THE TJX COMPANIES The Thirteen Weeks (third quarter) and Thirty-Nine Weeks (nine months) Ended
October 30, 2021 Compared to
The Thirteen Weeks (third quarter) and Thirty-Nine Weeks (nine months) Ended
October 31, 2020
OVERVIEW
We are the leading off-price apparel and home fashions retailer in theU.S. and worldwide. Our mission is to deliver great value to our customers every day. We do this by selling a rapidly changing assortment of apparel, home fashions and other merchandise at prices generally 20% to 60% below full-price retailers' (including department, specialty, and major online retailers) regular prices on comparable merchandise, every day through our stores and five distinctive branded e-commerce sites. We operate nearly 4,700 stores through our four main segments: in theU.S. , Marmaxx (which operates T.J. Maxx, Marshalls, tjmaxx.com and marshalls.com) andHomeGoods (which operatesHomeGoods , Homesense, and homegoods.com); TJX Canada (which operates Winners, HomeSense and Marshalls inCanada ); andTJX International (which operatesT.K. Maxx , Homesense and tkmaxx.com inEurope , andT.K. Maxx inAustralia ). In addition to our four main segments, Sierra operates sierra.com and retail stores in theU.S. The results of Sierra are included in the Marmaxx segment. RESULTS OF OPERATIONS The novel coronavirus disease ("COVID-19") continues to impact our financial results. During the first nine months of fiscal 2022, our stores inthe United States remained open for the entire period. Stores were temporarily closed for approximately 1% of the third quarter due to temporary closures inAustralia and 6% of the first nine months of fiscal 2022, due to temporary closures inEurope ,Canada andAustralia . Stores were temporarily closed for approximately 1% of the third quarter of fiscal 2021 due to temporary closures inEurope andAustralia and for approximately 27% of the first nine months of fiscal 2021 due to temporary closures across all geographies. Overall, our third quarter and first nine months results for fiscal 2022 were significantly better than our results for the same periods of fiscal 2021. In addition to comparing current year results to fiscal 2021, we may, where meaningful, also compare these results to a comparable period in the fiscal year endedFebruary 1, 2020 ("fiscal 2020"), prior to the emergence of the pandemic. Although we are not fully past the negative impacts of the pandemic, we believe this additional comparison provides insight into how we are managing the business and performing as compared to our pre-pandemic results. Overview of our financial performance for the quarter endedOctober 30, 2021 includes the following: -Net sales were$12.5 billion ,$10.1 billion and$10.5 billion for the third quarter of fiscal 2022, fiscal 2021 and fiscal 2020, respectively. As ofOctober 30, 2021 , the number of stores in operation (including stores that had been or continue to be temporarily closed due to COVID-19) increased 2% and selling square footage increased 2% compared to the end of the fiscal 2021 third quarter. -Diluted earnings per share were$0.84 ,$0.71 and$0.68 for the third quarter of fiscal 2022, fiscal 2021 and fiscal 2020, respectively. -Pre-tax margin (the ratio of pre-tax income to net sales) was 11.0%, 10.0% and 10.7% for the third quarter of fiscal 2022, fiscal 2021 and fiscal 2020, respectively. -Our cost of sales, including buying and occupancy costs, ratio was 70.5%, 69.8% and 71.2% for the third quarter of fiscal 2022, fiscal 2021 and fiscal 2020, respectively. -Our selling, general and administrative ("SG&A") expense ratio was 18.3%, 19.6% and 18.0% for the third quarter of fiscal 2022, fiscal 2021 and fiscal 2020, respectively. -Consolidated merchandise inventories as of the end of the third quarter of fiscal 2022 increased 33% compared to the third quarter of fiscal 2021 and increased 6% compared to the third quarter of fiscal 2020. On a constant currency basis, consolidated merchandise inventories as of the end of the third quarter of fiscal 2022 increased 31% compared to the third quarter of fiscal 2021 and increased 4% compared to the third quarter of fiscal 2020. -During the third quarter of fiscal 2022, we returned$1.1 billion to our shareholders through share repurchases and dividends. 22 -------------------------------------------------------------------------------- Operating Results as a Percentage ofNet Sales The following table sets forth certain information about our operating results as a percentage of net sales for the following periods: Thirteen Weeks Ended Thirty-Nine Weeks Ended October 30, October 31, November 2, October 30, October 31, November 2, 2021 2020 2019 2021 2020 2019 Net sales 100.0 % 100.0 % 100.0 % 100.0 % 100.0 % 100.0 % Cost of sales, including buying and occupancy costs 70.5 69.8 71.2 71.0 78.6
71.5
Selling, general and administrative expenses 18.3 19.6 18.0 19.0 22.8
18.0
Loss on early extinguishment of debt - - - 0.7 - - Interest expense, net 0.2 0.5 - 0.3 0.6 - Income (loss) before provision for income taxes* 11.0 % 10.0 % 10.7 % 9.1 % (2.0) % 10.4 % *Figures may not foot due to rounding. Recent Events and Trends COVID-19 COVID-19 was identified inDecember 2019 before spreading worldwide and being declared a pandemic by theWorld Health Organization inMarch 2020 . In response to the COVID-19 pandemic, we temporarily closed all of our stores, online businesses, distribution centers and offices inMarch 2020 , with Associates working remotely where possible. Upon reopening stores and distribution centers inMay 2020 , we implemented new health and safety practices, including practices related to personal protective equipment, enhanced cleaning and social distancing protocols (which included occupancy limits and reducing in-store inventory levels). In response to the pandemic, primarily during the first quarter of fiscal 2021, we took several steps to strengthen our financial position and balance sheet and to maintain financial liquidity and flexibility. In response to increasing cases of COVID-19 and due to government mandates, hundreds of stores located inCanada ,Australia andEurope had additional temporary closures during fiscal 2022, and many additional stores, while open, were operating with stringent COVID-19-related occupancy restrictions, negatively impacting our results during the third quarter and first nine months of fiscal 2022.
The below table represents total store days closed due to the COVID-19 pandemic as a percentage of potential total store days open in the third quarter and first nine months of fiscal 2022 and fiscal 2021 by segment.
Thirteen Weeks Ended Thirty-Nine Weeks Ended
October 30, October 31, October 30, October 31,
2021 2020 2021 2020
Marmaxx - % - % - % 27 %
HomeGoods - % - % - % 27 %
TJX Canada - % - % 16 % 27 %
TJX International 5 % 3 % 26 % 29 %
TJX Consolidated 1 % 1 % 6 % 27 %
All of our e-commerce businesses remained open throughout the first nine months
of fiscal 2022. We continue to monitor developments, including government
requirements and recommendations at the national, state, and local level that
could result in possible additional impacts to our operations.
Impact of Brexit
On December 24, 2020 the U.K. and EU agreed upon the terms of their future
trading relationship. As expected, the movement of goods between the U.K. and EU
is subject to additional regulatory and compliance requirements, which has had,
and is expected to continue to have, a negative impact on our ability to
efficiently move merchandise in the region. We have realigned our European
division's supply chain to reduce the volume of merchandise flowing between the
U.K. and the EU and have established resources and systems to support this plan.
23
--------------------------------------------------------------------------------
The new trade deal provides for zero customs duties and zero quotas on trade
between the U.K. and the EU in goods that are produced in each of the U.K. and
the EU. However, a portion of the merchandise we source in the U.K. and the EU
is produced somewhere else in the world, and therefore is subject to additional
customs duty costs under the new trade deal. These additional customs duties and
the related operational costs have impacted the profitability of our European
division, and may continue to do so, at least in the short term.
New immigration requirements between the U.K. and EU countries may also have a
negative impact on our ability to recruit and retain current and future talent
in the region. In addition to these operational impacts, factors including
changes in legislation, consumer confidence and behavior, economic conditions,
interest rates and foreign currency exchange rates could result in a significant
financial impact to our European operations, particularly in the short term.
Net Sales
Net sales totaled $12.5 billion , $10.1 billion and $10.5 billion for the third
quarters of fiscal 2022, fiscal 2021 and fiscal 2020, respectively. Net sales
from our e-commerce businesses combined amounted to less than 3% of total sales
for the third quarters of fiscal 2022, fiscal 2021 and fiscal 2020.
Net sales totaled $34.7 billion , $21.2 billion and $29.5 billion for the first
nine months of fiscal 2022, fiscal 2021 and fiscal 2020, respectively. Net sales
from our e-commerce businesses combined amounted to less than 3% of total sales
for the first nine months of fiscal 2022, fiscal 2021 and fiscal 2020.
As a result of the extensive temporary store closures during fiscal 2021 due to
the COVID-19 pandemic and our practice relating to the treatment of extended
temporary store closures when calculating comp store sales, we had no stores
classified as comp stores at the end of the third quarters of fiscal 2022 and
fiscal 2021. Our historical definition of comp store sales is presented below
for reference.
Open-Only Comp Store Sales
In order to provide a performance indicator for our stores as they reopened,
since the second quarter of fiscal 2021, we have been temporarily reporting a
new sales measure, open-only comp store sales. Open-only comp store sales
includes stores initially classified as comp stores at the beginning of fiscal
2021 that had to temporarily close due to the COVID-19 pandemic. For the third
quarter and first nine months of fiscal 2022, this measure reports the sales
increase or decrease of these stores for the days the stores were open in the
current period against sales for the same days in fiscal 2020, prior to the
pandemic. Open-only comp store sales of our foreign segments are calculated by
translating the current year using the third quarter and the first nine months
of fiscal 2020's exchange rates.
We define customer traffic to be the number of transactions in stores and
average ticket to be the average retail price of the units sold. We define
average transaction or average basket to be the average dollar value of
transactions.
Fiscal 2022 vs Fiscal 2021
Net sales increased 24% in the third quarter of fiscal 2022 compared to the
third quarter of fiscal 2021 primarily due to an increase in customer traffic.
Net sales increased 64% for the first nine months of fiscal 2022 compared to the
first nine months of fiscal 2021. This increase reflects the temporary closures
of all our stores and online businesses during portions of the first nine months
of fiscal 2021 as a result of the COVID-19 pandemic. Stores were closed for
approximately 6% of the first nine months of fiscal 2022, due to temporary store
closures in Europe , Canada and Australia , as compared to stores across all
geographies being temporarily closed for approximately 27% of the first nine
months of fiscal 2021.
Fiscal 2022 vs Fiscal 2020
Net sales increased 20% and open-only comp store sales were up 14% for the third
quarter of fiscal 2022 compared to the third quarter of fiscal 2020. Net sales
increased 18% and open-only comp store sales were up 17% for the first nine
months fiscal 2022 compared to the first nine months of fiscal 2020. These
reflect an increase in average basket across all divisions for both periods.
Customer traffic was up in the U.S. , where stores were open for the entire third
quarter and the first nine months of fiscal 2022, and was down in geographies
where we had temporary store closures or stores operating under COVID-19-related
occupancy restrictions. While our open-only comp store sales in home fashions
continued to significantly exceed those of apparel, we had strong positive
open-only comp store sales in apparel during the quarter and first nine months
of fiscal 2022 compared to the same periods in fiscal 2020.
24
--------------------------------------------------------------------------------
Historical Definition of Comp Store Sales
We are temporarily reporting a new sales measure, open-only comp store sales, as
described above. The following reflects the way that we have historically
classified and reported comp sales results.
Historically, we defined comparable store sales, or comp sales, to be sales of
stores that have been in operation for all or a portion of two consecutive
fiscal years, or in other words, stores that are starting their third fiscal
year of operation. We calculated comp sales on a 52-week basis by comparing the
current and prior year weekly periods that are most closely aligned. Relocated
stores and stores that have changed in size are generally classified in the same
way as the original store, and we believe that the impact of these stores on the
consolidated comp percentage is immaterial.
Sales excluded from comp sales ("non-comp sales") consist of sales from:
-New stores - stores that have not yet met the comp sales criteria, which
represents a substantial majority of non-comp sales
-Stores that are closed permanently or for an extended period of time
-Sales from our e-commerce sites, meaning sierra.com, tjmaxx.com, marshalls.com,
tkmaxx.com and homegoods.com
We determine which stores are included in the comp sales calculation at the
beginning of a fiscal year and the classification remains constant throughout
that year unless a store is closed permanently or for an extended period during
that fiscal year. Beginning in fiscal 2020, Sierra stores that fit the comp
store definition were included in comp stores in our Marmaxx segment.
Comp sales of our foreign segments are calculated by translating the current
year's comp sales using the prior year's exchange rates. This removes the effect
of changes in currency exchange rates, which we believe is a more accurate
measure of segment operating performance.
Comp sales may be referred to as "same store" sales by other retail companies.
The method for calculating comp sales varies across the retail industry,
therefore our measure of comp sales may not be comparable to that of other
retail companies.
Impact of Foreign Currency Exchange Rates
Our operating results are affected by foreign currency exchange rates as a
result of changes in the value of the U.S. dollar or a division's local currency
in relation to other currencies. We specifically refer to "foreign currency" as
the impact of translational foreign currency exchange and mark-to-market of
inventory derivatives, as described in detail below. This does not include the
impact foreign currency exchange rates can have on various transactions that are
denominated in a currency other than an operating division's local currency
referred to as "transactional foreign exchange," also described below.
Translation Foreign Exchange
In our financial statements, we translate the operations of TJX Canada and TJX
International from local currencies into U.S. dollars using currency rates in
effect at different points in time. Significant changes in foreign exchange
rates between comparable prior periods can result in meaningful variations in
net sales, net income (loss) and earnings (loss) per share growth as well as the
net sales and operating results of these segments. Currency translation
generally does not affect operating margins, or affects them only slightly, as
sales and expenses of the foreign operations are translated at approximately the
same rates within a given period.
Mark-to-Market Inventory Derivatives
We routinely enter into inventory-related hedging instruments to mitigate the
impact on earnings of changes in foreign currency exchange rates on merchandise
purchases denominated in currencies other than the local currencies of our
divisions, principally TJX Canada and TJX International . As we have not elected
"hedge accounting" for these instruments, as defined by U.S. generally accepted
accounting principles ("GAAP"), we record a mark-to-market gain or loss on the
derivative instruments in our results of operations at the end of each reporting
period. In subsequent periods, the income (loss) statement impact of the
mark-to-market adjustment is effectively offset when the inventory being hedged
is received and paid for. While these effects occur every reporting period, they
are of much greater magnitude when there are sudden and significant changes in
currency exchange rates during a short period of time. The mark-to-market
adjustment on these derivatives does not affect net sales, but it does affect
the cost of sales, operating margins and earnings we report.
Transactional Foreign Exchange
When discussing the impact on our results of the effect of foreign currency
exchange rates on certain transactions, we refer to it as "transactional foreign
exchange". This primarily includes the impact that foreign currency exchange
rates may have on the year-over-year comparison of merchandise margin as well as
"foreign currency gains and losses" on transactions that are denominated in a
currency other than the operating division's local currency. These two items can
impact segment margin comparison of our foreign divisions and we have
highlighted them when they are meaningful to understanding operating trends.
25
--------------------------------------------------------------------------------
Cost of Sales, Including Buying and Occupancy Costs
Cost of sales, including buying and occupancy costs, was $8.8 billion , or 70.5%
of net sales, $7.1 billion , or 69.8% of net sales and $7.4 billion , or 71.2% of
net sales for the third quarters of fiscal 2022, fiscal 2021 and fiscal 2020,
respectively.
Cost of sales, including buying and occupancy costs, was $24.6 billion or 71.0%
of net sales, $16.7 billion , or 78.6% of net sales and $21.1 billion , or 71.5%
of net sales for the first nine months of fiscal 2022, fiscal 2021 and fiscal
2020, respectively.
Fiscal 2022 vs Fiscal 2021
The increase in the total cost of sales, including buying and occupancy costs,
was primarily attributable to the additional cost of merchandise sold due to a
higher level of sales in the third quarter of fiscal 2022 compared to fiscal
2021. In addition, the third quarter of fiscal 2022 reflects higher supply chain
costs, which were due to additional investments in distribution capacity and
higher wages, as well as higher freight costs, which are both expected to
continue into the next fiscal year.
The increase in the total cost of sales, including buying and occupancy costs,
for the first nine months of fiscal 2022 was primarily due to the additional
cost of merchandise sold due to a higher level of sales compared to fiscal 2021.
Our stores were temporarily closed in the aggregate for approximately 6% of the
first nine months of fiscal 2022 and approximately 27% of the first nine months
of fiscal 2021. Merchandise margin significantly improved during the first nine
months of fiscal 2022, primarily driven by favorable markdowns, which were
partially offset by increased freight costs. In addition, supply chain costs
increased due to additional investments in distribution capacity and higher
wages, which, along with freight costs, are expected to continue into the next
fiscal year.
Cost of sales, including buying and occupancy costs, was favorably impacted by
approximately $2 million and $4 million of government programs for the third
quarters of fiscal 2022 and fiscal 2021, respectively, as well as $25 million
and $67 million of government programs for the first nine months of fiscal 2022
and fiscal 2021, respectively, in regions where we had temporary store closures.
Fiscal 2022 vs Fiscal 2020
The expense ratios decreased 0.7% for the third quarter of fiscal 2022 and 0.5%
for the first nine months of fiscal 2022 compared to the same periods of fiscal
2020. The decreases reflect the leverage on our occupancy costs due to the
strong open-only comp store sales growth as well as improved merchandise margin.
Within merchandise margin, strong markon and lower markdowns collectively more
than offset 1.6 percentage points of incremental freight costs in the third
quarter of fiscal 2022. In addition, the expense ratio decreases were partially
offset by higher supply chain costs primarily due to additional investments in
distribution capacity and higher wages.
Selling, General and Administrative Expenses
SG&A expenses were $2.3 billion , or 18.3% of net sales, $2.0 billion , or 19.6%
of net sales and $1.9 billion , or 18.0% of net sales for the third quarters of
fiscal 2022, fiscal 2021 and fiscal 2020, respectively.
SG&A expenses were $6.6 billion , or 19.0% of net sales, $4.8 billion , or 22.8%
of net sales and $5.3 billion , or 18.0% of net sales for the first nine months
of fiscal 2022, fiscal 2021 and fiscal 2020, respectively.
Fiscal 2022 vs Fiscal 2021
The increases in SG&A expenses for both the third quarter and the first nine
months of fiscal 2022 compared to the same periods of fiscal 2021 were primarily
driven by higher store payroll costs to support a higher sales volume. In
addition to these costs, incentive compensation costs and other variable store
costs, such as advertising spend and credit processing fees, were higher in
fiscal 2022 as compared to the third quarter and the first nine months of fiscal
2021.
SG&A expenses were favorably impacted by $9 million and $29 million from
government programs for the third quarter of fiscal 2022 and fiscal 2021,
respectively, as well as $215 million and $377 million from government programs
for the first nine months of fiscal 2022 and fiscal 2021, respectively, in
regions where we had temporary store closures.
Fiscal 2022 vs Fiscal 2020
The expense ratios increased 0.3% for the third quarter of fiscal 2022 and 1.0%
for the first nine months of fiscal 2022 compared to the same periods of fiscal
2020. The increases for both periods were driven by higher store payroll costs,
primarily due to incremental COVID-19 related payroll costs and higher incentive
compensation accruals. These costs were partially offset by credits received
from government programs in fiscal 2022.
26
--------------------------------------------------------------------------------
Loss On Early Extinguishment of Debt
On June 4, 2021 , we completed make-whole calls for our $1.25 billion aggregate
principal amount of 3.50% Notes maturing in 2025 and our $750 million aggregate
principal amount of 3.75% Notes maturing in 2027. As a result of these
redemptions prior to their scheduled maturities, we recorded a pre-tax debt
extinguishment charge of $242 million in the second quarter of fiscal 2022. For
additional information on the debt transactions, see Note I-Long-Term Debt and
Credit Lines of Notes to Consolidated Financial Statements.
Interest Expense, net
The components of interest expense, net are summarized below:
Thirty-Nine Weeks
Thirteen Weeks Ended Ended
October 30, October 31, October 30, October 31,
In millions 2021 2020 2021 2020
Interest expense $ 22.9 $ 55.8 $ 100.3 $ 148.6
Capitalized interest (0.8) (1.6) (2.6) (3.8)
Interest (income) (1.4) (1.3) (3.7) (11.2)
Interest expense, net $ 20.7 $ 52.9 $ 94.0 $ 133.6
Net interest expense decreased for both the third quarter of fiscal 2022 and the
nine months ended October 30, 2021 compared to the same periods in fiscal 2021,
primarily due to the prior year's refinancing of certain notes in December 2020
as well as the $2.75 billion pay down of outstanding debt during the first nine
months of fiscal 2022.
Provision for Income Taxes
The effective income tax rate was 25.8%, 14.7% and 26.2% for the third quarters
of fiscal 2022, fiscal 2021 and fiscal 2020, respectively. The increase in the
third quarter effective income tax rate is primarily due to a benefit of the
jurisdictional mix of profits and losses, and the better than anticipated
results, as of the third quarter of fiscal 2021.
The effective income tax rate was 25.7%, 43.9% and 25.7% for the first nine
months of fiscal 2022, fiscal 2021 and fiscal 2020, respectively. The decrease
in the first nine months effective income tax rate of fiscal 2022 was primarily
due to the significant increase in profit through the third quarter of fiscal
2022 as compared to the mix of income and losses by jurisdictions through the
third quarter of fiscal 2021.
Net Income / (Loss) and Diluted Earnings (Loss) Per Share
Net income was $1.0 billion , $0.9 billion and $0.8 billion for the third
quarters of fiscal 2022, fiscal 2021 and fiscal 2020, respectively. Net income
(loss) was $2.3 billion , $(0.2) billion and $2.3 billion for the first nine
months of fiscal 2022, fiscal 2021 and fiscal 2020, respectively.
Net income per diluted share was $0.84 , $0.71 and $0.68 for the third quarters
of fiscal 2022, fiscal 2021 and fiscal 2020, respectively. Net income (loss) per
diluted share was $1.92 , which included a second quarter debt extinguishment
charge of $0.15 , $(0.20) and $1.86 for the first nine months of fiscal 2022,
fiscal 2021 and fiscal 2020, respectively.
27
--------------------------------------------------------------------------------
Segment Information
We operate four main business segments. Our Marmaxx segment (T.J. Maxx,
Marshalls, tjmaxx.com and marshalls.com) and our HomeGoods segment (HomeGoods ,
Homesense and homegoods.com) both operate in the United States . Our TJX Canada
segment operates Winners, HomeSense and Marshalls in Canada , and our TJX
International segment operates T.K. Maxx , Homesense and tkmaxx.com in Europe and
T.K. Maxx in Australia . In addition to our four main segments, Sierra operates
sierra.com and retail stores in the U.S. The results of Sierra are included in
the Marmaxx segment.
We evaluate the performance of our segments based on "segment profit or loss,"
which we define as pre-tax income or loss before general corporate expense and
interest expense, net, and certain separately disclosed unusual or infrequent
items. "Segment profit or loss," as we define the term, may not be comparable to
similarly titled measures used by other companies. The terms "segment margin" or
"segment profit margin" are used to describe segment profit or loss as a
percentage of net sales. These measures of performance should not be considered
an alternative to net income or cash flows from operating activities as an
indicator of our performance or as a measure of liquidity.
Due to the temporary closing of stores as a result of the COVID-19 pandemic, our
historical definition of comp store sales is not applicable for the reported
periods. In order to provide a performance indicator for our stores as they
reopen, we have been temporarily reporting a new sales measure, open-only comp
store sales. Open-only comp store sales includes stores initially classified as
comp stores at the beginning of fiscal 2021 that had to temporarily close due to
the COVID-19 pandemic. This measure reports the sales increase or decrease of
these stores for the days the stores were open in the third quarter and first
nine months of fiscal 2022 against sales for the same days in fiscal 2020, prior
to the emergence of the pandemic.
When discussing current year segment results, in addition to comparing to fiscal
2021, we may, where meaningful, also compare these results to a comparable
period in fiscal 2020, prior to the emergence of the pandemic.
Presented below is selected financial information related to our business
segments.
28
--------------------------------------------------------------------------------U.S. SEGMENTS Marmaxx Thirteen Weeks Ended Thirty-Nine Weeks EndedOctober 30 ,October 31 ,
2021 2020 2019 2021 2020 2019
Net sales $ 7,214 $ 5,785 $ 6,354 $ 21,203 $ 12,442 $ 18,262
Segment profit $ 990 $ 665 $ 820 $ 2,829 $ 56 $ 2,472
Segment margin 13.7 % 11.5 % 12.9 % 13.3 % 0.4 % 13.5 %
Stores in operation at end of
period:
T.J. Maxx 1,285 1,272 1,271
Marshalls 1,148 1,134 1,125
Sierra 55 48 46
Total 2,488 2,454 2,442
Selling square footage at end of period (in thousands):
T.J. Maxx 27,905 27,732 27,728
Marshalls 26,185 25,955 25,820
Sierra 895 796 775
Total 54,985 54,483 54,323
Net Sales
Net sales for Marmaxx were $7.2 billion for the third quarter of fiscal 2022, an
increase of 25% compared to $5.8 billion for the third quarter of fiscal 2021.
Net sales were $21.2 billion for the first nine months of fiscal 2022, an
increase of 70% compared to $12.4 billion for the first nine months of fiscal
2021. The increase for the third quarter was primarily driven by an increase in
customer traffic. The increase for the first nine months reflected significant
temporary store closings during the first nine months of fiscal 2021. Stores
were closed for approximately 27% of the first nine months of fiscal 2021 as a
result of the COVID-19 pandemic.
Net sales increased 14% compared to $6.4 billion for the third quarter of fiscal
2020 and increased 16% compared to $18.3 billion for the first nine months of
fiscal 2020. Open-only comp store sales were up 11% for the third quarter of
fiscal 2022 and 14% for the first nine months of fiscal 2022 compared to the
same periods of fiscal 2020. The increases in open-only comp store sales for
both periods were primarily driven by an increase in average basket. While our
open-only comp store sales in home fashions continued to significantly exceed
those of apparel, we had strong positive open-only comp store sales in apparel
during the third quarter and first nine months of fiscal 2022.
Segment Profit
Fiscal 2022 vs Fiscal 2021
Segment profit was $990 million for the third quarter of fiscal 2022, an
increase of $325 million , compared to a segment profit of $665 million for the
third quarter of fiscal 2021. This increase was driven by additional sales,
resulting in an improved segment profit margin of 13.7% for the third quarter of
fiscal 2022 compared to 11.5% for the third quarter of fiscal 2021.
Segment profit was $2.8 billion for the first nine months of fiscal 2022, an
increase of $2.8 billion , compared to a segment profit of $56 million for the
first nine months of fiscal 2021. This increase was primarily driven by
increased sales due to the temporary store closures in the first nine months of
fiscal 2021. The first nine months of fiscal 2021 also benefited $171 million
from government programs.
Fiscal 2022 vs Fiscal 2020
Segment profit increased by $170 million compared to a segment profit of $820
million for the third quarter of fiscal 2020. Segment profit margin increased to
13.7% for the third quarter of fiscal 2022 compared to 12.9% for the third
quarter of fiscal 2020.
Segment profit increased by $357 million compared to a segment profit of $2.5
billion for the first nine months of fiscal 2020. Segment profit margin
decreased to 13.3% for the first nine months of fiscal 2022 compared to 13.5%
for the first nine months of fiscal 2020.
For both periods, segment profit margin reflected improved merchandise margin
and leverage on occupancy costs due to the strong open-only comp store sales
growth. Within merchandise margin, strong markon and lower markdowns
collectively more than offset incremental freight costs. These improvements were
partially offset in the third quarter and more than offset in the first nine
months of fiscal 2022 by incremental COVID-19 related store payroll costs and
higher supply chain costs.
Our Marmaxx e-commerce businesses, which represented less than 4% of Marmaxx's
net sales for each of the third quarter and the first nine months of fiscal
2022, fiscal 2021 and fiscal 2020, respectively, did not have a significant
impact on year-over-year segment margin comparisons for the third quarter and
the first nine months of fiscal 2022.
29
--------------------------------------------------------------------------------HomeGoods Thirteen Weeks Ended Thirty-Nine Weeks EndedOctober 30 ,October 31 ,
2021 2020 2019 2021 2020 2019
Net sales $ 2,254 $ 1,876 $
1,582
$ 263 $ 291 $ 173 $ 697 $ 235 $ 439 Segment margin 11.7 % 15.5 %
10.9 % 10.8 % 6.1 % 10.0 %
Stores in operation at end of period: HomeGoods 850 821 807 Homesense 39 34 32 Total 889 855 839 Selling square footage at end of period (in thousands): HomeGoods 15,550 15,034 14,792 Homesense 837 733 685 Total 16,387 15,767 15,477 Net Sales Net sales forHomeGoods were$2.3 billion for the third quarter of fiscal 2022, an increase of 20%, compared to$1.9 billion for the third quarter of fiscal 2021. The increase for the third quarter was primarily driven by an increase in customer traffic. Net sales were$6.5 billion for the first nine months of fiscal 2022, an increase of 67%, compared to$3.9 billion for the first nine months of fiscal 2021. The increase for the first nine months of fiscal 2022 reflected significant temporary store closings during the first nine months of fiscal 2021. Stores were temporarily closed for approximately 27% of the first nine months of fiscal 2021 as a result of the COVID-19 pandemic. Net sales increased 42% compared to$1.6 billion for the third quarter of fiscal 2020 and increased 47% compared to$4.4 billion for the first nine months of fiscal 2020. Open-only comp store sales were up 34% for the third quarter of fiscal 2022 and 36% for the first nine months of fiscal 2022 compared to the same periods of fiscal 2020. The increases in open-only comp store sales for both periods were driven by an increase in customer traffic and average basket. Segment Profit Fiscal 2022 vs Fiscal 2021 Segment profit was$263 million for the third quarter of fiscal 2022, a decrease of$28 million compared to a segment profit of$291 million for the third quarter of fiscal 2021. The decrease for the third quarter was due to lower merchandise margin primarily driven by increased freight costs and lower markon. Segment profit was$697 million for the first nine months of fiscal 2022, an increase of$462 million compared to a segment profit of$235 million for the first nine months of fiscal 2021. The increase for the first nine months of fiscal 2022 was primarily driven by increased sales due to the temporary store closures in the first nine months of fiscal 2021, partially offset by lower merchandise margin due to increased freight costs and lower markon. The first nine months of fiscal 2021 also benefited from$46 million of government programs. Fiscal 2022 vs Fiscal 2020 Segment profit increased by$90 million compared to a segment profit of$173 million for the third quarter of fiscal 2020. Segment profit margin increased to 11.7% for the third quarter of fiscal 2022 compared to 10.9% for the third quarter of fiscal 2020. The increase in segment profit margin was primarily driven by expense leverage on our occupancy and administrative costs due to the strong open-only comp store sales growth, partially offset by higher supply chain costs. Merchandise margin was up slightly with strong markon and lower markdowns mostly offset by incremental freight costs. Segment profit increased by$258 million compared to a segment profit of$439 million for the first nine months of fiscal 2020. Segment profit margin increased to 10.8% for the first nine months of fiscal 2022 compared to 10.0% for the first nine months of fiscal 2020. The increase in segment profit margin was primarily driven by the expense leverage on our occupancy and administrative costs due to the strong open-only comp store sales growth. This increase was partially offset by higher supply chain costs, incremental COVID-19 related store payroll costs and higher store wages, as well as lower merchandise margin. Within merchandise margin, incremental freight costs more than offset lower markdowns and strong markon. During the third quarter of fiscal 2022,HomeGoods made online shopping available at www.homegoods.com. 30 -------------------------------------------------------------------------------- FOREIGN SEGMENTS TJX Canada Thirteen Weeks Ended Thirty-Nine Weeks Ended October 30, October 31,
2021 2020 2019 2021 2020 2019
Net sales $ 1,301 $ 1,028 $
1,082
$ 169 $ 177 $ 170 $ 359 $ 101 $ 386 Segment margin 13.0 % 17.2 %
15.7 % 11.6 % 5.1 % 13.3 %
Stores in operation at end of period: Winners 292 280 279 HomeSense 147 143 136 Marshalls 106 102 97 Total 545 525 512 Selling square footage at end of period (in thousands): Winners 6,279 6,015 5,986 HomeSense 2,733 2,644 2,490 Marshalls 2,220 2,141 2,043 Total 11,232 10,800 10,519 Net Sales Net sales for TJX Canada were$1.3 billion for the third quarter of fiscal 2022, an increase of 27% compared to$1.0 billion for the third quarter of fiscal 2021. The increase for the third quarter was primarily driven by an increase in customer traffic and average basket. Net sales were$3.1 billion for the first nine months of fiscal 2022, an increase of 54% compared to$2.0 billion for the first nine months of fiscal 2021. The increase for the nine-month period reflected temporary store closings, which were approximately 16% of the first nine months of fiscal 2022, and 27% of the first nine months of fiscal 2021, as a result of the COVID-19 pandemic. Net sales for TJX Canada increased 20% compared to$1.1 billion for the third quarter of fiscal 2020 and increased 7% compared to$2.9 billion for the first nine months of fiscal 2020. On a constant currency basis, net sales increased 14% for the third quarter and 1% for the first nine months of fiscal 2022, respectively. Open-only comp store sales were up 8% for the third quarter of fiscal 2022 and up 11% for the first nine months of fiscal 2022 compared to the same periods of fiscal 2020. The increases in open-only comp store sales were driven by an increase in average basket, partially offset by reduced customer traffic. Segment Profit Fiscal 2022 vs Fiscal 2021 Segment profit was$169 million for the third quarter of fiscal 2022, a decrease of$8 million compared to a segment profit of$177 million for the third quarter of fiscal 2021. The decrease for the third quarter was primarily due to lower merchandise margin driven by higher freight costs, partially offset by improved markon. Segment profit was$359 million for the first nine months of fiscal 2022, an increase of$258 million compared to a segment profit of$101 million for the first nine months of fiscal 2021. The increase for the first nine months of fiscal 2022 was primarily driven by increased sales due to having fewer temporary store closures in fiscal 2022 compared to the same periods in fiscal 2021. The third quarter and the first nine months of fiscal 2022 also reflected$10 million and$84 million , respectively, of government programs compared to$27 million for the third quarter and$131 million for the first nine months of fiscal 2021. Fiscal 2022 vs Fiscal 2020 Segment profit was flat compared to the third quarter of fiscal 2020. Segment profit margin decreased to 13.0% for the third quarter of fiscal 2022 compared to 15.7% for the third quarter of fiscal 2020. The decrease in segment profit margin was primarily driven by higher supply chain costs, the unfavorable impact of the mark-to-market on inventory derivatives and incremental COVID-19 related costs. Merchandise margin improved due to higher markon and lower markdowns, mostly offset by incremental freight. The segment profit decrease was partially offset by expense leverage on our occupancy and administrative costs due to the strong open-only comp store sales growth. Segment profit decreased$27 million compared to a segment profit of$386 million for the first nine months of fiscal 2020. Segment profit margin decreased to 11.6% for the first nine months of fiscal 2022 compared to 13.3% for the same period of fiscal 2020. The decrease in segment profit margin was primarily driven by higher supply chain costs, incremental COVID-19 related costs, net of government programs, and higher incentive compensation costs. This was partially offset by improved merchandise margin, which reflected strong markon and lower markdowns that collectively offset incremental freight costs. 31 --------------------------------------------------------------------------------
Thirteen Weeks Ended Thirty-Nine Weeks Ended
October 30, October 31, November 2, October 30, October 31, November 2,
U.S. dollars in millions 2021 2020 2019 2021 2020 2019
Net sales $ 1,764 $ 1,429 $ 1,433 $ 3,926 $ 2,881 $ 3,947
Segment profit (loss) $ 127 $ 87 $ 99 $ 79 $ (303) $ 178
Segment margin 7.2 % 6.1 % 6.9 % 2.0 % (10.5) % 4.5 %
Stores in operation at end of period: T.K. Maxx 618 602 594 Homesense 78 78 78 T.K. Maxx Australia 66 60 54 Total 762 740 726 Selling square footage at end of period (in thousands): T.K. Maxx 12,412 12,131 11,999 Homesense 1,142 1,142 1,149 T.K. Maxx Australia 1,172 1,077 990 Total 14,726 14,350 14,138 Net Sales Net sales forTJX International were$1.8 billion for the third quarter of fiscal 2022, an increase of 23% compared to$1.4 billion for the third quarter of fiscal 2021. Net sales were$3.9 billion for the first nine months of fiscal 2022, an increase of 36% compared to$2.9 billion for the first nine months of fiscal 2021. The increase for the third quarter of fiscal 2022 was primarily driven by an increase in customer traffic and average basket. The increase for the nine-month period reflected temporary store closings, as a result of the COVID-19 pandemic, which were approximately 26% of the first nine months of fiscal 2022, and 29% of the first nine months of fiscal 2021. Net sales forTJX International increased 23% compared to$1.4 billion for the third quarter of fiscal 2020 and decreased 1% compared to$3.9 billion for the first nine months of fiscal 2020. On a constant currency basis, net sales increased 14% for the third quarter and decreased 8% for the first nine months of fiscal 2022 compared to the same periods of fiscal 2020. Open-only comp store sales were up 10% for the third quarter of fiscal 2022 and up 11% for the first nine months of fiscal 2022 compared to the same periods of fiscal 2020. The increases in open-only comp store sales were driven by an increase in average basket, partially offset by reduced customer traffic. E-commerce sales represented less than 6% ofTJX International's net sales for both the third quarters and first nine months of fiscal 2022, fiscal 2021 and fiscal 2020. Segment Profit / (Loss) Fiscal 2022 vs Fiscal 2021 Segment profit was$127 million for the third quarter of fiscal 2022, an increase of$40 million compared to a segment profit of$87 million for the third quarter of fiscal 2021. This increase was driven by additional sales resulting in an improved segment profit margin of 7.2% for the third quarter of fiscal 2022 compared to 6.1% for the third quarter of fiscal 2021. Segment profit was$79 million for the first nine months of fiscal 2022, an increase of$382 million compared to a segment loss of$(303) million for the first nine months of fiscal 2021. The increase in segment profit for the first nine months of fiscal 2022 was primarily driven by improved merchandise margin due to lower markdowns. The first nine months of fiscal 2022 reflected$157 million of government programs compared to$90 million for the nine months of fiscal 2021. Fiscal 2022 vs Fiscal 2020 Segment profit increased$28 million compared to a segment profit of$99 million for the third quarter of fiscal 2020. Segment profit margin increased to 7.2% for the third quarter of fiscal 2022 compared to 6.9% for the third quarter of fiscal 2020. The increase in segment profit margin was primarily driven by expense leverage on occupancy costs due to strong open-only comp store growth and the favorable impact of the mark-to-market on inventory derivatives. These increases were partially offset by higher store payroll which includes incremental COVID-19 related costs and higher supply chain costs. Segment profit decreased$99 million compared to a segment profit of$178 million for the first nine months of fiscal 2020. The decrease in segment profit was primarily driven by a reduction in sales due to the temporary store closures for the first nine months of fiscal 2022. Segment profit was favorably impacted by the government programs received in the first nine months of fiscal 2022. 32 --------------------------------------------------------------------------------
GENERAL CORPORATE EXPENSE
Thirteen Weeks Ended Thirty-Nine Weeks Ended
October 30, October 31, October 30, October 31,
In millions 2021 2020 2021 2020
General corporate expense $ 148 $ 150 $ 472 $ 374
General corporate expense for segment reporting purposes represents those costs
not specifically related to the operations of our business segments. General
corporate expenses are primarily included in SG&A expenses. The mark-to-market
adjustment of our fuel hedges is included in cost of sales, including buying and
occupancy costs.
The slight decrease in general corporate expense for the third quarter of fiscal
2022 was primarily due to timing of funding to TJX's charitable foundations
offset by higher share-based and incentive compensation costs in fiscal 2022.
The increase in general corporate expense for the first nine months of fiscal
2022 was primarily driven by higher share-based and incentive compensation costs
partially offset by a favorable mark-to-market adjustment on fuel hedges.
ANALYSIS OF FINANCIAL CONDITION
Liquidity and Capital Resources
In response to the pandemic, primarily during the first quarter of fiscal 2021,
we took several steps to strengthen our financial position and balance sheet and
to maintain financial liquidity and flexibility. The challenges posed by the
COVID-19 pandemic on our business continue to evolve and the severity and
duration of the pandemic is still unknown. Consequently, we will continue to
evaluate our financial position in light of future developments.
We believe our existing cash and cash equivalents, internally generated funds
and our credit facilities, under which facilities we have $1.5 billion available
as of the period ended October 30, 2021 , as described in Note I-Long-Term Debt
and Credit Lines of Notes to Consolidated Financial Statements, are adequate to
meet our operating needs over the next twelve months.
Our liquidity requirements have traditionally been funded through cash generated
from operations, supplemented, as needed, by bank borrowings and the issuance of
commercial paper. As of October 30, 2021 , there were no short-term bank
borrowings or commercial paper outstanding. We monitor debt financing markets on
an ongoing basis and from time to time may incur additional long-term
indebtedness depending on prevailing market conditions, liquidity requirements,
existing economic conditions and other factors. In the first nine months of
fiscal 2022 we have used, and in the future we may use, operating cash flow and
cash on hand to repay portions of our indebtedness, depending on prevailing
market conditions, liquidity requirements, existing economic conditions,
contractual restrictions and other factors. As such, we may, from time to time,
seek to retire, redeem, prepay or purchase our outstanding debt through
redemptions, cash purchases, prepayments, refinancings and/or exchanges, in open
market purchases, privately negotiated transactions, by tender offer or
otherwise. If we use our operating cash flow and/or cash on hand to repay our
debt, it will reduce the amount of cash available for additional capital
expenditures.
As of October 30, 2021 , we held $6.8 billion in cash. Approximately $1.5 billion
of our cash was held by our foreign subsidiaries with $0.7 billion held in
countries where we indefinitely reinvest any undistributed earnings. TJX
provided for all applicable state and foreign withholding taxes on all
undistributed earnings of our foreign subsidiaries in Canada , Puerto Rico ,
Italy , India , Hong Kong and Vietnam through October 30, 2021 . If we repatriate
cash from such subsidiaries, we should not incur additional tax expense and our
cash would be reduced by the amount of withholding taxes paid.
Operating Activities
Operating activities resulted in net cash inflows of $1.9 billion for the nine
months ended October 30, 2021 and $4.3 billion for the nine months ended October
31, 2020 .
Operating cash flows decreased compared to fiscal 2021 primarily due to the $5.0
billion change in merchandise inventories net of accounts payable, driven by
higher inventory levels in fiscal 2022 as well as timing of merchandise payments
in fiscal 2021. In addition, operating cash flows were negatively impacted by
the $0.3 billion decrease in net operating lease liabilities due to the
repayment of many of the rent deferrals negotiated in fiscal 2021. The decrease
in operating cash flows was partially offset by an increase in net income.
Temporary store closures in fiscal 2021 resulted in a net loss of $0.2 billion
in the first nine months of fiscal 2021 compared to net income of $2.3 billion
for the first nine months of fiscal 2022.
33
--------------------------------------------------------------------------------
Investing Activities
Investing activities resulted in net cash outflows of $0.7 billion for the nine
months ended October 30, 2021 and $0.4 billion for the nine months ended October
31, 2020 . The cash outflows for both periods were driven by capital
expenditures.
Investing activities in the first nine months of fiscal 2022 primarily reflected
property additions for new stores, store improvements and renovations as well as
investments in our distribution centers and offices, including buying and
merchandising systems and other information systems. Our expected fiscal 2022
capital investments total $1.2 billion to $1.4 billion . We plan to fund these
expenditures through cash flows from operations.
Financing Activities
Financing activities resulted in net cash outflows of $4.9 billion for the first
nine months of fiscal 2022 and net cash inflows of $3.5 billion for the nine
months ended October 31, 2020 .
Debt
The cash outflows in the first nine months of fiscal 2022 were due to the
completion of make-whole calls and the redemption at par of certain of our notes
during the first half of fiscal 2022. On June 4, 2021 , we completed make-whole
calls for our $1.25 billion principal outstanding, 3.50% Notes due April 15,
2025 , and our $750 million principal outstanding, 3.75% Notes due April 15,
2027 , both of which series of notes were issued in the first quarter of fiscal
2021 in response to the COVID-19 pandemic. As a result of these redemptions
prior to their scheduled maturities, we recorded a pre-tax debt extinguishment
charge of $242 million in the second quarter of fiscal 2022. Additionally, in
the first quarter of fiscal 2022, we redeemed $750 million principal
outstanding, 2.75% Notes due June 15, 2021 . The result of these debt redemptions
resulted in a $2.75 billion reduction of outstanding debt since the beginning of
fiscal 2022 and will result in more than $90 million of annualized interest
expense savings. The cash inflows in the first nine months of fiscal 2021 were a
result of completing the issuance and sale of $4 billion aggregate principal
amount of notes. For additional information on these transactions, see Note
I-Long-Term Debt and Credit Lines of Notes to Consolidated Financial Statements.
Equity
In March 2020 , in connection with the actions taken related to the COVID-19
pandemic, we suspended our share repurchase program. During the second quarter
of fiscal 2022, we lifted the temporary suspension of our repurchase program and
we plan to repurchase approximately $1.75 billion to $2 billion of stock in
fiscal 2022 under our previously authorized stock repurchase programs. Under our
stock repurchase programs, we paid $1.1 billion to repurchase and retire 16.3
million shares of our stock on a settlement basis in the first nine months of
fiscal 2022. Prior to the temporary suspension of our share repurchase program
related to the COVID-19 pandemic, we paid $0.2 billion to repurchase and retire
3.4 million shares on a settlement basis in the first nine months of fiscal
2021. These outflows were partially offset by proceeds from the exercise of
employee stock options, net of shares withheld for taxes in the first nine
months of fiscal 2021. As of October 30, 2021 , approximately $1.9 billion
remained available under our existing stock repurchase programs. For further
information regarding equity repurchases, see Note D - Capital Stock and
Earnings Per Share of Notes to Consolidated Financial Statements.
Dividends
We declared quarterly dividends on our common stock of $0.26 per share for each
of the quarters in fiscal 2022 and expect to declare a similar dividend in the
fourth quarter of fiscal 2022, subject to approval by the Board of Directors. As
a result of the uncertainty surrounding the COVID-19 pandemic, no dividends were
declared in the first nine months of fiscal 2021. Cash payments for dividends on
our common stock totaled $0.9 billion for the first nine months of fiscal 2022
and $0.3 billion for the first nine months of fiscal 2021.
RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS
For a discussion of accounting standards, see Note A-Basis of Presentation and
Summary of Significant Accounting Policies of Notes to Consolidated Financial
Statements included in TJX's Annual Report on Form 10-K for the fiscal year
ended January 30, 2021 and Note A-Basis of Presentation and Summary of
Significant Accounting Policies of Notes to Consolidated Financial Statements in
this Quarterly Report on Form 10-Q.
34
--------------------------------------------------------------------------------
FORWARD-LOOKING STATEMENTS
Various statements made in this Quarterly Report on Form 10-Q are
forward-looking and involve a number of risks and uncertainties. All statements
that address activities, events or developments that we intend, expect or
believe may occur in the future are forward-looking statements. The following
are some of the factors that could cause actual results to differ materially
from the forward-looking statements: the ongoing COVID-19 pandemic and
associated containment and remediation efforts; execution of buying strategy and
inventory management; various marketing efforts; customer trends and
preferences; competition; operational and business expansion; management of
large size and scale; merchandise sourcing and transport; labor costs and
workforce challenges; personnel recruitment, training and retention; data
security and maintenance and development of information technology systems;
corporate and retail banner reputation; cash flow; expanding international
operations; fluctuations in quarterly operating results and market expectations;
mergers, acquisitions, or business investments and divestitures, closings or
business consolidations; real estate activities; inventory or asset loss;
economic conditions and consumer spending; market instability; serious
disruptions or catastrophic events; disproportionate impact of disruptions in
the final quarter of the fiscal year; commodity availability and pricing;
adverse or unseasonable weather; fluctuations in currency exchange rates;
compliance with laws, regulations and orders and changes in laws, regulations
and applicable accounting standards; outcomes of litigation, legal proceedings
and other legal or regulatory matters; quality, safety and other issues with our
merchandise; tax matters; and other factors that may be described in our filings
with the Securities and Exchange Commission , including our most recent Annual
Report on Form 10-K filed with the Securities and Exchange Commission . We do not
undertake to publicly update or revise our forward-looking statements even if
experience or future changes make it clear that any projected results expressed
or implied in such statements will not be realized.
Item 3. Quantitative and Qualitative Disclosures about Market Risk
There have been no material changes in our primary risk exposures or management
of market risks from those disclosed in our Annual Report on Form 10-K for the
fiscal year ended January 30, 2021 .
Item 4. Controls and Procedures
We have carried out an evaluation, under the supervision and with the
participation of our management, including our Chief Executive Officer and Chief
Financial Officer, of the effectiveness of the design and operation of our
disclosure controls and procedures as of October 30, 2021 pursuant to Rules
13a-15(b) and 15d-15(b) of the Securities Exchange Act of 1934, as amended (the
"Act"). Based upon that evaluation, our Chief Executive Officer and Chief
Financial Officer concluded that our disclosure controls and procedures are
effective at the reasonable assurance level in ensuring that information
required to be disclosed by us in the reports that we file or submit under the
Act is (i) recorded, processed, summarized and reported, within the time periods
specified in the Securities and Exchange Commission's rules and forms; and
(ii) accumulated and communicated to our management, including our principal
executive and principal financial officers, or persons performing similar
functions, as appropriate to allow timely decisions regarding required
disclosures. Management recognizes that any controls and procedures, no matter
how well designed and operated, can provide only reasonable assurance of
achieving their objectives and management necessarily applies its judgment in
evaluating the cost-benefit relationship of implementing controls and
procedures.
There were no changes in the Company's internal controls over financial
reporting (as defined in Rule 13a-15(f) and 15d-15(f) under the Act) during the
fiscal quarter ended October 30, 2021 identified in connection with the
evaluation by our management, including our Chief Executive Officer and Chief
Financial Officer, that have materially affected, or are reasonably likely to
materially affect, our internal control over financial reporting.
35--------------------------------------------------------------------------------
© Edgar Online, source
