TJ Maxx 1999 Annual Report Download - page 9

1999 of $5.2 million (net of income taxes of $3.4 million), or $.02 per share, is shown as the cumulative effect
of accounting change in the Consolidated Statements of Income.The accounting change has virtually no impact
on annual sales and earnings (before cumulative effect).However, due to the seasonal influences of the business,
the accounting change results in a shift of sales and earnings among the Company’s quarterly periods.As a result,
the Company has restated its earnings for the first three quarters of the fiscal year ended January 29, 2000 (see
Selected Quarterly Financial Data, page 45, for more information). Except for the Selected Quarterly Financial
Data, the Company has not presented pro forma results for prior fiscal years due to immateriality.
B . D i sp o sit io n s a nd A c q u i s i t i o n s
S a le o f C h ad w ick ’s o f Bo sto n : The Company sold its former Chadwick’s division in fiscal 1997 to Brylane,
Inc.As part of the proceeds from the sale, the Company received a $20 million convertible note. During fiscal
1998, the Company converted a portion of the Brylane note into 352,908 shares of Brylane, Inc. common stock
which it sold for $15.7 million. This sale resulted in an after-tax gain of $3.6 million. During fiscal 1999, the
balance of the note was converted into shares of Brylane common stock.A portion of the shares were donated
to the Company’s charitable foundation, and the remaining shares were sold. The net pre-tax impact of these
transactions was immaterial. Pursuant to the agreement, the Company retained the Chadwick’s consumer credit
card receivables. The cash provided by discontinued operations for fiscal 1998 represents the collection of the
remaining balance of the Chadwick’s consumer credit card receivables outstanding as of January 25, 1997.Also
pursuant to the disposition, the Company agreed to purchase certain amounts of excess inventory from Chad-
wick’s.This arrangement has subsequently been amended and extended through fiscal 2002.
S a le o f H it o r M iss: Effective September 30, 1995, the Company sold its Hit or Miss division to members of
Hit or Miss management and outside investors.The Company received $3.0 million in cash and a seven-year $10
million note with interest at 10%. During fiscal 1998, the Company forgave a portion of this note and was
released from certain obligations and guarantees which reduced the note to $5.5 million. During fiscal 1999,the
Company settled the note for $2.0 million, the balance of $3.5 million was charged to selling, general and
administrative expenses.
A cqu isit io n o f M a rsha lls: On November 17, 1995, the Company acquired the Marshalls family apparel
chain from Melville Corp o rat i o n .The Company paid $424.3 million in cash and $175 million in junior conve r t i bl e
p re fe r red stock.The total purchase price of Mars h a l l s , including acquisition costs of $6.7 million, was $606 million.
C . L o n g- Te rm D e b t a n d C re d it L i n e s
At January 29, 2000 and January 30, 1999, long-term debt, exclusive of current installments, consisted of the
following: Ja n u a ry 2 9, Ja nua ry 3 0 ,
I n Th o u s a n d s 2 0 0 0 1 9 9 9
Equipment notes, interest at 11% to 11.25% maturing
December 12, 2000 to December 30, 2001 $ 73 $ 433
General corporate debt:
Medium term notes, interest at 5.87% to 7.97% , $15 million maturing
October 21, 2003 and $5 million maturing September 20, 2004 20,000 20,000
65/8% unsecured notes, maturing June 15, 2000 –100,000
7% unsecured notes, maturing June 15, 2005 (effective interest rate of 7.02%
after reduction of the unamortized debt discount of $75,000 and $89,000
in fiscal 2000 and 1999, respectively) 99,925 99,911
7.45% unsecured notes, maturing December 15, 2009 (effective interest rate of
7.50% after reduction of unamortized debt discount of $631,000 in fiscal 2000) 199,369 –
Total general corporate debt 319,294 219,911
Long-term debt, exclusive of current installments $319,367 $220,344