Saks 1st-qtr Loss Beats Forecast; TJX Posts Profit

ANNE D'INNOCENZIO

NEW YORK (AP) — Saks Inc. said Tuesday that its cost cutting left it with a smaller loss than expected in the first quarter, but demand remains weak for its luxury offerings, while discounter TJX Cos. earned 8 percent more than a year earlier as frugal shoppers took advantage of bargains.

Saks, which operates Saks Fifth Avenue, reiterated its weak sales outlook and is pressing for more cuts as it navigates the recession. TJX, which operates TJ Maxx, Marshalls and HomeGoods, said its profit in the current quarter could beat Wall Street estimates.

TJX said it will open 85 new stores this year, 15 to 20 more than it originally planned and test the market in Poland by opening three new stores there later this year.

Saks shares rose 21 percent, or 87 cents, to $4.95 on Tuesday as investors were encouraged by the smaller-than-expected loss, while shares of Framingham, Mass.-based TJX increased 4 percent, or $1.12, to $29.06.

"Saks and TJX are the perfect metaphor of what has been going on in the market for the last year," said Ken Perkins, president of RetailMetrics LLC. "Consumers are focusing on necessities and value.... It makes no sense to go to Saks or Neiman Marcus to pay top dollar for a brand name in this environment."