T.J. Maxx owner results miss estimates due to Omicron-led store closures
Reuters
Published Feb 23, 2022 07:36AM ET
Updated Feb 23, 2022 10:06AM ET
(Reuters) -TJX Cos Inc missed Wall Street estimates for quarterly results on Wednesday, hit by temporary store closures and fewer customers visiting its outlets due to a surge in cases of the Omicron variant during the holiday season.
Shares of the company, which owns T.J. Maxx, fell about 6% to $61.43 after the retailer also reported lower profit margins as a result of higher freight costs.
Many U.S. companies, including TJX (NYSE:TJX) and its off-price rivals Ross Stores (NASDAQ:ROST) and Burlington Stores (NYSE:BURL), have been grappling with global supply chains disruptions due to shipping logjams, product shortages and cost inflation.
That has made it hard for retailers to keep their shelves stocked and forced them to spend heavily on transportation and higher wages.
TJX forecast earnings per share to be in the range of 58 cents to 61 cents in the current quarter, largely below analysts' expectations of 60 cents, according to Refinitiv IBES data.
The company also projects U.S. comparable sales to grow between 1% and 3% in the first quarter.
In the holiday quarter, the company's net sales rose nearly 27% to $13.85 billion, missing estimates of $14.22 billion.
Excluding items, it earned 78 cents per share in the fourth quarter, missing estimates of 91 cents.
TJX said store closures due to COVID-19 restrictions may have resulted in about $1.45 billion to $1.61 billion in lost sales through the past year, although it added that sales during the holiday season were trending higher before the spread of Omicron cases.
The sales were strong but not as robust as some other apparel retailers from whom TJX has been taking market share for years, Edward Jones analyst Brian Yarbrough said.
This month, U.S. department store chain Macy's Inc (NYSE:M) and retailer Walmart (NYSE:WMT) Inc reported better-than-expected quarterly sales and forecast strong sales for the year.
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Written By: Reuters
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