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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
----------
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of The
Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): February 22, 2006
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THE TJX COMPANIES, INC.
(Exact name of Registrant as specified in charter)
DELAWARE 1-4908 04-2207613
- -------- ------ ----------
(State or other jurisdiction (Common File (I.R.S. employer
of incorporation) Number) identification No.)
----------
770 Cochituate Road, Framingham, MA 01701
-----------------------------------------
(Address of Principal Executive Offices) (Zip Code)
(508) 390-1000
--------------
Registrant's Telephone Number (including area code)
N/A
---
(Former name or former address,
if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities
Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange
Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
1
ITEM 2.02. RESULTS OF OPERATIONS AND FINANCIAL CONDITION
The information contained in this report is being furnished and shall not
be deemed to be "filed" for purposes of Section 18 of, or otherwise regarded as
filed under, the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), nor shall it be deemed incorporated by reference into any filing under
the Securities Act of 1933, as amended, or the Exchange Act, except as shall be
expressly set forth by specific reference in such filing:
On February 22, 2006, The TJX Companies, Inc. issued a press release
which included financial results for the fiscal year ended January 28,
2006. The release is furnished as Exhibit 99.1 hereto.
ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS
(C) EXHIBITS
Exhibit Number Title
- -------------- -----
99.1 Press Release, dated February 22, 2006 of The
TJX Companies, Inc.
2
SIGNATURES
- ----------
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, hereunto duly authorized.
THE TJX COMPANIES, INC.
/s/ Jeffrey G. Naylor
-------------------------------------
Jeffrey G. Naylor
Senior Executive Vice President and
Chief Financial Officer
Dated: February 22, 2006
3
EXHIBIT INDEX
Exhibit Number Description
- -------------- -----------
99.1 Press Release, dated February 22, 2006 of The
TJX Companies, Inc.
4
Exhibit 99.1
The TJX Companies, Inc. Reports Full Fiscal Year 2006 Results;
Fourth Quarter Earnings Above Plan
FRAMINGHAM, Mass.--(BUSINESS WIRE)--Feb. 22, 2006--The TJX
Companies, Inc. (NYSE: TJX), the leading off-price retailer of apparel
and home fashions in the U.S. and worldwide, today announced sales and
earnings results for the fiscal year and fourth quarter ended January
28, 2006. Net sales for the fiscal year were $16.1 billion, an 8%
increase over last year and consolidated comparable store sales
increased 2%. As previously announced, the Company has adopted the new
stock compensation accounting standard as of the fourth quarter of
fiscal year 2006. Accordingly, all results for current and prior
periods now reflect the impact of stock option expense (see below).
Net income for the 52-week fiscal year was $690 million, and diluted
earnings per share were $1.41 compared to $1.21 for the prior year.
Results for both years were impacted by certain one-time items, which
are described further below. Excluding these one-time items, pro forma
full-year diluted earnings per share were $1.29 versus $1.25 last
year.
For the 13-week fiscal 2006 fourth quarter, sales increased 9% to
$4.7 billion. Consolidated comparable store sales increased 3% over
last year. For the fourth quarter, net income was $289 million, and
diluted earnings per share were $.60 compared to $.33 in the prior
year. Excluding one-time items, pro forma diluted earnings per share
were $.46, an above-plan 24% increase over last year's $.37 in
earnings per share. A table reconciling reported results to pro forma
results is provided below.
Ben Cammarata, Chairman and Acting Chief Executive Officer of The
TJX Companies, Inc., stated, "Through improved execution and a renewed
focus on off-price disciplines, we brought 2005 to a very strong
finish, with fourth quarter earnings results that significantly
exceeded our expectations. The fourth quarter comparable store sales
increase of 3% was achieved on top of a healthy increase last year,
with merchandise margins that improved over the prior year despite a
challenging competitive environment. During the quarter, we solidly
executed our off-price concept by maintaining liquid inventories,
making the right buys, and flowing great product at great values to
our stores throughout the quarter. Additionally, we were effective in
our marketing and managed expenses well. As we begin a new year,
driving profitable sales growth continues to be our top priority.
Inventories are in excellent shape and we remain extremely focused on
executing all aspects of our business."
Sales by Business Segment
The Company's comparable store sales and net sales by division in
the fourth quarter were as follows:
Fourth Quarter Fourth Quarter
Comparable Store Sales Net Sales ($ in millions)
------------------------ -------------------------
FY2006 FY2005 FY2006 FY2005
- ----------------- ---------- ------------ ----------- ---------
Marmaxx(a) +4% +4% $3,128 $2,954
- ----------------- ---------- ------------ ----------- ---------
Winners/HomeSense +5% (US$) +4% (US$) $430 $372
+2% (C$) -4% (C$)
- ----------------- ---------- ------------ ----------- ---------
T.K. Maxx -2% (US$) +11% (US$) $487 $430
+7% (GBP) +3% (GBP)
- ----------------- ---------- ------------ ----------- ---------
HomeGoods +4% +3% $377 $316
- ----------------- ---------- ------------ ----------- ---------
A.J. Wright +6% +3% $206 $173
- ----------------- ---------- ------------ ----------- ---------
Bob's Stores NA NA $89 $85
- ----------------- ---------- ------------ ----------- ---------
- ----------------- ---------- ------------ ----------- ---------
TJX +3% +4% $4,716 $4,329
- ----------------- ---------- ------------ ----------- ---------
(a) Combination of T.J. Maxx and Marshalls
The Company's comparable store sales and net sales by division in
Fiscal 2006 were as follows:
Full Year Full Year
Comparable Store Sales Net Sales ($ in millions)
------------------------ -------------------------
FY2006 FY2005 FY2006 FY2005
- ----------------- ---------- ------------ ----------- ---------
Marmaxx(a) +2% +4% $10,957 $10,489
- ----------------- ---------- ------------ ----------- ---------
Winners/HomeSense +4% (US$) +10% (US$) $1,458 $1,285
-3% (C$) +4% (C$)
- ----------------- ---------- ------------ ----------- ---------
T.K. Maxx -1% (US$) +14% (US$) $1,517 $1,304
+1% (GBP) +3% (GBP)
- ----------------- ---------- ------------ ----------- ---------
HomeGoods +1% +1% $1,187 $1,013
- ----------------- ---------- ------------ ----------- ---------
A.J. Wright +3% +4% $651 $531
- ----------------- ---------- ------------ ----------- ---------
Bob's Stores NA NA $288 $291
- ----------------- ---------- ------------ ----------- ---------
- ----------------- ---------- ------------ ----------- ---------
TJX +2% +5% $16,058 $14,913
- ----------------- ---------- ------------ ----------- ---------
(a) Combination of T.J. Maxx and Marshalls
Early Adoption of Stock Option Expensing
The TJX Companies previously announced its early adoption of the
Statement of Financial Accounting Standards (SFAS) No. 123R, relating
to accounting for stock based compensation, in the fourth quarter of
Fiscal 2006. All financial information attached to or discussed in
this press release includes stock option expense, which reduced
earnings per share by $.03 in the fourth quarter and by $.12 for the
full fiscal 2006 year. The Company has elected the modified
retrospective transition method. Accordingly, prior period financial
statements have been adjusted to reflect the effect of stock option
expense on a consolidated basis, as previously disclosed in the pro
forma footnote to the TJX financial statements. Additionally, segment
data have been adjusted to reflect the related stock option expense
for all periods presented.
Impact of One-Time Items
Results for the fourth quarter and full year of Fiscal 2006
include a previously announced one-time tax benefit of $47 million, or
$.10 per share, resulting from the Company's repatriation of
accumulated earnings from its foreign operations. Fiscal 2006 results
also reflect the impact of certain previously announced, one-time
third quarter events (described further in the Company's SEC Form 10-Q
for the period ended October 28, 2005), which reduced earnings per
share by a net of $.02. In addition, during the fourth quarter of
Fiscal 2006, TJX's tax provision and net income were favorably
impacted by $22 million, or $.04 per share, relating to the correction
of a previously established deferred tax liability. This liability
related to foreign exchange gains on a loan to one of its foreign
subsidiaries, which are not taxable under U.S. tax regulations.
Finally, results for the fourth quarter and full year of Fiscal 2005
include a one-time, non-cash charge related to lease accounting which
reduced earnings per share by $.04.
The following table reconciles reported EPS to pro forma EPS
(excluding one-time items):(b)
Fourth Quarter Full Year
FY2006 FY2005 FY2006 FY2005
------ ------ ------ ------
EPS as reported $0.60 $0.33 $1.41 $1.21
One-time items:
Cumulative lease accounting charge - $0.04 - $0.04
Correction to deferred tax liability ($0.04) - ($0.04) -
Repatriation tax benefit ($0.10) - ($0.10) -
Third quarter events - - $0.02 -
------ ----- ------ -----
Pro forma EPS $0.46 $0.37 $1.29 $1.25
===== ===== ===== =====
(b) Stock option expense included for all periods
Margins
During the fourth quarter of Fiscal 2006, the Company's pretax
profit margin improved to 7.5%. The gross profit margin increased 1.0
percentage point to 23.1%, representing improved merchandise margins
as well as the impact of the one-time lease accounting charge on last
year's ratios, which accounts for 0.7 percentage points of this
increase. Selling, general and administrative costs as a percent of
sales improved 0.4 percentage points to 15.5%, primarily due to
leverage from general, administrative and store operations costs.
For the full year fiscal 2006, consolidated pretax profit margin
was 6.3%, down compared to the prior year, primarily due to the
de-levering effect of low single digit comparable store sales on
expense ratios.
Inventory
Total inventories as of January 28, 2006, were $2.4 billion
compared with $2.4 billion at the same time last year. Consolidated
inventories, on a per-store basis, including the warehouses, were down
11% from the prior year. At the Marmaxx division, average per-store
inventories, including the warehouses, were down 10% from last year's
levels. Including merchandise on order, Marmaxx's total inventory
commitment was down on a per-store basis.
Share Repurchases
During the fourth quarter, the Company spent a total of $85
million in repurchases of TJX stock, retiring 3.6 million shares. In
Fiscal 2006, the Company spent a total of $600 million in stock
repurchases, as planned, and retired a total of 25.9 million shares of
TJX stock. During the fourth quarter, the Company completed its $1
billion share repurchase program that was initiated in 2004. As
previously announced, in October 2005, the Company's Board of
Directors approved a new stock repurchase program that authorizes the
repurchase of up to $1 billion of TJX common stock from time to time.
At current prices, this would represent approximately 9% of the
Company's outstanding common shares.
2006 Outlook
For the fiscal year ended January 27, 2007, the Company expects
earnings per share in the range of $1.42 to $1.46, which represents a
10% to 13% increase over the pro forma $1.29 per share earned in
Fiscal 2006, excluding one-time items. This is based upon estimated
consolidated comparable store sales growth in the 2% to 3% range.
For the first quarter of Fiscal 2007, the Company expects earnings
per share in the range of $.31 to $.33, versus $.28 per share in the
prior year, which is based upon estimated consolidated comparable
store sales growth in the 2% to 3% range.
Stores by Concept
During the fiscal year ended January 28, 2006, the Company added a
total of 157 stores, net of closings, to end the year with 2,381
stores, and increased square footage by 8% over the same period last
year. In the fourth quarter, the Company added a net 10 stores.
Store Locations Gross Square Feet
FY2006 FY2006
(in millions)
---------------- ----------------
Beginning End Beginning End
- --------------------------- --------- ----- --------- ----
T.J. Maxx 771 799 22.8 23.8
- --------------------------- --------- ----- --------- ----
Marshalls 697 715 21.9 22.7
- --------------------------- --------- ----- --------- ----
Winners 168 174 4.9 5.1
- --------------------------- --------- ----- --------- ----
HomeSense 40 58 1.0 1.4
- --------------------------- --------- ----- --------- ----
HomeGoods 216 251 5.4 6.2
- --------------------------- --------- ----- --------- ----
T.K. Maxx 170 197 4.8 5.9
- --------------------------- --------- ----- --------- ----
A.J. Wright 130 152 3.3 3.9
- --------------------------- --------- ----- --------- ----
Bob's Stores 32 35 1.5 1.6
- --------------------------- --------- ----- --------- ----
- --------------------------- --------- ----- --------- ----
TJX 2,224 2,381 65.5 70.5
- --------------------------- --------- ----- --------- ----
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 799 T.J. Maxx, 715 Marshalls, 251 HomeGoods and 152 A.J.
Wright stores, as well as 35 Bob's Stores, in the United States. In
Canada, the Company operates 174 Winners and 58 HomeSense stores, and
in Europe, 197 T.K. Maxx stores. TJX's press releases and financial
information are also available on the Internet at www.tjx.com.
Fiscal 2006 Year-End and Fourth Quarter Earnings Conference Call
At 11:00 a.m. ET today, Ben Cammarata, Chairman and Acting Chief
Executive Officer, and Carol Meyrowitz, President of TJX, will hold a
conference call with stock analysts to discuss the Company's fiscal
2006 results, operations and business trends, as well as expectations
for Fiscal 2007. A real-time webcast of the call will be available at
www.tjx.com. A replay of the call will also be available at
www.tjx.com or by dialing (800) 216-3035 through Wednesday, March 1,
2006.
February 2006 Sales Recording
Additionally, the Company expects to release its February 2006
sales on Thursday, March 2, 2006, at approximately 8:15 a.m. ET.
Concurrent with that press release, a recorded message with more
detailed information regarding TJX's February sales results,
operations and business trends will be available via the Internet at
www.tjx.com, or by calling (703) 736-7248 through Thursday, March 9,
2006.
Archived versions of the Company's recorded messages and
conference calls are available at www.tjx.com after they are no longer
available by telephone.
Forward-looking Statements
SAFE HARBOR STATEMENTS 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, including
projections of earnings per share and same store sales, are
forward-looking statements. The following are some of the factors that
could cause actual results to differ materially from the
forward-looking statements: our ability to continue successful
expansion of our store base; risks of expansion; our ability to
successfully implement our opportunistic inventory strategies and to
effectively manage our inventories; consumer confidence, demand,
spending habits and buying preferences; effects of unseasonable
weather; competitive factors; factors affecting availability of store
and distribution center locations on suitable terms; factors affecting
our recruitment and employment of 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;
availability and cost of financing; general economic conditions,
including gasoline prices; potential disruptions due to wars, natural
disasters and other events beyond our control; changes in currency and
exchange rates; elimination of Canadian quotas; import risks; adverse
outcomes for any significant litigation; changes in laws and
regulations and accounting rules and principles; effectiveness of
internal controls; 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.
THE TJX COMPANIES, INC. AND CONSOLIDATED SUBSIDIARIES
FINANCIAL SUMMARY
(Unaudited)
(Dollars In Thousands Except Per Share Amounts)
13 Weeks 13 Weeks
Ended Ended
----------- -----------
January 28, January 29,
2006 2005 (A)
---------- ----------
Net sales $4,716,327 $4,329,109
Cost of sales, including buying and
occupancy costs (See Note 3) 3,626,370 3,373,303
Selling, general and administrative
expenses 732,111 686,814
Interest expense, net 5,560 5,047
---------- ----------
Income before provision for income taxes 352,286 263,945
Provision for income taxes 63,583 98,965
---------- ----------
Net income $ 288,703 $ 164,980
========== ==========
Diluted earnings per share:
Net income $ .60 $ .33
Cash dividends declared per share $ .06 $ .045
Weighted average shares for diluted
earnings per share computation 485,452,273 507,231,935
(A) The periods ended January 29, 2005 have been adjusted to reflect
the adoption of SFAS No. 123R. See Note 1
THE TJX COMPANIES, INC. AND CONSOLIDATED SUBSIDIARIES
FINANCIAL SUMMARY
(Unaudited)
(Dollars In Thousands Except Per Share Amounts)
52 Weeks 52 Weeks
Ended Ended
----------- -----------
January 28, January 29,
2006 2005 (A)
----------- -----------
Net sales $16,057,935 $14,913,483
Cost of sales, including buying and
occupancy costs (See Note 3) 12,295,016 11,398,656
Selling, general and administrative
expenses 2,723,960 2,500,119
Interest expense, net 29,632 25,757
----------- -----------
Income before provision for income taxes 1,009,327 988,951
Provision for income taxes 318,904 379,252
----------- -----------
Net income $ 690,423 $ 609,699
=========== ===========
Diluted earnings per share:
Net income $ 1.41 $ 1.21
Cash dividends declared per share $ .24 $ .18
Weighted average shares for diluted
earnings per share computation 491,499,531 509,660,827
(A) The periods ended January 29, 2005 have been adjusted to reflect
the adoption of SFAS No. 123R. See Note 1
THE TJX COMPANIES, INC. AND CONSOLIDATED SUBSIDIARIES
Supplemental Information - Pro forma net income and EPS
Fourth Quarter and Fiscal Year Ended January 28, 2006
and January 29, 2005
(Dollars in Millions Except Per Share Amounts)
13 Weeks Ended 13 Weeks Ended
---------------- ----------------
Fourth Quarter Ended: January 28, 2006 January 29, 2005
---------------- ----------------
$'s EPS $'s EPS
------ ------ ------ ------
Net income as reported $288.7 $ 0.60 $165.0 $ 0.33
Remove items impacting
comparability:
Cumulative lease accounting charge - - 19.3 0.04
Impact of deferred tax liability
correction (21.7) (0.04) - -
Repatriation income tax benefit (47.0) (0.10) - -
------ ------ ------ ------
Pro forma net income $220.0 $ 0.46 $184.3 $ 0.37
====== ====== ====== ======
52 Weeks Ended 52 Weeks Ended
---------------- ----------------
Fiscal Year Ended: January 28, 2006 January 29, 2005
---------------- ----------------
$'s EPS $'s EPS
------ ------ ------ ------
Net income as reported $690.4 $ 1.41 $609.7 $ 1.21
Remove items impacting
comparability:
Cumulative lease accounting charge - - 19.3 0.04
Impact of deferred tax liability
correction (21.7) (0.04) - -
Repatriation income tax benefit (47.0) (0.10) - -
Third quarter events 11.6 0.02 - -
------ ------ ------ ------
Pro forma net income $633.3 $ 1.29 $629.0 $ 1.25
====== ====== ====== ======
THE TJX COMPANIES, INC. AND CONSOLIDATED SUBSIDIARIES
CONDENSED BALANCE SHEETS
(Unaudited)
(In Millions)
January 28, January 29,
2006 2005
----------- -----------
ASSETS
Current assets:
Cash and cash equivalents $ 465.6 $ 307.2
Accounts receivable and other current assets 308.6 245.9
Merchandise inventories 2,365.9 2,352.0
-------- --------
Total current assets 3,140.1 2,905.1
-------- --------
Property and capital leases, net of depreciation 2,013.1 1,861.1
Non-current deferred income taxes, net 6.4 -
Other assets 153.3 125.5
Goodwill and tradename, net of amortization 183.4 183.8
-------- --------
TOTAL ASSETS $5,496.3 $5,075.5
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current installments of long-term debt $ - $ 100.0
Accounts payable 1,313.5 1,276.0
Accrued expenses and other current liabilities 938.4 828.1
-------- --------
Total current liabilities 2,251.9 2,204.1
-------- --------
Other long-term liabilities 568.9 492.7
Non-current deferred income taxes, net - 59.5
Long-term debt 782.9 572.6
Shareholders' equity 1,892.6 1,746.6
-------- --------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $5,496.3 $5,075.5
======== ========
THE TJX COMPANIES, INC. AND CONSOLIDATED SUBSIDIARIES
CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
(In Millions)
52 Weeks 52 Weeks
Ended Ended
----------- -----------
January 28, January 29,
2006 2005
----------- -----------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 690.4 $ 609.7
Depreciation and amortization 314.3 279.1
Deferred income tax provision (88.3) 22.8
Amortization of stock compensation 92.1 100.1
Decrease (increase) in accounts receivable
and other current assets (56.2) 8.2
(Increase) in merchandise inventories (8.8) (390.7)
Increase in accounts payable 35.0 305.3
Increase in accrued expenses and other
liabilities 171.3 154.6
Other, net 8.4 (12.3)
-------- --------
Net cash provided by operating activities 1,158.2 1,076.8
-------- --------
CASH FLOWS FROM INVESTING ACTIVITIES:
Property additions (495.9) (429.1)
Proceeds from sale of property 9.7 -
Other .6 .6
-------- --------
Net cash (used in) investing activities (485.6) (428.5)
-------- --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from borrowings of long-term debt 204.4 -
Principal payments on long-term debt (100.0) (5.0)
Payments for repurchase of common stock (603.7) (594.6)
Cash dividends paid (105.2) (83.4)
Other 100.6 98.4
-------- --------
Net cash (used in) financing activities (503.9) (584.6)
-------- --------
Effect of exchange rate changes on cash (10.3) (2.9)
-------- --------
Net increase in cash and cash equivalents 158.4 60.8
Cash and cash equivalents at beginning of year 307.2 246.4
-------- --------
Cash and cash equivalents at end of year $ 465.6 $ 307.2
======== ========
THE TJX COMPANIES, INC. AND CONSOLIDATED SUBSIDIARIES
SELECTED INFORMATION BY MAJOR BUSINESS SEGMENT
(Unaudited)
(In Thousands)
Pro Forma (1)
13 Weeks 13 Weeks 13 Weeks
Ended Ended Ended
----------- ----------- -----------
January 28, January 29, January 29,
Net Sales: 2006 2005 2005
----------- ----------- -----------
Marmaxx $3,128,132 $2,954,203 $2,954,203
Winners and HomeSense 429,716 371,901 371,901
T.K. Maxx 486,801 429,942 429,942
HomeGoods 376,796 315,674 315,674
A.J. Wright 205,757 172,847 172,847
Bob's Stores 89,125 84,542 84,542
---------- ---------- ----------
$4,716,327 $4,329,109 $4,329,109
========== ========== ==========
Segment profit or (loss):
Marmaxx 283,067 255,329 272,136
Winners and HomeSense 41,828 22,221 25,759
T.K. Maxx 41,495 27,781 34,254
HomeGoods 26,902 5,694 7,937
A.J. Wright 8,241 (4,187) (2,525)
Bob's Stores (4,641) (8,301) (8,301)
---------- ---------- ----------
396,892 298,537 329,260
Lease Accounting Adjustment (1) - - 30,723
General Corporate Expense 39,046 29,545 29,545
Interest expense, net 5,560 5,047 5,047
---------- ---------- ----------
Income before provision for
income taxes $ 352,286 $ 263,945 $ 263,945
========== ========== ==========
Stores in operation:
T.J. Maxx 799 771
Marshalls 715 697
Winners 174 168
HomeSense 58 40
T.K. Maxx 197 170
HomeGoods 251 216
A.J. Wright 152 130
Bob's Stores 35 32
----- -----
Total 2,381 2,224
===== =====
(1) The pro forma column for the period ended January 29, 2005
reflects the impact of the lease accounting adjustment as a single
line item and removes the impact from the individual segments. See
Note 3 for an explanation of the lease accounting adjustment and a
reconciliation of the reported segment profit to the pro forma
segment profit.
THE TJX COMPANIES, INC. AND CONSOLIDATED SUBSIDIARIES
SELECTED INFORMATION BY MAJOR BUSINESS SEGMENT
(Unaudited)
(In Thousands)
Pro Forma (1)
52 Weeks 52 Weeks 52 Weeks
Ended Ended Ended
----------- ----------- -----------
January 28, January 29, January 29,
Net Sales: 2006 2005 2005
----------- ----------- -----------
Marmaxx $10,956,788 $10,489,478 $10,489,478
Winners and HomeSense 1,457,736 1,285,439 1,285,439
T.K. Maxx 1,517,116 1,304,443 1,304,443
HomeGoods 1,186,854 1,012,923 1,012,923
A.J. Wright 650,961 530,643 530,643
Bob's Stores 288,480 290,557 290,557
----------- ----------- -----------
$16,057,935 $14,913,483 $14,913,483
=========== =========== ===========
Segment profit or (loss):
Marmaxx $ 985,361 $ 982,082 $ 998,889
Winners and HomeSense 120,319 99,701 103,239
T.K. Maxx 69,206 63,975 70,448
HomeGoods 28,418 18,148 20,391
A.J. Wright (2,202) (19,626) (17,964)
Bob's Stores (28,031) (18,512) (18,512)
----------- ----------- -----------
1,173,071 1,125,768 1,156,491
Lease Accounting Adjustment (1) - - 30,723
General Corporate Expense 134,112 111,060 111,060
Interest expense, net 29,632 25,757 25,757
----------- ----------- -----------
Income before provision for
income taxes $ 1,009,327 $ 988,951 $ 988,951
=========== =========== ===========
Stores in operation:
T.J. Maxx 799 771
Marshalls 715 697
Winners 174 168
HomeSense 58 40
T.K. Maxx 197 170
HomeGoods 251 216
A.J. Wright 152 130
Bob's Stores 35 32
----- -----
Total 2,381 2,224
===== =====
(1) The pro forma column for the period ended January 29, 2005
reflects the impact of the lease accounting adjustment as a single
line item and removes the impact from the individual segments. See
Note 3 for an explanation of the lease accounting adjustment and a
reconciliation of the reported segment profit to the pro forma
segment profit.
The TJX Companies, Inc. Notes To Consolidated
and Consolidated Subsidiaries Condensed Financial Statements
1. In the fourth quarter of the fiscal year ended January 28, 2006 The
TJX Companies, Inc. elected to early adopt the provisions of
Statement of Financial Accounting Standards (SFAS) No. 123R,
"Accounting for Stock Based Compensation". SFAS No. 123R requires
that the cost of equity-based awards be recognized in the
financial statements. In addition, TJX elected the modified
retrospective transition method which requires that all prior
period financial statements be adjusted to the pro forma amounts
previously disclosed in the company's notes to its financial
statements. Thus the previously reported results for the periods
ended January 29, 2005 have been adjusted to reflect the effect of
adopting SFAS 123R. TJX filed a Current Form 8-K on February 2,
2006 which announced its early adoption of SFAS 123R and included
the effect of the modified retrospective transition method on
certain prior periods.
The impact of adopting SFAS 123R reduced net income for the
periods ended January 28, 2006 by $12.6 million, or $.03 per
diluted share, for the fourth quarter and $54.5 million, or $.12
per share, for the full fiscal year. The adjustment to the periods
ended January 29, 2005 reduced previously reported net income by
$12.0 million, or $.02 per share in the fourth quarter and by
$54.4 million, or $.09 per share for the full fiscal year.
2. The tax provision for the periods ended January 28, 2006 includes a
one-time benefit of $47 million, or $.10 per share, for the
repatriation of approximately US$260 million of earnings from its
Canadian operations. Recent tax law changes provided a temporary
incentive for multinationals to repatriate foreign earnings at
reduced income tax rates.
In addition, during the fourth quarter TJX recorded an additional
tax benefit due to the correction of an overstatement of its
deferred tax liability. In prior periods TJX provided for income
taxes on foreign currency gains or losses associated with
intercompany loans with its Canadian subsidiary. The gains and
losses associated with these loans are fully hedged and do not
impact pre-tax income, however the foreign currency gains or
losses on the underlying intercompany debt are not subject to
income taxes. The cumulative impact of this correction increased
net income by $22 million, or $.04 per share, in the fourth
quarter and fiscal year ended January 28, 2006.
3. In the fourth quarter ended January 29, 2005, The TJX Companies
recorded a one-time, non-cash charge to conform its accounting
policies with generally accepted accounting principles related to
the timing of rent expense. This charge resulted in a one-time,
cumulative, non-cash adjustment to rent expense of approximately
$19 million after-tax, or $.04 per share, in the fourth quarter
ended January 29, 2005.
On a pre-tax basis the amount of this charge is $30.7 million,
which has been recorded in cost of sales, including buying and
occupancy costs, on the Company's consolidated income statement.
Segment profit for the fiscal year ended January 29, 2005 has also
been reduced by this charge. The pro forma segment profit for the
fourth quarter and year-to-date periods ended January 29, 2005,
excluding this charge are presented below.
Pro forma segment profit for fourth quarter
ended January 29, 2005
-------------------------------------------
As Reported Lease charge Pro forma
----------- ------------ ---------
Marmaxx $255,329 $ 16,807 $272,136
Winners and HomeSense 22,221 3,538 25,759
T.K. Maxx 27,781 6,473 34,254
HomeGoods 5,694 2,243 7,937
A.J. Wright (4,187) 1,662 (2,525)
Bob's Stores (8,301) - (8,301)
-------- -------- --------
Total $298,537 $ 30,723 $329,260
======== ======== ========
Pro forma segment profit for fiscal year
ended January 29, 2005
-----------------------------------------
As Reported Lease charge Pro forma
----------- ------------ ----------
Marmaxx $ 982,082 $ 16,807 $ 998,889
Winners and HomeSense 99,701 3,538 103,239
T.K. Maxx 63,975 6,473 70,448
HomeGoods 18,148 2,243 20,391
A.J. Wright (19,626) 1,662 (17,964)
Bob's Stores (18,512) - (18,512)
---------- ---------- ----------
Total $1,125,768 $ 30,723 $1,156,491
========== ========== ==========
4. During the fourth quarter ended January 28, 2006, TJX repurchased
3.6 million shares of its common stock, at a cost of $85.3
million. During the twelve months ended January 28, 2006, TJX
repurchased 25.9 million shares for a cost of $600.0 million. In
October 2005, TJX announced that its Board of Directors had
approved a new multi-year program for the repurchase of an
additional $1 billion of TJX common stock. Through January 28,
2006, under its current $1 billion multi-year stock repurchase
program, TJX has repurchased 268 thousand shares at a cost of $6.6
million.
5. Certain amounts in the prior period's financial statements have
been reclassified to be consistent with the current year's
presentation.
CONTACT: The TJX Companies, Inc.
Sherry Lang, Vice President
Investor and Public Relations
(508) 390-2323