Boston, MA 05/22/2014 (wallstreetpr) – The TJX Companies, Inc. (NYSE:TJX) announced the first quarter operational performance ended May 3, 2014 with net income of $454 million on sales of $6.5 billion.
HomeGoods and Europe drive growth in sales
In the first quarter (1Q2015), net sales were $6.5 billion, increase by 5% due to 1% year over year increase in sales over comparable stores. In the U.S., Marmaxx’s sales remained flat at $4.2 billion and HomeGoods was up by 3% to $757 million. In the international market, Europe contributed 8% increase in sales to $891 million that partially offset the decreased Canada’s sales.
The Company is also well positioned with total inventories of $3.2 billion as of May 3, 2014 to take the advantage of growing of opportunities in branded and quality merchandise.
Higher domestic sales improved the margins
Gross profit margin was 27.9%, down by 0.5 percentage points versus 1Q2014, due to lower merchandise margins and increasing expenses over comparable stores. But, SG&A costs during the period remained flat and represented 16.5% of net sales.
As a result, adjusted pre-tax margin remained flat at ~12%. Net income during the period also improved to $454 million with diluted EPS of $0.64 versus $0.62 in 1Q2014.
Cash flow distributions
During 1Q2015, TJX repurchased stocks for $360 million and continues to repurchase a ~$1.6 to $1.7 billion of TJX stock in FY2015 as per the share repurchase plan. In addition, TJX increased its dividend by 21% in 1Q2015 and committed to returning cash to its shareholders by reinvesting to support growth in the near to long-term.
Outlook
Based on the ongoing trend, TJX expects 2% to 3% growth in comparable stores in the second quarter and expects 6% to 12% increase in diluted EPS to a range of $.70 to $.74.
Moreover, The TJX Companies, Inc. (NYSE:TJX) raised the guidance for FY2015 and continues to report 1% to 2% sales increase over it comparable stores and expects 8% to 12% YoY increase in diluted EPS, in a range of $3.05 to $3.17 in FY2015.
