) financing activities (99.7) (523.9)
Effect of exchange rate changes on cash 2.4 (1.2)
Net increase (decrease) in cash
and cash equivalents 360.3 (239.3)
Cash and cash equivalents at
beginning of year 132.5 371.8
Cash and cash equivalents at end of year $ 492.8 $ 132.5
THE TJX COMPANIES, INC. AND CONSOLIDATED SUBSIDIARIES
SELECTED INFORMATION BY MAJOR BUSINESS SEGMENT
(Unaudited)
(In Thousands)
13 Weeks Ended
Jan. 26, Jan. 27,
2002 2001
Net sales:
Marmaxx $ 2,593,863 $ 2,319,339
Winners (a) 196,996 153,894
T.K. Maxx 186,711 134,837
HomeGoods 171,375 111,690
A.J. Wright 59,767 31,545
$ 3,208,712 $ 2,751,305
Operating income (loss):
Marmaxx $ 247,064 $ 200,108
Winners (a) 18,710 16,486
T.K. Maxx 6,564 6,184
HomeGoods 6,102 2,846
A.J. Wright (1,660) (3,463)
276,780 222,161
General corporate expense 16,977 9,181
Goodwill amortization 652 652
Interest expense, net 7,202 5,698
Income from continuing operations
before provision for income taxes $ 251,949 $ 206,630
Stores in operation end of period:
T.J. Maxx 687 661
Marshalls 582 535
Winners 131 117
T.K. Maxx 101 74
HomeGoods 112 81
A.J. Wright 45 25
HomeSense 7 --
Total 1,665 1,493
(a) Includes the operating results of the new HomeSense stores.
THE TJX COMPANIES, INC. AND CONSOLIDATED SUBSIDIARIES
SELECTED INFORMATION BY MAJOR BUSINESS SEGMENT
(Unaudited)
(In Thousands)
52 Weeks Ended
Jan. 26, Jan. 27,
2002 2001
Net sales:
Marmaxx $ 8,863,053 $ 8,228,468
Winners (a) 660,877 563,311
T.K. Maxx 520,529 389,062
HomeGoods 507,211 315,015
A.J. Wright 157,328 83,150
$ 10,708,998 $ 9,579,006
Operating income (loss):
Marmaxx $ 893,650 $ 858,358
Winners (a) 59,140 71,055
T.K. Maxx 12,972 10,867
HomeGoods 3,710 4,700
A.J. Wright (11,843) (15,012)
957,629 929,968
General corporate expense 55,335 39,513
Goodwill amortization 2,607 2,609
Interest expense, net 25,643 22,904
Income from continuing operations
before provision for income taxes $ 874,044 $ 864,942
Stores in operation end of period:
T.J. Maxx 687 661
Marshalls 582 535
Winners 131 117
T.K. Maxx 101 74
HomeGoods 112 81
A.J. Wright 45 25
HomeSense 7 --
Total 1,665 1,493
(a) Includes the operating results of the new HomeSense stores.
The TJX Companies, Inc. Notes To Consolidated
and Consolidated Subsidiaries Condensed Financial Statements
1. During the fourth quarter ended January 26, 2002, TJX repurchased
2.3 million shares of its common stock, under its $1 billion stock
repurchase program, at a cost of $88.9 million. During the fiscal
year ended January 26, 2002, TJX repurchased 13.2 million shares
at a cost of $424.2 million. Since the inception of the $1 billion
stock repurchase program, TJX has repurchased 32.7 million shares
at a cost of $805.8 million.
2. On February 13, 2001 TJX issued $517.5 million zero coupon
convertible subordinated notes due February 2021 and raised gross
proceeds of $347.6 million. The issue price of the notes
represents a yield to maturity of 2% per year. The notes are
convertible into 8.5 million shares of common stock if specified
conditions are met. The holders of the notes have the right to
require TJX to purchase the notes at the end of the first, third,
sixth and twelfth year following the issuance date. At the first
anniversary date of February 13, 2002, no holders exercised this
option. TJX used the proceeds to fund an accelerated store
roll-out program, investment in its distribution network, its
common stock repurchase program and for general corporate
purposes.
3. On November 7, 2001, a former division of TJX, House2Home, Inc.
filed for protection under Chapter 11 of the Federal Bankruptcy
Code. This division (formerly known as HomeClub and HomeBase) was
spun off by TJX, along with BJ's Wholesale Club in 1989. In 1997,
House2Home spun off BJ's Wholesale Club, Inc. and BJ's Wholesale
Club, Inc. agreed to indemnify TJX for all liabilities relating to
the House2Home leases with respect to the period through January
31, 2003, and 50% of such liabilities thereafter. As a result of
House2Home's filing, TJX recorded an after-tax charge of $40
million, or $.14 per share, for potential contingent lease
obligations associated with House2Home. The charge was recorded in
the third quarter ending October 27, 2001 as a loss relating to
discontinued operations.
4. Certain amounts in the prior period's financial statements have
been reclassified to be consistent with the current year's
presentation.
