TJX touted a strong third quarter, as consolidated company comparable store sales advanced 7%, but earnings, although up, fell short of Wall Street expectations.
The company posted net income of $762.3 million, or 61 cents per diluted share, for the third quarter versus $641.4 million, or 50 cents per diluted share, in the year-prior period.
With a benefit due from the 2017 Tax Cuts and Jobs Act and a negative impact from a pension settlement charge considered, adjusted diluted earnings per share for the third quarter were 54 cents. Diluted earnings per share fell short of the 61 cent analyst consensus estimate published by MarketBeat.
The 7% consolidated comparable store sales advance derived from a 9% comp gain at the Marmaxx group, consisting of T.J. Maxx and Marshalls as well as Sierra Trading Post, a 7% comp gain at HomeGoods, a 5% comp gain at TJX Canada and a 3% comp gain at TJX International, consisting of operations in Europe and Australia.
Net sales for the third quarter increased 12% versus the year-previous period to $9.83 billion.
During the quarter, TJX stated, increased freight costs, expenses associated with supply chain, and an unfavorable year-over-year comparison related to inventory hedges hit results.
Ernie Herrman, TJX CEO and president, said, “We are extremely pleased with our strong third quarter results as both sales and earnings exceeded our expectations. Consolidated comparable store sales grew 7%, and we are especially pleased that this was driven by strong customer traffic at every division.”
Herrman added, “Marmaxx, our largest division, delivered an outstanding 9% comparable store sales increase, and this marks the 17th consecutive quarter that customer traffic was up at TJX and Marmaxx. Across our geographies, customers responded to our great merchandise and great values, as we believe we continued to capture market share. We also saw continued strength in our apparel businesses. With our very strong third quarter results, we are updating our full-year outlook for sales and earnings per share. The fourth quarter is off to a solid start, and we have many initiatives planned to keep driving traffic and sales this holiday season and beyond. We are excited about our focus on gifting and our marketing campaigns. We are well positioned to capitalize on the plentiful buying opportunities we see in the marketplace and ship fresh merchandise assortments throughout the quarter.”