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HomeGoods boosts 3Q sales at TJX

Don Hogsett -- Home Textiles Today, December 2, 2002

Getting a lift from a strong performance at its new HomeGoods unit, where same-store sales jumped up by 8.0 percent, third-quarter sales at off-price giant The TJX Companies climbed by 11.1 percent, to $3.0 billion from $2.7 billion last year.

Virtually all of the double-digit gain in sales came from continued rapid expansion, and same-store sales for all of TJX rose by 2.0 percent.

Third-quarter profits shot up by 34.6 percent, to $147.4 million from $109.5 million last year and would have climbed even higher but for a $10 million after-tax charge stemming from claims related to four California lawsuits. Further clouding the bottom line, last year's third quarter included a $40 million loss stemming from discontinued operations. Pulling out all the one-time items to level the earnings playing field, third-quarter earnings from continuing operations rose by 11.0 percent on a per-share basis, the retailer reported.

Edmond English, president and ceo, commented, "We continue to see very strong new store openings across all of our businesses. Although comparable store sales in September were soft due to unusually warm weather, our quick reaction to clear merchandise aggressively put us in an excellent position to continue to flow fresh, exciting merchandise to our stores. This paid off with above-plan sales in October, when weather turned seasonable, and positions us extremely well for the holiday season. Further, we are particularly pleased with the performance of our Winners, HomeGoods and T.K. Maxx divisions, each of which saw tremendous growth in profitability."

HomeGoods, said English, "had a terrific quarter, posting a strong 8.0 percent comparable store sales increase and excellent new store performance. Operating income at HomeGoods reached $12 million, significantly outpacing our objectives and almost eight times what it achieved last year. This division is firing on all cylinders, and we are excited about the momentum that HomeGoods is building."

The TJX Companies Inc.

Qtr. 10/26 (x000) 2002 2001 % change
a-Earnings in the third-quarter and nine-month periods include a $10 after-tax charge for claims related to four California lawsuits. Excluding the charge, earnings from continuing operations increased by 11 percent. Earnings in the third-quarter and nine-month periods of 2001 included a $40 million loss stemming from discontinued operations.
Sales $3,044,950 $2,741,769 11.1
Oper. income (EBIT) 246,473 250,052 -1.4
Net income 147,355a 109,498a 34.6
Per share (diluted) 0.28 0.20 40.0
Average gross margin 24.8% 24.9%
SG&A expenses 16.7% 15.7%
Nine months
Sales 8,475,726 7,500,286 13.0
Oper. income (EBIT) 707,139 640,536 10.4
Net income 424,085a 345,077a 22.9
Per share (diluted) 0.78 0.62 25.8
Average gross margin 25.0% 24.8%
SG&A expenses 16.6% 16.2%


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