Framingham, Mass. – TJX Cos. cut its full-year forecast today amid softer sales, but struck a bullish tone about buying plans and the overall business.
“We are in terrific inventory position, and we have plenty of open-to-buy to take advantage of the current environment,” company president and CEO Ernie Herrman told investors during this morning’s quarterly call.
Same-store sales at HomeGoods fell 13% as sales declined 11% to $18.6 billion during the quarter. However, Hermann said, inventories are “very clean,” and the team there has significant open-to-buy.
The 3 key takeaways about the company’s plans for home:
- Over the next few weeks, HomeGoods plans to buy 4 million units that will begin flowing into stores in September. Buyers will focus on the categories that are generating the best performance, he said, although he did not provide specifics.
- At the Marmaxx division, home comp was down by low teens on top of a 37% spike last year. Apparel now accounts for roughly 5% more of the mix, but home still has a bigger place in the assortment than it did in 2020.
- The consumer pull-back in home spending has been factored into go-forward planning at the company, and some funding has shifted from HomeGoods to Marmaxx.
TJX plans to resume its store remodeling program “very aggressively,” said Hermman, and is beginning to roll out a new Marshalls prototype.
“There’s an opportunity for us to get more brick and mortar share from the other brick and mortar out there,” he added.
Total net sales for the second quarter ended July 30 declined 2% to $11.8 billion. U.S. comp store sales fells 5% versus a 21% increase in U.S. open-only comp store sales in the year-ago quarter. Net income rose 3% to $809 million, or $.69 per diluted share.
TJX Cos. now expects full-year comp in the U.S. to decline 2% to 3%. Previously, it forecast a 1% to 2% comp increase. Adjusted per-share earnings are now expected to land in the $3.05 to $3.13 range, compared with the prior forecast of $3.13 to $3.20.