As a result, the company, which operates T.J. Maxx and Marshalls, also raised its earnings forecast for its full fiscal year.
For the quarter ended July 30, the company’s net income rose 14% to $348.34 million, or 90 cents a share from $304.98 million, or 74 cents a share. The company’s European operations staged a recovery, more than tripling their net profit to $7.3 million.
On average, 23 analysts polled by Thomson Reuters expected the company to earn $0.89 per share for the quarter. Analysts’ estimates typically exclude one-time items. opping the $5.45 billion expe
Net sales increased 8% to $5.47 billion from $5.07 billion in the same quarter last year. Total comparable store sales increased 4% on top of a 3% gain a year ago.
The results were better than retail analysts’ average estimated that expected earnings of 89 cents a share on sales of $5.45 billion.
‘Large Increases in Customer Traffic’
Gross profit margin was up 0.7% to 27.3 percent, up 0.7 attributed in part to buying and occupancy expense leverage.
Commening on the results, Carol Meyrowitz, ceo, said: “These results mark the sixth consecutive year of very strong second quarter operating performance. We believe that this speaks to the consistency of TJX and the great flexibility of our business model, which has enabled us to succeed year after year, through both strong and weak economic environments. Customer traffic continues to be up over large increases in the last two years, as our tremendous values attract new and loyal customers.”
The company, which had a 6% increase in first half sales $10.7 billion, increased its full year earnings forecast and now expects expects earnings of $3.89 to $3.97 a share on comparable store sales increases of 2% to 3%. Analysts’ average estimates expects earnings of $3.95.
Meyrowitz said the company continues to see opportunites in the second half despite economic uncertainty. “In addition, we will be significantly increasing our marketing penetration in the second half of the year, leveraging our marketing spend, which we believe will also draw consumers to our stores.”
TJX stores have benefitted from value-conscious consumers who shopped there during the height of the recession and evidently remain.
“It is very important to note that we continue to achieve these strong results year after year in both good economic times and weak ones, which speaks to the consistency of our business model and our ability to sustain top and bottom line growth through all types of cycles,” Meyrowitz told analysts on a conference call. “Customer traffic continues to be up over significant increases last year, which tells us that our value continues to be as important as ever to the consumer.”