TJX: We're Going to Be Bigger
March 24, 2012-- Home Textiles Today,
FRAMINGHAM, MASS. - TJX Companies is ramping up expansion plans for the United States and Canada beyond previous expectations and now believes it can reach $40 billion in annual sales - nearly double its most recent fiscal year revenues.
"We believe Marmaxx will be a bigger business than we thought just over a year ago," said ceo Carol Meyrowitz during the company's analyst call last week. "We see this chain growing to at least 2,400 stores. We also believe HomeGoods is bigger than originally thought, and we've raised its growth expectations to 750 stores in 2012."
The Marmaxx division currently operates 1,867 stores and HomeGoods 374.
In Canada, TJX Cos. sees Marshalls as "another growth catalyst," she said. "We see the potential to grow TJX Canada overall to 430 stores, and we will be growing this business steadily."
Fiscal 2011 represented the third consecutive year that ended with significant increases in customer traffic. Marmaxx's comp increased 5% and Home Goods' 6%. Meyrowitz said bottom-line profit improved in both divisions.
Additionally, Marmaxx's sales rose 9% to $15.4 billion during the year, and HomeGoods grew by 14.6% to $2.2 billion.
TJX, said Meyrowitz, is "back on solid track." On a similar note, TJX Canada "regained momentum" at the end of 2011. The division posted a sales increase of 6.8% to $2.68 billion for the year.
Total company fiscal year sales rose 6% to $23.2 billion, with consolidated comps up 4%. Net income for the year ended Jan. 28 was $1.5 billion, and earnings per share from continuing operations were $1.93.
For the quarter, net income jumped 42% to $475.3 million, with earnings per share from continuing operations of 62 cents.
Total company sales for the quarter rose 6% to $6.7 billion. Consolidated same-store sales increased 7%.
To support growth, TJX Cos. laid out strategic investments it is making this year. They include supply chain systems, among them a new distribution center on the West Coast - the first new DC for Marmaxx in 10 years.
Also planned: a new data center and systems, additional store remodels and an ecommerce division.
"We plan to lever our $23 billion brick-and-mortar merchandise business and our merchant organization that is over 750 people strong," said Meyrowitz.
However, the company has not set a launch date for ecommerce - a business it briefly entered then abandoned in 2005.
As TJX Cos. works on these developments, the company also plans to build out its broad vendor base, which currently numbers more than 15,000.
"As we continue to expand our global sourcing, we plan to open more new vendor doors and build stronger vendor relationships," Meyrowitz said.
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