TJX 1Q profit climbs 8 percent as sales improve

NEW YORK — TJX Cos. said Tuesday that its fiscal first-quarter profit rose 8 percent as budget-conscious shoppers taking advantage of bargains at its discount retail outlets helped boost sales.

The operator of stores such as T.J. Maxx, Marshalls and HomeGoods also expects to meet or beat Wall Street's second-quarter profit expectations.

Its shares rose $1.09, or 3.9 percent, to close at $29.03 Tuesday.

The Framingham, Mass.-based company said earnings climbed to $209.2 million, or 49 cents per share, for the period ended May 2, up from $193.8 million, or 43 cents per share, a year ago.

The latest results met the expectations of analysts polled by Thomson Reuters. Analysts' estimates typically exclude one-time items.

While the recession prompted shoppers to hit some of TJX's stores in search of better values, President and Chief Executive Carol Meyrowitz also credited the company's conservative same-store sales plans, tight inventory management and cost control efforts with helping its quarterly results.

"While we are pleased with our above-plan start to the year, we remain cautious in our near-term outlook and are maintaining our conservative approach, as the economic environment remains uncertain," she said in a statement.

Sales edged up 1 percent to $4.35 billion from $4.3 billion, which topped Wall Street's forecast of $4.32 billion.

Among its stronger performers were A.J. Wright in the U.S., T.K. Maxx in Germany and HomeSense in the U.K.

The minimal sales growth was due in part to the stronger dollar, which combined with mark-to-market adjustments on inventory-related hedges, lowered earnings by 4 cents per share.

Sales at stores open at least a year, known as same-store sales, increased 2 percent.

Same-store sales are a key indicator of retailer performance since they measure growth at existing stores rather than newly opened ones.

TJX expects second-quarter earnings of 43 cents to 49 cents per share. The forecast assumes same-store sales will be flat or drop 2 percent.

Analysts predict profit of 43 cents per share.

TJX added 28 stores in the first quarter. It currently runs 882 T.J. Maxx, 809 Marshalls, 322 HomeGoods and 140 A.J. Wright stores in the U.S. The company has 203 Winners, 75 HomeSense and 3 StyleSense stores in Canada and 238 T.K. Maxx and 8 HomeSense stores in Europe.