The TJX Companies, Inc. Announces Sale of Bob’s Stores and Updates Guidance

FRAMINGHAM, Mass.--(BUSINESS WIRE)--The TJX Companies, Inc. (NYSE: TJX), the leading off-price retailer of apparel and home fashions in the U.S. and worldwide, today announced that it has sold Bob’s Stores to private equity firms Versa Capital Management and Crystal Capital. Terms of the sale were not disclosed.

Carol Meyrowitz, President and Chief Executive Officer of The TJX Companies, Inc., stated, “While we continue to believe Bob’s Stores has great potential and an excellent organization, our decision to sell the business reflects our vision to grow TJX as a global, off-price company. We believe that focusing on the significant opportunities to expand the domestic and international presence of our core, off-price concepts is the right strategy for us at this time. Bob’s Stores has made a great deal of progress in improving its comparable store sales, operating results and cash flow over the past two years. We are sincerely grateful for the hard work and commitment of the Bob’s Stores team, and we wish them much future success.”

Financial Impact of Sale/Reclassification of Bob’s Stores to Discontinued Operations

The Company will record an after-tax loss in its Fiscal 2009 third quarter of approximately $15 million, or $.03 per share, from the sale of Bob’s Stores, which will be reported as a loss from discontinued operations. In the third quarter and going forward, historical results will also be adjusted to reflect the Bob’s Stores business segment as discontinued operations. Accordingly, the loss on the sale and the operating losses related to Bob’s Stores will not impact results from continuing operations. The sale is expected to generate cash proceeds of approximately $23 million, which primarily represents anticipated tax benefits, as well as the proceeds from the sale, partially offset by fees and expenses related to the transaction.

Updated Guidance

As a result of this sale and reclassification of Bob’s Stores to discontinued operations, the Company is updating its guidance to reflect income from continuing operations, which will exclude the impact of the sale of Bob’s Stores and its operating results. The Company’s guidance for the third and fourth quarter for diluted earnings per share from continuing operations is unchanged from the guidance for diluted earnings per share previously issued in the Company’s 8/12/08 press release. However, the Company now expects full year Fiscal 2009 diluted earnings per share from continuing operations to be in the range of $2.30 to $2.35, which represents an increase over prior guidance for diluted earnings per share due to the reclassification of Bob’s Stores results to discontinued operations.

Full year guidance for diluted earnings per share from continuing operations for the current fiscal year includes an expected $.09 per share benefit from the 53^rd week in the Company’s Fiscal 2009 fourth quarter as well as $.02 per share of unanticipated tax-related adjustments recorded in the first quarter of Fiscal 2009. Last year’s results included a charge of $.25 per share related to the previously announced computer intrusion(s). Excluding these items, full year Fiscal 2009 adjusted diluted earnings per share from continuing operations are estimated to be in the range of $2.19 to $2.24, an increase of 13% to 16% over prior year’s adjusted $1.93.

The following table compares prior guidance for diluted earnings per share and updated guidance for diluted earnings per share from continuing operations. Prior guidance included Bob’s Stores results in continuing operations; updated guidance reclassifies Bob’s Stores results to discontinued operations.

		Guidance as of 8/12/2008				Updated Guidance
Fiscal Year 2009 – Estimate
Estimated diluted earnings per share from continuing operations on GAAP basis		$	2.26-2.31			$	2.30-2.35
Estimated benefit from 53rd week			(0.09	)			(0.09	)
Unanticipated first quarter tax benefits			(0.02	)			(0.02	)
Bob’s Stores impairment charge			0.02			- (a)
Estimated diluted earnings per share from continuing operations, as adjusted		$	2.17-2.22			$	2.19-2.24
Fiscal Year 2008 - Actual
Diluted earnings per share from continuing operations on GAAP basis		$	1.66			$	1.68
Impact of Provision for Computer Intrusion related costs			0.25				0.25
Diluted earnings per share from continuing operations, as adjusted		$	1.91			$	1.93
Percentage change from prior year in diluted earnings per share from continuing operations, as adjusted			14% - 16%				13% - 16%
(a) Bob’s Stores impairment charge reclassified to discontinued operations upon sale.

Advisors

The Peter J. Solomon Company, LLC acted as financial advisor and Ropes & Gray LLP provided legal counsel to the Company in connection with this transaction.

About Bob’s Stores

Bob’s Stores, based in Meriden, CT, was acquired by The TJX Companies in late 2003 and is a value-oriented, casual clothing and footwear superstore for the entire family. Bob’s Stores’ net sales were $310 million for the fiscal year ended January 26, 2008, and it currently operates 34 store locations in the Northeastern U.S.

About The TJX Companies, Inc.

The TJX Companies, Inc. is the leading off-price retailer of apparel and home fashions in the U.S. and worldwide. The Company operates 859 T.J. Maxx, 787 Marshalls, 297 HomeGoods, and 132 A.J. Wright stores in the United States. In Canada, the Company operates 196 Winners and 73 HomeSense stores, and in Europe, 231 T.K. Maxx and 6 HomeSense stores. TJX’s press releases and financial information are also available on the Internet at www.tjx.com.

SAFE HARBOR STATEMENT 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: matters relating to the computer intrusion(s) including potential losses that could differ from our reserve, potential effects on our reputation and sales, compliance with orders, and other consequences to the value of our Company and related value of our stock; our ability to successfully expand our store base and increase comparable store sales; risks of expansion and costs of contraction; risks inherent in foreign operations; our ability to successfully implement our opportunistic buying strategies and to manage our inventories effectively; successful advertising and promotion; consumer confidence, demand, spending habits and buying preferences; effects of unseasonable weather; competitive factors; availability of store and distribution center locations on suitable terms; our ability to recruit and retain associates; factors affecting expenses; success of our acquisition and divestiture activities; our ability to successfully implement technologies and systems and protect data; our ability to continue to generate adequate cash flows; our ability to execute our share repurchase program; availability and cost of financing; general economic conditions, including fluctuations in the price of oil; potential disruptions due to wars, natural disasters and other events beyond our control; changes in currency and exchange rates; issues with merchandise quality and safety; import risks; adverse outcomes for any significant litigation; compliance with and changes in laws and regulations and accounting rules and principles; adequacy of reserves; asset impairments and other charges; closing adjustments; failure to meet market expectations; 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.