While most retailers didn’t have much to celebrate this earnings season, TJX managed to post another strong set of results – though this time the tone was somewhat less buoyant than usual.
In Q2 TJX logged profits of $562.2 million, beating analysts predictions and putting the firm about $12 million ahead of the $549.3 million it reported a year ago. Revenues were also on the rise – and more strongly than the professionals were expecting to see – up 7 percent to $7.88 billion. Same-store sales growth also remained strong – up 4 percent and well above analysts’ predictions of 2 to 3 percent.
Unlike almost every other retailer we’re covering these days, TJX isn’t closing stores – it’s opening new ones. In the U.S. the brand’s store count is up by 14 in Q2, bringing the total number of TJX-backed physical locations to 3,675. Square footage rose by 5% over the same period last year.
“We believe our robust sales, customer traffic and merchandise margins all speak to the strength of our off-price retail model,” said Ernie Herrman, CEO and president, TJX Companies. “With our above-plan second quarter results, we are raising our guidance for full-year comp sales to increase 3 to 4 percent and earnings per share to be in the range of $3.39 to $3.43.”
So mostly good news – but not entirely.
TJX also forecast Q3 profits will miss estimates as it faces rising wages combined with an unusually valuable dollar. The company forecast per-share earnings of 83 to 85 cents. Analysts expected per-share profit of 90 cents.