TSC Staff
TJX (TJX Quote - Cramer on TJX - Stock Picks) posted a slight drop in first-quarter earnings due to charges for a massive data break in its computers.
Earnings before the charge still fell slightly short of Wall Street's expectation, and shares of TJX were falling 4% in early trading Tuesday. The Framingham, Mass.-based owner of the T.J. Maxx and Marshalls chains said its first-quarter income slipped to $162.1 million from $163.8 million a year earlier, while earnings per share were flat at 34 cents. The results included a $12 million charge for the hacking incident, which was first disclosed in January. Excluding the charge, earnings were 37 cents a share. Analysts, on average, projected EPS of 38 cents, according to Thomson Financial. Sales increased to $4.11 billion from $3.87 billion, slightly shy of Wall Street's forecast of $4.16 billion. Same-store sales, or sales at stores open at least a year, rose 2%. TJX said the same-store sales were slightly below its plan, which the company attributed to unseasonably cold and wet weather in March and early April. The retailer said, however, that it was able to meet its earnings forecasts due to expense control. Still, gross profit margins slipped 0.4 percentage points to 24.1% due to slightly higher markdowns. "Business trends were strong as we exited the quarter, and we are positioned extremely well to take advantage of the abundant off-price buying opportunities in spring apparel and other categories currently in the marketplace," said President and CEO Carol Meyrowitz in a statement. "Further, we have many merchandise initiatives underway to drive sales as we move forward." For the second quarter, TJX projected earnings of 32 cents to 34 cents a share, before a 2-cent charge related to the hackers. Wall Street expects earnings of 34 cents a share. TJX also backed its guidance for full-year earnings from continuing operations of $1.80 to $1.85 a share, in line with analysts' forecast of $1.84. Shares of TJX were off $1.15 to $27.22 in premarket trading.
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