TJX Companies Inc. (TJX) announced strong financial results for the first-quarter, helped by heavy discounts that pulled more shoppers towards its store.
People have started buying stuff online and this changing consumer behavior has hurt many traditional brick-and-mortar stores. Though, unlike those retailers, TJX has not experienced store closures and big cuts in inventory.
The Massachusetts-based multinational off-price department store chain doesn’t advertise brands, instead it encourages customers to find deals on brands and items, through a treasure hunt, that are usually out of their range under normal circumstances.
TJX sometimes provides coats and apparel from famous brands like Versace and Michael Kors at half price as compared to other vendors.
The company said that its comparable store sales jumped 3 percent in the first quarter, as compared to a 2.5 percent surge estimated by analysts.
Overall, TJX reported net income of $716.4 million, or $1.13 a share for the three-month period ended May 5, up 33.6 percent from the comparable period last year.
Revenue for the quarter came in at $8.69 billion, representing a rise of 11.6 percent as compared to same quarter last year. Analysts on average were looking for revenue of $8.47 billion.
The company also lifted its adjusted earnings outlook for the full year. It now expects adjusted profit in a range of $4.04 a share to $4.10 a share, versus its earlier projection in between $4.00 a share and $4.08 a share.
TJX shares rose more than 3 percent in the mid-day trading on Tuesday following the results.
The company’s President and CEO Ernie Herrman said TJX is very pleased with its first quarter results as both its profit and comparable store sales surpassed its forecast. TJX will keep gaining market share and continue to grow successfully across the globe, he added.