TJX (NYSE:TJX) has defied the negative trends plaguing many large retailers – including Macy's and Nordstrom – by reporting strong sales and growth for the first quarter and a plan to increase its store base by 50 percent.
Same-store sales for all banners increased 7 percent – the 29th consecutive quarter of comp store growth. Both net sales and earnings per share were up 10 percent.
E-commerce is growing at TJX, but is still a small component. "We see it as highly complementary to our physical stores," said Ernie Herrman, president and CEO. "We are being methodical in how we grow this business. We view e-commerce as another great avenue for driving traffic both online and to our stores and growing our retail brands."
"Our first quarter results continue our long track record of achieving comp sales increases in many types of retail environments, economies and geographies. We are convinced that we are growing our customer base and gaining market share."
Internal research shows that customer traffic increases are being driven by both new shoppers and existing ones shopping more often, Herrman said.
And stores are where the focus is.
The company sees the potential to grow to 5,600 locations with existing banners HomeGoods, Marshalls and TJ Maxx. That's more than 50 percent more stores, or 2,000 additional units over the long term.
Roughly 195 new stores are planned for 2016 and another 240 locations will be remodeled.
Off-price retailers are growing at a faster rate than traditional big box and department store chains. TJX is leading the way, even as others develop and grow new formats such as Macy's Backstage, Nordstrom Rack and Saks Off 5th to compete. Even Kohl's is developing an off-price format.
- see this earnings call transcript at Seeking Alpha
- see this financial release