TJX Companies (NYSE: TJX) said on Wednesday its profit and revenue came in better than expected in the fiscal second quarter amidst fears that the retail sector was starting to slow down from the pandemic highs.
Q2 financial performance
TJX reported $785.7 million of net income for the second quarter that translates to 64 cents a share. In the comparable period of last year, its net income was capped at a much lower $214.2 million or 18 cents per share.
The off-price department store chain generated $12.08 billion of sales versus the year-ago figure of $6.67 billion. According to FactSet, experts had forecast $11 billion in sales and 59 cents of EPS.
Shares of the company opened 1.0% down on Wednesday but recovered the intraday loss later on.
COVID-19 hit and other notable figures
As the delta variant of the Coronavirus made several TJX stores in Australia, Europe, and Canada, to shut down again during the second quarter, the American multinational took a $300 million to $350 million hit to sales and an up to 7 cents hit to EPS, the earnings press release disclosed.
Other notable figures in the earnings report include a consolidated pre-tax profit margin that stood at 8.7%, inventory that remained unchanged from last year at $5.1 and $7.1 billion in cash.
The owner of notable brands like TJ Maxx, HomeGoods, and Marshalls said its same-store sales at locations that were open in the recent quarter jumped 20%. Comparable store sales (open only) were up 12% internationally, 18% in Canada, 36% at HomeGoods, and 18% at Marmaxx.
CEO Ernie Herrman’s remarks
Due to the COVID-related uncertainty, the NYSE listed retailer refrained from giving its future guidance, but CEO Ernie Herrman expressed confidence that things were good.
Sales are very strong as we start the third quarter, with overall open-only comp store sales up mid-teens. While the environment remains uncertain, particularly with the Delta variant, we are convinced that TJX is in a position of strength. We see numerous opportunities to continue to gain market share and improve our profitability in the medium to longer term. We are confident in our ability to reach our long-term strategic vision of TJX becoming a $60 billion company.
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