TJX Reports Full-Year Results
Framingham, Mass., The TJX Cos. reported net sales of $14.9 billion for its fiscal year 2005, ended Jan. 29, up 12% over fiscal 2004. Consolidated same-store sales increased 5% over the year-ago period. Net income was $664 million and diluted earnings per share were $1.30. The results include the impact of a one-time, non-cash charge related to lease accounting, as well as the 4? per share impact of implementation of a recent accounting standard relating to the company’s convertible debt. Excluding these items, full-year pro forma diluted earnings per share were $1.38 vs. $1.28 last year.
The company’s largest division, the Marmaxx Group, which includes T.J. Maxx and Marshalls, was its best-performing. The results were driven by strength in women’s sportswear and the successful expansion of jewelry and accessories at T.J. Maxx, and footwear at Marshalls. The company expects to grow the Marmaxx Group by 47 stores this year.
“While results at our other divisions were below our expectations, the strong performance of The Marmaxx Group enabled TJX to deliver full-year earnings per share that were in line with our expectations, before the two accounting items. These strong results led to a 41% after-tax return on average shareholders’ equity,” said Edmond English, president and CEO, The TJX Cos. “As we enter the new year, we are excited by the momentum at Marmaxx and continue to view this business as a key growth vehicle for TJX.”
TJX will expand its other banners, as well. It plans to open 40 HomeGoods stores, 25 A.J. Wright stores and five Bob’s Stores in 2005. It also will grow its Canadian concepts, adding four Winners units and 17 HomeSense outlets.
PacSun Names d.e.m.o. President
Anaheim, Calif., Pacific Sunwear of California Inc. hired Lou Ann Bett to be division president of its d.e.m.o. division. The appointment becomes effective May 1. Bett most recently served with Limited Corp. as VP and general merchandise manager of Express Men’s.
Kohl’s, Gymboree to Restate Results
San Francisco, Kohl’s Corp. and The Gymboree Corp. are the latest retailers to announce they would need to restate their earnings due to an accounting change. The accounting change relates to the way the retailers account for their leases, and a recent clarification of those accounting principles by the Securities & Exchange Commission (SEC). Gymboree noted that the SEC’s interpretation prompted many retailers to announce adjustments and restatements related to lease accounting.
Kohl’s will restate some information stretching from 1998 to the first three quarters of 2004. The retailer said that the accounting changes would negatively impact net income by $2 million in the fourth quarter of 2004. Among the extra expenses being added to Kohl’s accounting for the first three quarters of 2004 is $3 million in SG&A expenses per quarter and depreciation expenses of $1 million per quarter.
Gymboree will restate quarterly information filed in its 2004 fiscal year, and probably in prior periods, too, the retailer said.
Other retailers have had to restate earnings because of the SEC’s clarification. One of them is Toys “R” Us, which recently said it would restate some information going back to 2003 because of its lease accounting.