TJX profit outlook was raised after the off-price retailer reported second-quarter results above plan, supported by 4% comparable-sales growth and improved merchandise margins.
The off-price retailer reported fiscal second-quarter net sales of $15.18 billion, up 5% from a year earlier, adjusted earnings per share of $1.22, and an adjusted pretax margin of 11.9%, according to its earnings release. The revised TJX profit outlook calls for a full-year adjusted pretax margin of 12.0%-12.1% and adjusted EPS of $5.15-$5.20.
For the third quarter, the company officially forecast comparable-sales growth of 2%-3%, an adjusted pretax margin of 12.3%-12.4%, and adjusted EPS of $1.30-$1.32. The Fly reported that TJX also projected revenue of $15.6 billion-$15.8 billion, compared with a cited consensus estimate of $15.9 billion. That revenue range and the consensus figure were not included in TJX’s written release and could not be independently confirmed from a primary source.
Second-quarter GAAP results included $331 million in refunds tied to IEEPA tariffs, partly offset by $112 million of additional incentive and bonus accruals. TJX said the net pretax benefit was $219 million, or $0.14 per share, and expects a further $0.06-per-share benefit in the third quarter. It cautioned that the timing, amount and likelihood of further refunds remain uncertain.
Performance differed across divisions: Marmaxx comparable sales rose 1%, while HomeGoods, Canada and International posted gains of 7%, 6% and 7%, respectively. Management said Marmaxx sales improved at the beginning of the third quarter.
Source: The Fly
