Seeking Alpha
We cover over 5K calls/quarter
Profile| Send Message|
( followers)  

TJX Companies Inc. (NYSE:TJX)

December 2011 Sales/ Trading Statement

January 05, 2012 12:00 am ET

Executives

Sherry Lang - Senior Vice President of Global Communications

Sherry Lang

Good morning. This is Sherry Lang, Senior Vice President of Global Communications for the TJX Companies. Today is January 5, 2012, and I would like to welcome you to our Investor Call to discuss our December 2011 sales.

Before I begin, please note the forward-looking statements I make today about the company's results, expectations and plans are subject to risks and uncertainties that could cause actual results and actions to vary materially. These risks and uncertainties are discussed in the company's SEC filings including, without limitation, the Form 10-K filed March 30, 2011. Further, these comments are copyrighted by The TJX Companies. Any recording, rebroadcast, reproduction or other use of these comments for profit or otherwise without prior consent of TJX is prohibited and a violation of United States copyright laws. [Operator Instructions]

Now to recap the numbers. Sales for the 5-week period ended December 31, 2011, were $3.3 billion, up 8% over the $3 billion achieved during the 5-week period ended January 1, 2011. For the 48 weeks ended December 31, 2011, sales reached $21.8 billion, up 6% over last year's $20.6 billion.

Consolidated comparable store sales for December 2011 increased 8%, which was well above our plan. For the 48-week year-to-date period, consolidated comp store sales increased 4%.

We are extremely pleased with our December sales results as we significantly exceeded our expectations for this important month. As we have said many times, we believe that value continues to be extremely important to consumers, and we have emphasized that our being all about value is at the core of our business.

The retail environment during this holiday selling season was extremely promotional, and we made a strategic decision to offer extreme value by pricing aggressively in the face of this environment. As a result, our comp store sales were driven by sizable increases in customer traffic as our great values brands and gift-giving selections were a tremendous draw for consumers. Importantly, we believe that driving customers to our stores this holiday season will continue to benefit our business next year and in the longer term.

In addition, we are particularly pleased that sales were strong at every division and that both of our international businesses performed very well. In addition to our aggressive stance on pricing, we cleared a good deal of cold-weather apparel because of the unusual -- unusually mild winter temperatures. With these factors, we continue to expect fourth quarter fiscal 2012 earnings per share to be in the range of $1.19 to $1.23. While this guidance remains unchanged, it now includes an estimated $0.03 per share negative impact from several items detailed in today's press release that impact the comparability of results and were not anticipated in our original guidance provided on November 15, 2011. This guidance reflects our expectation that consolidated pretax margins for fourth quarter fiscal 2012 will be flat to up 20 basis points over last year.

We also announced today a 2-for-1 stock split detailed in our press release. Over the past 3 years, we have driven strong sales and earnings increases and our stock price has increased significantly. In addition, we believe that we have great growth opportunities in the U.S. and internationally, and that our business will continue to deliver superior financial returns. This stock split underscores our confidence in our ability to continue to significantly increase sales, earnings and cash flow.

Now to December's comp sales by division, which, again, were excellent across-the-board. Beginning with our U.S. divisions. At The Marmaxx Group, December comp store sales increased by a strong 7%, well exceeding our plans. I will go into further detail on Marmaxx in a moment.

At HomeGoods, comp store sales increased by a very strong 15% in December. HomeGoods had an outstanding December as it delivered customers an ever-changing array of gift-giving items and beautiful holiday fashions for the home.

Moving to TJX Canada. At Winners and HomeSense combined, comp store sales increased by a strong 5% in December over a 5% increase last year. We are very pleased with TJX Canada's performance in December. We believe that this business is getting its merchandise mix back on the right track.

Moving to TJX Europe. At T.K. Maxx and HomeSense combined, comp store sales increased by a very strong 14% in December. We are very encouraged by TJX Europe's trend, which further strengthened in December. As we begin a new year, we are excited about our opportunities to deliver great values and great brands to our European customers.

To give some additional color to December's results at the Marmaxx Group. Geographically, sales were very strong across the country, with all regions comping close to the chain's average. As to merchandise categories at Marmaxx, apparel comped up 7% and home fashions comped up 6% in December. Our gift-giving items, which we shipped to our stores continuously throughout December, were very strong.

Summing up. We are very pleased with our December and that sales at every division were strong. Further, we entered January with very lean inventories and the flexibility to ship fresh merchandise at great values to our stores.

Looking past January, we believe we are very well positioned to drive strong sales and margins. Again, we continue to expect fourth quarter earnings per share to be in the range of $1.19 to $1.23, including the impact of the previously unanticipated items which are detailed in today's press release.

As to comps for January on both the consolidated basis and at the Marmaxx Group, we continue to expect comp sales to increase 1% to 3%.

We will be reporting January sales on February 2, 2012. We will be reporting fourth quarter and year-end results on February 22, 2012, and will be providing guidance for fiscal 2013 at that time. [Operator Instructions] Thank you and have a good day.

Copyright policy: All transcripts on this site are the copyright of Seeking Alpha. However, we view them as an important resource for bloggers and journalists, and are excited to contribute to the democratization of financial information on the Internet. (Until now investors have had to pay thousands of dollars in subscription fees for transcripts.) So our reproduction policy is as follows: You may quote up to 400 words of any transcript on the condition that you attribute the transcript to Seeking Alpha and either link to the original transcript or to www.SeekingAlpha.com. All other use is prohibited.

THE INFORMATION CONTAINED HERE IS A TEXTUAL REPRESENTATION OF THE APPLICABLE COMPANY'S CONFERENCE CALL, CONFERENCE PRESENTATION OR OTHER AUDIO PRESENTATION, AND WHILE EFFORTS ARE MADE TO PROVIDE AN ACCURATE TRANSCRIPTION, THERE MAY BE MATERIAL ERRORS, OMISSIONS, OR INACCURACIES IN THE REPORTING OF THE SUBSTANCE OF THE AUDIO PRESENTATIONS. IN NO WAY DOES SEEKING ALPHA ASSUME ANY RESPONSIBILITY FOR ANY INVESTMENT OR OTHER DECISIONS MADE BASED UPON THE INFORMATION PROVIDED ON THIS WEB SITE OR IN ANY TRANSCRIPT. USERS ARE ADVISED TO REVIEW THE APPLICABLE COMPANY'S AUDIO PRESENTATION ITSELF AND THE APPLICABLE COMPANY'S SEC FILINGS BEFORE MAKING ANY INVESTMENT OR OTHER DECISIONS.

If you have any additional questions about our online transcripts, please contact us at: transcripts@seekingalpha.com. Thank you!

Source: TJX Companies Management Release December 2011 Sales/ Trading Statement (Transcript)
This Transcript
All Transcripts